Fuel supplier Caltex Australia Limited (ASX: CTX
) has provided extended historical data of the recent financial years for the comparative study of first half year results of FY18. The information has been given on its two business units, that includes Fuels & Infrastructure and Convenience Retail.
The underlying earnings before interest and tax (EBIT) for fuel and infrastructure business has shown considerable improvement from $304 million in 1H17 to $322 million in 1H18. Whereas in Convenience retail segment EBIT has declined to $161 million in first half of 2018, representing $26 million fall from previous corresponding period’s EBIT of $187 million.
The downtrend in Caltex convenience retail business is driven by sales volume decline and rising crude and product prices on fuel margin. Convenience Retail fuel volumes fell 2.6% to 2.5BL in the 1H18. It reflects 6.4% decline in petrol volumes which was partially offset by 2.1% retail diesel demand growth. Moreover, the ongoing transition of franchise stores to company operations has been another major factor for decline.
Fuels margin except Lytton has grown to $392 million in 1H18 compared to $330 million in previous corresponding year. There has been 12% rise in total Fuels & Infrastructure volumes to 10.2BL in 1H 2018. As a result, F&I RCOP EBIT jumped up from $155 million in pcp to $217 in 1H18.
While on the other hand, Group’s Lytton EBITDA has slipped considerably by $41 million to $136 million in fist half of 2018 when compared with 1H17.
Further, Group’s total replacement cost of sales operating profit (RCOP) EBIT in 1H18 has also drifted lower to $443 million compared to $454 in previous corresponding period.
The agreement on fuel redemption arrangements with Woolworths along with new fuel partnerships are expected to upsurge the company’s future fuel volumes in Convenience Retail sector.
The Board has declared dividend of $0.57 per share for the six-month ended 30 June 2018. This reflects a pay-out ratio of 50.3%, consistent with the company’s target dividend pay-out range of 40% and 60%.
Recently the company has announced the retirement of Caltex’s Chief Financial Officer Mr. Simon Hepworth. However, Mr. Hepworth is expected to remain in his role until mid-2019.
In today’s trading session CTX has shown slight upside movement. The share price has surged up 0.072% to close at $27.630 on 26 October 2018. Further, the stock has seen a performance change of -19.36% over the past one year.