Viva Energy Group Ltd. · ASX:VEA
Viva Energy — H1 2024 Earnings Presentation
32 slides from Viva Energy's earnings presentation, Aug 26, 2024
Slide 1: Half Year Results
Half Year Results Half Year ended 30 June 2024
Slide 2: Important notice and disclaimer
Important notice and disclaimer This presentation has been prepared by Viva Energy Group Limited, fairness, accuracy, completeness or correctness of the information, information contained within this presentation may be unreliable given ACN 626 661 032 (“Company” or “Viva Energy”). opinions and conc
Slide 3: Group Highlights
Group Highlights Scott Wyatt Viva Energy Group Limited – 1H2024 Results Presentation 3
Slide 4: Safety and Environment
Safety and Environment Expanded activity, growing to almost 15,000 employees in 1H2024 Total Recordable Injury Loss of primary containment Process safety events2 Frequency Rate1 (>100KG)2 4 3 6.7 6.6 7.2 6.0 24 19 19 1 11 1 1 1 FY21 FY22 FY23 1H24 FY21 FY22 FY23 1H24 FY21 FY22 FY23 1H24 Tier 1 Tier
Slide 5: 1H2024 Highlights
1H2024 Highlights Strong growth with significant progress on our strategic agenda Performance Group fuel sales Group EBITDA (RC) Net debt 1H2024 dividend +6%1 $452M $1,452M 6.7 CPS To 8.3BL +25% y/y Financed OTR 70% payout ratio acquisition of C&M and C&I2 Strategy • Completed OTR Group • C&M integr
Slide 6: Convenience & Mobility (C&M)
Convenience & Mobility (C&M) Resilient performance in a challenging retail environment (cost-of-living pressures impacting demand) Fuel and convenience sales1 C&M EBITDA (RC)4 3,000.0 0.8 1.0 0.8 0.8 0.8 124 122 117 0.8 2,500.0 404 404 2,000.0 398 413 89 Fuel Sales (ML) 265 364 396 0.6 1,500.0 319 1
Slide 7: Commercial & Industrial (C&I)
Commercial & Industrial (C&I) Sales and earnings growth driven by continued strong demand across most sectors and new business C&I fuel volumes (ML) C&I EBITDA (RC)2 5,876 231 238 5,336 682 4,634 677 4,312 571 1,569 164 538 1,232 712 805 106 2,922 3,150 3,326 2,777 285 336 277 299 1H21 1H22 1H23 1H2
Slide 8: Energy & Infrastructure (E&I)
Energy & Infrastructure (E&I) Operating at near capacity as regional refining margins remained above historical averages Refining production (%) E&I EBITDA (RC)2 371 18% 17% 12% 23% Other 3% 5% 9% 10% 112 44 23 Jet 38% 43% 41% 29% Diesel 1H21 1H22 1H23 1H24 Gasoline 37% 38% 41% 36% 1H21 1H22 1H23 1H
Slide 9: Financial Performance
Financial Performance Carolyn Pedic Viva Energy Group Limited – 1H2024 Results Presentation 9
Slide 10: 1H2024 Financial Performance
1H2024 Financial Performance C&I and E&I segments support 25% EBITDA growth, with strong cash conversion 1H2024 Group Results 1H2024 Group EBITDA (RC) bridge ($M) All financials in $M unless noted Change 1H2024 1H2023 otherwise (%) (#) EBITDA (RC) 451.7 361.9 24.8% 89.8 EBIT (RC) 338.3 275.8 22.7% 6
Slide 11: 1H2024 Convenience & Mobility (C&M)
1H2024 Convenience & Mobility (C&M) A transitional period for the business amid a soft retail environment Pro-forma 1H2024 C&M EBITDA (RC) bridge ($M) Higher fuel margins more Includes -$6.6M Includes one-off transition costs than offset lower fuel volumes tobacco impact of up to $13M associated wit
Slide 12: 1H2024 Commercial & Industrial (C&I)
1H2024 Commercial & Industrial (C&I) Acquisitions and strong sales growth supported higher earnings in 1H2024 1H2024 C&I EBITDA (RC) bridge ($M) New business wins and OTR WFB, Skyfuel, existing volume growth Bitumen, higher Cost inflation Advanced Polymers freight costs Viva Energy Group Limited – 1
Slide 13: 1H2024 Energy & Infrastructure (E&I)
1H2024 Energy & Infrastructure (E&I) Operating near full capacity following extended turnaround 1H2024 E&I (RC) bridge ($M) GRM affected by polypropylene plant outage Higher intake (4.4MBBL) and plant availability Lower operating costs following extended turnaround in 2Q23, however coastal shipping
Slide 14: 1H2024 Cash Flow
1H2024 Cash Flow Strong cash flow conversion during a period of disciplined investment Group net cash flow bridge ($M) Includes $16.6M of C&M Includes $21.5M of C&M acquisition integration costs acquisition integration capex 1 2 Underlying free cash flow ($M) 3 1. One-off costs of -$22.4M, treasury
Slide 15: Capital Expenditure & Balance Sheet
Capital Expenditure & Balance Sheet Lower capital spend to reflect current phasing over 2024/25 and capital discipline, maintaining capacity for growth initiatives Change in net debt (debt) ($M) • Capex $123M in 1H24, net of federal government funding2 and including C&M integration costs of $22M • F
Slide 16: Dividends
Dividends Determined fully franked dividend of 6.7 CPS in 1H2024 1H2023 1H2024 • Determined final fully franked dividend of 6.7cps, All financials in $M unless representing a 70% payout ratio of C&M and C&I NPAT (RC) Group C&M C&I E&I Group noted otherwise • Reflects continued strong cash conversion
