Viva Energy Group (VEA) H2 2023 earnings summary

Executive summary

• FY2023 group EBITDA (RC) was $712.8M, down 33.7% YoY, while EBITDA excluding Refining increased 16%; lower refining earnings reflected extended maintenance and lower regional margins.

• Group fuel sales rose 9% to 15.5BL; net debt closed at $380M, up $670.5M from FY2022.

• Convenience & Mobility and Commercial & Industrial delivered resilient growth, while Energy & Infrastructure was affected by refinery maintenance and the compressor incident.

Financial highlights

• Revenue was $26,741.1M versus $26,432.6M in FY2022; EBITDA (RC) was $712.8M versus $1,075.8M.

• NPAT (RC) was $318.2M, down 46.7% YoY; historical-cost net profit after tax was $492.7M.

• Underlying FCF (RC) was $199.1M versus $522.0M; FY2023 dividends totaled 15.6 cents per share, up 9% excluding Refining.

• FY2023 net cash flow was negative $75.0M; the cash flow bridge included a $255.9M net inventory loss and $26.7M of C&M acquisition integration costs.

Outlook and guidance

• FY2024 net capex guidance is $440M–$475M, excluding expected OTR Group capex; guidance includes sustaining, compliance and growth investment.

• C&M expects subdued market fuel demand amid high prices and cost-of-living pressures, with focus on non-tobacco convenience sales and margin mix; OTR is expected to contribute after completion.

• C&I expects growth from recent business wins and the OTR wholesale division, while global economic weakness and elevated shipping costs may weigh on demand and costs.

• E&I expects continued strength in regional refining margins, no major planned FY2024 turnarounds and operating costs normalising toward ~US$8.5/BBL, assuming full intake.