By Ampol has reported a 25% decrease in annual net profit from continuing operations, attributing this to weaker refining margins. However, the company managed to balance this setback with a strong performance by its non-refining units.
Financial Details
- Net profit for the 12 months through December amounted to 549.1 million Australian dollars.
- This is a decline from the previous year’s 795.9 million Australian dollars, with the disparity partly due to an earnings contribution from operations that Ampol no longer owns.
- The company reports financials on a historical cost basis.
- Ampol’s profit, when evaluated using a replacement cost-of-sales basis to eliminate oil price fluctuations, increased by 1.1% to 740.1 million Australian dollars.
- The company’s annual revenue for the latest reporting period was 37.75 billion Australian dollars, slightly lower than the previous year’s figure of 38.49 billion.
Dividend Announcement
- In light of its financial performance, Ampol has decided to pay a final dividend of 1.20 Australian dollars per security, up from 1.05 dollars in the prior year.
- Additionally, a special dividend of 0.60 Australian dollars per security has been declared, marking the second consecutive year of extra capital management efforts.
Ampol’s Stock Reaches Eight-Year Highs
Investors Embrace Strategic Expansion
Ampol’s stock has climbed to its highest level in eight years as investors show confidence in the company’s strategy to diversify its revenue streams, particularly by increasing its presence in New Zealand’s fuel market through the acquisition of Z Energy in 2022 and strengthening its position in the convenience retail sector in Australia.
The stock-price surge gained momentum in mid-January when Ampol projected record earnings before interest and tax, excluding businesses that have been divested.
Ampol reported that the Lytton Refiner Margin averaged US$12.81 per barrel in 2023, a slight decrease from the previous year’s peak levels. Challenges arose towards the end of December when an unplanned outage at Lytton refinery impacted fourth-quarter volumes, resulting in earnings before interest and tax of A$362.3 million.
Excluding Lytton’s contribution, Ampol’s Fuels and Infrastructure earnings more than doubled due to a surge in domestic demand and a rebound in jet fuel sales post-pandemic.
Responding to Market Dynamics
“The growth in Fuels and Infrastructure (Ex-Lytton) showcases our ability to adapt to market changes through our sourcing expertise, robust infrastructure, and effective risk management, leading to a significant increase in earnings compared to the previous year,” explained Chief Executive Matt Halliday.
In the convenience retail segment, Ampol achieved a 2.1% growth in earnings, reaching a record A$354.6 million, largely fueled by improved fuel margins.
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