Viva Energy lifts interim profit despite slowing demand
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The news: Fuel refiner and retailer Viva Energy has lifted half-year profit on the back of strong earnings from its refinery business, offsetting a slowing down in fuel sales volumes.
The numbers: Net profit for the six months to June rose 10.3% to $192.1 million, ahead of analyst estimates of $177.7 million. Revenue rose 13% to $14.38 billion, while underlying group earnings jumped 24.8% to $451.7 million.
The company will pay an interim dividend of 6.7 cents a share, down from 8.5 cents a year ago.
The context: The bulk of its profit growth came from stronger earnings in refining, as its Geelong refinery returned to normal operations following extended major maintenance work. This helped offset a slight dip in retail fuel volumes and convenience sales. Fuel sales were higher in its commercial and industrial business.
Viva CEO Scott Wyatt said the results demonstrate resilience given that cost of living pressures and illegal tobacco trade are having an impact on consumer demand in the convenience business, while wage and cost inflation is driving up costs. He expects the consumer market to remain challenging for the rest of 2024 but said Viva will pursue cost and earnings improvements as a priority over the next 18 months.
The source: ASX announcement
