Ampol Limited · ASX:ALD
Ampol — H1 2022 Earnings Presentation
47 slides from Ampol's earnings presentation, Aug 22, 2022
Slide 1: 2022 Half Year Results Presentation
AMPOL LIMITED ACN 004 201 307 29-33 BOURKE ROAD ALEXANDRIA NSW 2015 ASX/NZX Release 2022 Half Year Results Presentation Monday 22 August 2022 (Sydney): Ampol Limited provides the attached 2022 Half Year Results Presentation for the half year ended 30 June 2022. Authorised for release by: the Board o
Slide 2: Welcome and overview
2 Welcome and overview Matt Halliday Managing Director & CEO
Slide 3: Safety performance maintained
3 Safety performance maintained Fuels and Infrastructure personal safety Process safety and spills1 Convenience Retail personal safety 15 15 15 10 10 10 5 5 5 0 0 0 2019 2020 2021 1H 2022 2019 2020 2021 1H 2022 2019 2020 2021 1H 2022 Days Away from Work Injury Frequency Rate Spills >1bbl and Marine
Slide 4: 1H 2022 highlights
4 1H 2022 highlights First half RCOP EBITDA of $927 million, RCOP EBIT of $734 million Unprecedented strength in Lytton Refiner Margin Record financial performance Strong shop performance First half total sales volume of 11.5 billion litres Deleveraging post acquisition Leverage at 2.6 tim
Slide 5: Successfully managing through significant disruption
5 Successfully managing through significant disruption Global energy markets have experienced significant dislocation causing increased volatility and record high fuel prices. Local markets have been further impacted by extreme weather and COVID-19. Against this backdrop Ampol has delivered a strong
Slide 6: Growing fuel sales to end customers
6 Growing fuel sales to end customers Ampol’s total fuel sales grew by 4.0% in the half as the recovery in jet demand and addition of Z Energy fuel sales offset lower international sales and weaker retail demand Ampol Sales Volumes (BL) Australian wholesale volume 11.50 11.05 Ampol’s Australian wh
Slide 7: Group financial result
7 Group financial result Greg Barnes CFO
Slide 8: 1H 2022 Group financial performance
8 1H 2022 Group financial performance Record second quarter refiner margins supported record first half Group RCOP EBIT Restated 1H 2022 1H 2022 % Δ 1H 2021 Record Group first half RCOP EBIT 1H 2021 Group1 Continuing1 Group Group1 F&I RCOP EBIT growth across Lytton, F&I Australia (ex-Lytton) and
Slide 9: 1H 2022 Group RCOP EBIT result
9 1H 2022 GROUP RCOP EBIT result Unprecedented refiner margin strength during 2Q 2022 led to record first half earnings more than offsetting retail fuel headwinds 1H 2022 v 1H 2021 Group RCOP EBIT ($M) 927 393 (26) 29 (8) 38 (193) 734 333 2Q 2022 501 60 1Q 2022 186 315 1H 2021 D&A 1H 2021 RCOP Lytto
Slide 10: Fuels & Infrastructure result
10 Fuels & Infrastructure result Strong F&I result due to material improvement in Lytton and F&I international earnings; investing in Future Energy 1H 2022 v 1H 2021 F&I RCOP EBIT ($M) 704 5 2 43 (12) (87) 617 393 274 90 184 1H 2021 F&I 1H 2021 F&I D&A 1H 2021 F&I Lytton EBITDA F&I Aust (Ex Future E
Slide 11: F&I Australia (ex Lytton)
11 F&I Australia (ex Lytton) Modest recovery in F&I Australia (ex-Lytton) earnings despite the volatile market as commercial volumes recover F&I Australia (ex-Lytton)1 EBIT ($M) F&I Australia (ex Lytton) RCOP EBIT up 2.6% compared with 1H 2021 2.6% Earnings from the Australian wholesale business
Slide 12: F&I International
12 F&I International Market dynamics created attractive trading opportunities F&I International EBIT ($M) F&I International (excluding Gull) RCOP EBIT rose 190% Trading and Shipping Gull 41.0 Enhanced capability for international storage and blending to service international third party customer
