Australia's Ampol beats profit and dividend estimates, shares rise
Australia's Ampol on Monday beat market expectations for its first half-profit and dividend even as margins from its Lytton refinery in Brisbane weakened following an unexpected outage, sending its shares up 2.3% in early trade.
The fuel retailer announced an interim dividend of AUS$0.95 per share, beating a market consensus of AUS$0.88 per share.
"Despite a year-on-year slump in interim dividend, a 69% payout ratio is still healthy," said Tina Tang, analyst at CMC Markets.
The Lytton margin was affected due to weak Singapore product cracks in April and May, coupled with the impact of the cracking unit outage, the company, which is expanding its operations overseas and is moving into low-carbon energy, said.
The country's biggest fuel supplier reported net profit after tax from continuing operations of AUS$329.6 MM (US$211.34 MM) on a replacement-cost basis for the first half, beating a consensus estimate of AUS$302 MM.
Ampol indicated early positive signs in the second half, with Lytton refining margin averaging $15.31 a barrel in July, above historical levels.
"Fuel margins for convenience retailing is expected to normalize as prices stabilize," Ampol said while expecting continued strong performance from its shops.
"Stabilizing fuel prices may support its second-half performance," added Teng, highlighting the profit decline was due to the 'temporary' Lytton outage.
Earnings before interest and tax (EBIT) were at AUS$100.3 MM for the six months ended June 30 on a replacement-cost basis from Lytton operations, reflecting lower second-quarter refiner margins.
The poor performance from the dominant refining operations were partly offset by higher sales volumes and contributions from Z Energy.
The Sydney-based firm, which completed the acquisition of Z Energy in May last year, said the unit's EBIT for the first half was AUS$122.8 MM, missing an UBS estimate of AUS$174 MM on higher-than-forecast operating costs.
(Reporting by Rishav Chatterjee and Upasana Singh in Bengaluru; Editing by Matthew Lewis, Diane Craft and Rashmi Aich)
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