Slide 17: OTR Strategic Update, Group Outlook
OTR Strategic Update, Group Outlook Scott Wyatt Viva Energy Group Limited – 1H2024 Results Presentation 17
Slide 18: C&M Integration Progressing Well
C&M Integration Progressing Well Significant opportunity in combining businesses to support earnings growth 2024 2025 2026 $60M+ synergies p.a. target in 3 years post completion of the OTR acquisition on track Above- Rationalise >$300M of total overheads (restructuring, marketing, above store • Over
Slide 19: OTR Store Performance Outside South Australia
OTR Store Performance Outside South Australia Industry-leading sales per store nationwide Extending OTR convenience offer provides significant Fuel & convenience store operating metrics excl. QSR (p.a.) uplift opportunity 12 mths to 30 June 2024 • Outside of SA, OTR (excl. QSR)2 generates $2.5M of c
Slide 20: Store Conversion and Growth Pipeline Plans
Store Conversion and Growth Pipeline Plans Continued progress on opening new stores with Express store upgrades commencing from 4Q2024 Expect to convert 30 stores to OTR format within next 12 months • First 30 conversions are a cross-section of existing Express store formats to test, learn and adapt
Slide 21: 2024 Outlook
2024 Outlook Distinct opportunities to outperform amid a more challenging environment • Established an experienced, high quality leadership team to lead consolidated business Convenience • Priority focus on integrating businesses to capture cost synergies from FY25 & Mobility • Fuel and convenience
Slide 22: Appendix
Appendix Viva Energy Group Limited – 1H2024 Results Presentation 22
Slide 23: Why Invest in Viva Energy
Why Invest in Viva Energy Strategic infrastructure and capability provide an enduring competitive advantage Convenience Commercial Energy and and Mobility and Industrial Infrastructure Extending a world-class convenience offering Excelling in high-touch relationships with Strategically important inf
Slide 24: Well Positioned for Energy Transition
Well Positioned for Energy Transition Supporting customers’ transition to low-carbon fuels across our industry exposure Resources Transport Agriculture Industry Aviation Defence Shipping • Diesel • Jet fuel • Diesel • Marine diesel Current fuel • Avgas • Military grade • MFO, VLSFO fuels Low carbon
Slide 25: Commercialising lower carbon energy options for customers
Commercialising lower carbon energy options for customers Building capability in a disciplined manner, supported by partnerships and government funding EV Charging Hydrogen • Premium, fast charge solution to be installed at ~30 • Public green hydrogen refueling station under OTR/Express convenience
Slide 26: Gas Terminal Project
Gas Terminal Project Project could deliver gas for winter 2028 to meet projected gas shortfall Projected gas shortfall – Southern Regions2 Regulatory approval as priority Targeted Geelong Gas - Proceeding with supplementary EES1 Terminal delivery date 500 450 400 Final Investment Decision (end-2025)
Slide 27: Convenience & Mobility – Sales Analysis and Key Drivers
Convenience & Mobility – Sales Analysis and Key Drivers 1H2024 incorporates 3 months of OTR Group Metric 1H2024 Company operated fuel & convenience stores (Express/OTR) # 890 OTR stores (including stand-alone stores) # 241 Liberty Convenience stores # 103 Dealer Owned stores # 538 Diesel sales ML 1,
Slide 28: 1H2024 Capital Expenditure and Depreciation & Amortisation
1H2024 Capital Expenditure and Depreciation & Amortisation Capital expenditure Depreciation & Amortisation 1H2024 1H2024 actual ($M) actual ($M) Convenience & Mobility 25.7 Convenience & Mobility 41.0 Commercial & Industrial 17.5 Commercial & Industrial 32.1 Energy & Infrastructure 39.1 Energy & Inf
Slide 29: Refinery – Margin Analysis and Key Drivers
Refinery – Margin Analysis and Key Drivers Metric FY20 FY21 FY22 FY23 1H23 1H24 A: A$/US$ FX 0.69 0.75 0.70 0.67 0.68 0.66 B: Crude and feedstock intake mbbls 34.8 41.2 41.9 31.6 16.2 20.6 C: Geelong Refining Margin US$/bbl 3.1 7.1 17.1 9.8 10.8 10.8 D: Geelong Refining Margin = C / A A$/bbl 4.4 9.4
Slide 30: Refining Margin Cracks
Refining Margin Cracks Refining margin cracks1, GRM2, Crude Premia3 (US$/bbl) 60 50 40 30 20 10 0 -10 Jun-19 Dec-19 Jun-20 Dec-20 Jun-21 Dec-21 Jun-22 Dec-22 Jun-23 Dec-23 Jun-24 Gasoline Diesel Jet GRM Crude Premia 1. Cracks are calculated by Viva Energy by taking the finished product prices and de
Slide 31: Glossary
Glossary Replacement Cost (“RC”) EBITDA (RC) Historical Cost (“HC”) Geelong Refining Margin Viva Energy reports its performance Profit before interest, tax, depreciation Calculated in accordance with IFRS The Geelong Refining Margin is a on a “replacement cost” (RC) basis. and amortisation adjusted
Slide 32: VivA
VivA EnergyAustralia