Slide 13: Retail key metrics
13 Retail key metrics Strong shop performance partially offset softer fuel demand and weaker margins that lowered fuel net available margin Retail fuel volume Network KPIs Fuel margin impacted by headwinds from rising oil and product prices 1,891 ML 668 LFL fuel sales volume impacted by flooding
Slide 14: Convenience Retail result
14 Convenience Retail result Shop strategy continues to gain traction; weather events and high pricing impacted fuel demand 1H 2022 v 1H 2021 Convenience Retail RCOP EBIT ($M) 237 (26) 211 (13) 7 6 87 (83) 149 127 1H 2021 CR 1H 2021 D&A 1H 2021 CR Fuel volume Fuel margin Shop contribution Cost of do
Slide 15: Z Energy acquisition completed
15 Z Energy acquisition completed Transaction completed on 10 May 2022 Committed to retaining Z Energy iconic brand and confident of delivery of anticipated benefits estimated to be NZ$60-80 million per annum Transition to full import model largely complete with import supply chain stabilising
Slide 16: Balance sheet and cash flow
16 Balance sheet and cash flow Strong balance sheet maintained; maximising value and shareholder returns (98) 349 (123) (432) 55 (70) 474 (150) Includes adverse working Includes $94m for Z Energy capital movement of prior year tax liability ~$840m reflecting higher (1,785) crude and product prices (
Slide 17: Strategy update
17 Strategy update Matt Halliday Managing Director & CEO
Slide 18: Making good progress on our 2022 strategic priorities
18 Making good progress on our 2022 strategic priorities • 1,285 sites rebranded1. Settlement with EG during the period allowed rebrand of their network to Complete network rebrand commence, with completion expected by end 2022 ENHANCE and evolve the Ampol brand • Lytton clean fuels project progress
Slide 19: Energy transition strategy is evolving as we learn more
19 Energy transition strategy is evolving as we learn more Our strategy is to transition with our customers. We continue to adjust our approach through a series of test and learns Development phase Low carbon solution Test and Learn Scale up/Pause Commenced rollout of AMPCharge branded EV fast charg
Slide 20: Outlook and closing remarks
20 Outlook and closing remarks Matt Halliday Managing Director & CEO
Slide 21: Global refining supply demand balance remains tight
21 Global refining supply demand balance remains tight Limited refining capacity additions planned with near term capacity of greenfield refinery builds primarily focused on China’s domestic consumption Global Refining Net Additions and Utilisation1 Significant structural refinery closures during
Slide 22: Well positioned to benefit from fuel demand recovery
22 Well positioned to benefit from fuel demand recovery Petrol and jet demand remains below pre-COVID levels due to ongoing COVID-19 outbreaks and the trajectory of the recovery in air travel Regional fuel demand Overall Australian1 and New Zealand2 demand remains below pre-COVID levels as the rec
Slide 23: 2H 2022 Trading conditions
23 2H 2022 Trading conditions Ampol is well positioned to manage the continued volatility in global energy markets Lytton refinery Convenience Retail Lytton refiner margin eased in July from the peak levels of the second quarter to Retail margins improved in July as refined products costs eased,
Slide 24: Q&A
a P j Q&A
Slide 25: Appendix
Appendix 25 Our integrated platform creates opportunities 26 1H 2022 key Group Metrics 27 Reconciliation of restatements and continuing operations 28 Product sales volumes 29 Fuels & Infrastructure – Financial highlights 30 Singapore Weighted Average Margins 31 Lytton refinery key metrics 32 Lytton
