Viva Energy shares slump as lower tobacco demand weighs on sales
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More news: Shares in Viva Energy tanked in morning trade after the fuel company reported a 10% drop in first-half convenience sales following a sharp decline in tobacco demand.
Viva shares were down 10.4% to $1.96 at midday AEST, leading losses across the ASX 200.
Viva Energy posts 10% drop in convenience sales, earnings to hit guidance
The news: Oil refiner and retailer Viva Energy has reported a 10% slide in first-half convenience sales as new packaging laws saw tobacco sales tumble during the period.
The numbers: According to unaudited figures released this morning, Viva's convenience sales fell 10.4% year on year to $835 million.
The company said the decline was driven by a 27% drop in tobacco sales, partly offset by higher gross margin.
Total convenience and mobility (C&M) sales lowered 0.5% compared with the same period last year, with retail fuel margins strengthening during the second quarter.
The context: Viva said earnings before interest, taxes, depreciation, and amortisation (EBITDA) across its C&M and commercial and industrial arms is expected to be $310 million, above the midpoint of the previously announced guidance range.
Unaudited group EBITDA is expected to be around $300 million, with a positive contribution from Viva's energy and infrastructure divisions offset by corporate costs.
The source: ASX
