Viva Energy lifts sales but flags lower earnings

The news: Fuel refiner and retailer Viva Energy saw higher fuel sales in the December quarter but has flagged lower full-year earnings after prolonged maintenance work at its Geelong refinery.

The numbers: Viva expects full-year group earnings to be $710 million in 2023, down from $1.08 billion in the previous year. Refining volumes were down nearly 25% for the year, while refining margins were down 42% from a year ago. However, fuel sales volumes were up nearly 9% for the year to 15.5 billion litres, driven by strong commercial and industrial fuel volumes.

The context: Viva said weaker regional refining margins, elevated crude premia and out sales of surplus intermediate feedstocks contributed to lower refining margins in the December quarter. Its Geelong refinery returned to normal operations following the extended major maintenance work, with crude intake ramping up to full capacity over the quarter. Viva supplies about a quarter of Australia’s liquid fossil fuels. Overall sales at its convenience network was largely flat for the year, at $1.14 billion.