Slide 26: Our integrated platform creates opportunities
26 Our integrated platform creates opportunities The integrated value chain of the traditional fuels business provides a pathway to pursue mobility energy B2B 9.2BL Reporting segments Integration benefits Australian F&I (ex Lytton and FE) Earnings are diversified by Manufacturing participation acr
Slide 27: 1H 2022 key Group metrics
27 1H 2022 key Group metrics1 Strong improvement in financial performance in second COVID-19 impacted year Profit metrics Balance Sheet metrics Sales volume Capital management $927 m $2,976 m 11.50 BL 120 cps Group RCOP EBITDA up 85% Net borrowings2 Total sales volume up 4.0% Interim dividend declar
Slide 28: Reconciliation of restatements and continuing operations
28 Reconciliation of restatements and continuing operations 1H 2022 1H 2021 Previous RCOP Methodology Financial results1 Restated Less 1H 2022 1H 2022 1H 2022 1H 2021 1H 2021 Reported 1H 2021 externalities Group Continuing Discontinued Continuing Discontinued 1H 2021 Group FX Group RCOP EBITDA 927.3
Slide 29: Product sales volumes
29 Product sales volumes F&I (Australia) Volumes F&I (International) Volumes CR Fuels Volumes Z Energy Fuels Volumes1 BL BL BL BL 10.00 5.00 3.00 0.80 4.50 9.00 4.50 4.21 8.11 2.50 2.42 0.70 8.00 0.01 4.00 0.04 1.33 0.60 1.34 6.97 1.99 2.05 7.00 6.68 3.50 1.21 0.60 0.00 6.55 2.00 0.72 0.03 0.02 1.89
Slide 30: Fuels & Infrastructure – Financial highlights
30 Fuels & Infrastructure – Financial highlights 1H 20226 1H 20216 Change (%) Notes Total Sales Volumes (BL) (excluding Z Energy) 10.89 11.05 (1.4%) Australian Sales Volumes (BL) 6.68 6.55 2.1% 1. F&I Australia (ex Lytton) includes all earnings and costs associated (directly International Sales Volu
Slide 31: Singapore Weighted Average Margins
31 Singapore Weighted Average Margins Product cracks reached unprecedented levels as post-COVID demand recovery coincided with supply shocks and low northern hemisphere inventory levels. They remain volatile, easing in July Singapore Weighted Average Margin (US$/bbl) MOPS Product Pricing and Dated B
Slide 32: Lytton refinery key metrics
32 Lytton refinery key metrics Lytton Refiner Margin1 Operational performance LRM (US$/bbl and Acpl) BL High Value Production Volumes, Production Utilisation (%) 29.0 3.50 84 87 86 % 79 78 3.00 80 2.50 55 60 2.00 43 32.96 9.7 1.50 2.82 2.88 3.01 2.89 40 9.2 2.66 5.1 5.8 1.00 1.97 4.4 4.5 1.45 20 11.
Slide 33: Lytton Refinery result
33 Lytton Refinery result Unprecedented strength in Singapore product cracks delivered record LRM in the second quarter, lifting Lytton’s earnings 1H 2022 v 1H 2021 Lytton RCOP EBIT ($M) 476 (7) 39 (32) 444 402 49 43 (1) (40) 33 1H 2021 TRPP 1H 2021 D&A 1H 2021 RCOP Volume USD LRM Impact of Opex & o
Slide 34: Convenience Retail – Financial highlights
34 Convenience Retail – Financial highlights 1H 20227 1H 20217 Change (%) Notes Period end COCO sites (#)1 660 688 (4.1%) Period end CORO sites (#) 8 9 (11%) 1. Includes 37 unmanned diesel stops down from 38 in FY 2021 Total sales volumes (BL) 1.89 2.05 (7.5%) 2. Excludes GST and excise (as applicab
Slide 35: Retail key metrics
35 Retail key metrics Strong shop performance helped to partially offset the weaker earnings from fuel sales which were affected by COVID-19, extreme weather and high prices Total Fuel and Shop Margin ($M) Convenience Retail Fuel Volumes (BL) 2.42 -7.5% 1.99 2.05 1.89 385 378 339 345 1H 2019 1H 2020
Slide 36: Z Energy – Financial highlights
