Ampol Posts US$4.60/Barrel Refinery Margin, $715M EBIT Forecast for FY24
Ampol Limited reports a resilient 4Q 2024 trading update with a Lytton Refiner Margin of US$4.60 per barrel and an expected unaudited Group RCOP EBIT of approximately $715 million for the full year, despite operational headwinds.
- 4Q 2024 Lytton Refiner Margin at US$4.60 per barrel, impacted by FCCU maintenance
- Unaudited Group RCOP EBIT of ~$715 million and RCOP EBITDA of ~$1.2 billion for FY 2024
- Strong Australian Convenience Retail performance offsets refinery disruptions
- Increased supply chain costs due to unplanned outages and maintenance
- International segment faces subdued market conditions with limited value opportunities
Refinery Margin and Operational Impact
Ampol Limited’s latest trading update reveals a Lytton Refiner Margin (LRM) of US$4.60 per barrel for the fourth quarter of the 2024 financial year. This figure reflects the impact of a planned Fluidised Catalytic Cracking Unit (FCCU) pitstop in November, strategically timed during a period of lower-than-average product cracks. The refinery’s production volume for the quarter stood at 1,542 million litres, with a less favourable mix of high-value products due to maintenance activities.
The FCCU was successfully restarted in December, with operations returning to normal and the pitstop enabling Ampol to defer previously scheduled turnaround and inspection (T&I) work from 2025 to the first half of 2026. This proactive maintenance approach aims to optimise refinery uptime and cost efficiency in the medium term.
Financial Performance and Segment Highlights
Despite the operational challenges, Ampol expects to deliver an unaudited Group Replacement Cost Operating Profit (RCOP) EBIT of approximately $715 million and RCOP EBITDA of around $1.2 billion for the full year 2024. This follows two consecutive years of record financial performance, underscoring the company’s resilience amid fluctuating market conditions.
The Australian Convenience Retail segment demonstrated consistent strength throughout the year, providing a stable revenue base. Meanwhile, the New Zealand business showed resilience despite a challenging economic environment and the absence of a one-off fuel excise duty recovery that had boosted prior year results. Notably, sales volumes in New Zealand increased in the fourth quarter, driven mainly by lower-margin wholesale and commercial sectors.
Supply Chain Pressures and International Market Dynamics
In the second half of 2024, Ampol incurred increased costs within its Fuel & Infrastructure (F&I) Australia operations to maintain supply continuity amid unplanned refinery outages. These costs included freight demurrage, coastal freight, and prompt sourcing of replacement products, highlighting the operational pressures faced during the period.
The F&I International segment continued to operate in a well-supplied market characterized by reduced volatility, which limited opportunities for value creation throughout the year. Additionally, recent sanctions targeting vessels trading in the 'dark fleet' and a colder northern hemisphere winter have influenced global crude and product supply chains, lifting middle distillate cracks while gasoline cracks remain soft due to seasonal factors.
Looking Ahead
Ampol’s full audited financial results for 2024 are scheduled for release on 24 February 2025, which will provide further clarity on the company’s performance and outlook. Investors will be watching closely for how Ampol manages ongoing supply chain complexities and market volatility as it navigates the evolving energy landscape.
Bottom Line?
Ampol’s strategic maintenance and robust retail performance underpin a solid 2024, but supply chain headwinds loom.
Questions in the middle?
- How will deferred refinery maintenance into 2026 impact future operational efficiency and costs?
- What strategies will Ampol deploy to mitigate increased supply chain and freight costs?
- How might evolving global sanctions and seasonal demand shifts affect Ampol’s international margins?
