Refinery Losses Blow Out At Ampol

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Weak margins from its under review Lytton refinery in Brisbane saw Ampol’s third-quarter earnings slide by around 75%.

The weak result from Lytton more than offset an improvement in returns from convenience retailing chain.

Benchmark net profit excluding one-off items was $24 million in the third quarter, down from $94 million in the year-earlier period.

That was still much better than the big loss for the June quarter, thanks to inventory write-downs based on the slide in global oil prices, weak demand, especially for jet fuel and diesel.

Ampol, formerly known as Caltex Australia, reported a net profit on a replacement cost of sales operating profit basis of $129 million in the latest quarter, after making a net loss of $597 million in the three months to June.

The return to profitability came despite a bigger loss at the company’s 109,000 b/d Lytton refinery in in Brisbane.

Ampol said its fuels and infrastructure group, ex-Lytton refinery, was affected by Covid-19 restrictions imposed by Australia and internationally.

Australian diesel sales volumes fell by 10% in the September quarter compared with the same period a year earlier, while petrol volumes dropped 14% and jet fuel volumes plunged 64% because of the impact of domestic and international travel restrictions.

The retail convenience chain saw its earnings before interest and tax rise to $87 million from $24 million a year earlier and $41 million in the three months to June.

However, the return from Lytton doubled to a loss of $82 million from a loss of $41 million (and a profit of $32 million in the June quarter).

Ampol shares rose 1.3% to $25.42.

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Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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