Viva Energy Group Announces Its Full Year Results And The Acquisition Of Liberty Oil Wholesale Business 

  • Feb 27, 2019 AEDT
  • Team Kalkine
Viva Energy Group Announces Its Full Year Results And The Acquisition Of Liberty Oil Wholesale Business 

Viva Energy Group Limited (ASX: VEA) made an announcement on 27 February 2019 stating that it is going to acquire the remaining 50% interest in Liberty Oil’s wholesale business (Liberty Oil Holdings). This acquisition is a significant step in the company’s regional growth strategy as Liberty Oil Holdings is a leading national supplier of bulk fuels and lubricants and this acquisition will help Viva Energy Group in expanding its operations.

The company has also announced regarding the establishment of a new retail joint venture to grow the existing Liberty Oil retail business (Liberty Oil Convenience), of which it will own 50%. The company is planning to buy the 50% interest in Liberty Oil Holdings for a total consideration of $42 million.

Further, the company has also released its full-year results for FY 2018. For FY 2018, the company has reported sales volume of 14,045 million litres which is broadly in line with the prospectus forecast of 14,086 million litres, despite weaker than expected volumes in the Alliance. On replacement cost (RC) basis, the company has reported Underlying Net Profit After Tax (RC) of $293.0 million which is 9.6% lower than the prospectus forecast.

Further, the company reported Underlying EBITDA (RC) of $608.8 million from its retail segment, which was in line with guidance of $607.6 million provided in November 2018. The result was slightly lower than Prospectus forecast (by 1.4%), driven by lower than expected sales volumes through the Alliance network during the second half of FY 2018.

The company’s commercial segment outperformed Prospectus forecast generating Underlying EBITDA (RC) of $323.8 million compared to the Prospectus forecast of $318.3 million. The company’s Refining segment delivered Underlying EBITDA (RC) of $124.5 million, in line with the revised guidance provided in January 2019.

The company’s board has declared a final dividend of 4.8 cents per share for six months ended 31 December 2018, fully franked which represents a 60% payout ratio of Distributable NPAT (RC) in line with the policy to target a payout ratio of between 50 – 70% of Distributable NPAT (RC). The Record date of the Final dividend is 28 March 2019, and the dividend is expected to be paid on 15 April 2019. Further, the company has reaffirmed its target payout ratio range of 50 – 70% of Distributable NPAT (RC).

The company is expecting Underlying EBITDA (RC) for Retail segment to be around $321.9 million in 1H FY 2019 and it is expecting 2H2019 to be in line with 1H2019.

Today the company has also provided its Geelong Refining Margin (GRM) update for the month of January 2019. As per the company’s announcement, the actual GRM for January 2019 is US$4.0/Barrel with crude intake of 3.7mbbls.

Meanwhile, in the last three months, the share price of the company decreased by 20.91% as on 26 February 2019. VEA’s shares traded at $2.370 with a market capitalization of circa $4.67 billion as on 27 February 2019.


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