Ampol shares hit six-week high on ‘impressive’ sales

afr.com:

Ampol shares rallied to a six-week high on Wednesday after a trading update that revealed its total fuel sales rose by nearly a quarter in the first half.

The fuel retailer has updated the market before reporting its half-year earnings next month. Total group fuel sales volumes increased 24 per cent to 14.3 billion litres in the first half, up from 11.5 billion litres a year earlier.

Ampol is the largest transport energy distributor and retailer in Australia, with more than 1900 Ampol-branded stations across the country. It also operates in New Zealand through its subsidiary Z Energy.

Australian fuel sales increased 13 per cent and international fuel sales increased 8 per cent, driven by a three-fold rise in sales from Z Energy.

The shares were up 4.36 per cent to close at $31.14 on Wednesday.

RBC Capital analyst Gordon Ramsay said the sales were “impressive” and helped offset the poor margins at its Lytton refinery in Queensland.

“Ampol’s first half 2023 update has highlighted the strength of the company’s non refining divisions,” Mr Ramsay told investors in a note.

Overall first half unaudited group RCOP (replacement cost operating profit) earnings before interest and taxes dropped 22 per cent to $575 million, but were still above analyst consensus.

RCOP earnings before interest, taxes, depreciation and amortisation lost 14 per cent to $800 million. “Overall, a good result with Ggroup EBITDA and EBIT above our forecast,” Mr Ramsay added.

The refiner posted a 54 per cent decline in first-half refining margins at its Lytton refinery, collecting just $US10.29 per barrel, less than half of the margin of $US22.35 per barrel a year earlier.

Along with weaker pricing, the refinery was also hit by a month-long outage during