36 Z Energy – Financial highlights 1H 20221 Retail sales volume (ML)2 230 Notes Commercial sales volume (ML) 329 1. 1H 2022 result represents the Ampol period of ownership from Supply terminal and export sales (ML) 44 May 2022 Total sales volumes (ML) 603 2. Retail sales volume includes sales throug
Slide 37: Our assets – Retail infrastructure
37 Our assets – Retail infrastructure Ampol Australian retail network Ampol Australian retail network Leased- Dealer Dealer Site rationalisation continues with site count down from 1,881 at 31 Owned Leased Total2 APT1 Agency owned December 2021 and 1,863 at 30 June 2022; 8 franchise sites remain t
Slide 38: Disciplined capital allocation
38 Disciplined capital allocation Continued focus on operating and capital efficiency, governed by a well-defined Capital Allocation Framework Capital Allocation Framework Ampol is committed to maintaining a strong investment grade credit rating; currently Baa1 from Moody’s Investors Service Stay-
Slide 39: Capital Expenditure and Depreciation & Amortisation
39 Capital Expenditure and Depreciation & Amortisation Capital Expenditure1 RCOP Depreciation & Amortisation 1H 2022 1H 2021 1H 2022 1H 2021 ($M) ($M) ($M) ($M) Lytton 18.6 10.2 Convenience Retail 83.2 87.5 Fuels & Infrastructure (ex Lytton)2 16.3 13.1 Fuels & Infrastructure2 77.9 80.8 Future Energy
Slide 40: Strong funding and liquidity platform
40 Strong funding and liquidity platform Underpinned by a strong investment grade credit rating of Baa1 from Moody’s Investors Service Prudent debt maturity profile to minimise refinancing risk and maintain financial flexibility Committed Debt Maturity Profile (A$m) ꟷ $5.9 billion of committed deb
Slide 41: Significant items
41 Significant items Notes Half Year Ending June 1H 2022 1H 2021 ($M) ($M) 1. $21.8 million Ampol rebranding expense comprises $19.9 million for rebranding program and $1.9 million accelerated depreciation compared to $26.6 million recognised at half year 2021 comprising $20.8 million rebranding pro
Slide 42: Sustainability is an integral part of our strategy
42 Sustainability is an integral part of our strategy Launched Ampol Sustainability Ambassador program to help build a supportive culture and to advocate for sustainable practices across the business Reducing emissions from Western Australian retail sites through 100% renewable energy supply agree
Slide 43: Ampol rebranding – Re-establishing iconic Australian brand
43 Ampol rebranding – Re-establishing iconic Australian brand 2H 2020 1H 2021 2H 2021 2022 Timeline Pilot launch Network rollout commenced Multi-channel brand campaign Brand transition complete Rebrand program on track 1,285 sites completed including 10 EG Group sites, brand transition will comple
Slide 44: AMPCharge EV charging network rollout
44 AMPCharge EV charging network rollout 1H 2022 2H 2022 and 1H 2023 2H 2023 2027 Timeline Brand launch and pilot sites Installation of Tranches 1 and 2 ARENA program complete >500 EV charging bays AMPCharge brand launched in April 2022 to provide charging services at home, at destination and at t
Slide 45: Glossary
45 Glossary $ - Australian Dollar k – Thousand ARENA – Australian Renewable Energy Agency kb/d – Thousand barrels per day bbl – Barrel (equivalent of approximately 159 litres) m – Million BL – Billion litres mb/d – Million barrels per day B2B – Business to business MOPS – Mean of Platts Singapore is
Slide 46: Important Notice
46 Important Notice This presentation for Ampol Limited Group is designed to provide: • an overview of the financial and operational highlights for the Ampol Limited Group for the six-month period ended 30 June 2022; and • a high level overview of aspects of the operations of the Ampol Limited Group
Slide 47: Thank you
VA AMPOL Thank you