Ampol Limited · ASX:ALD
Ampol — Shareholder Meeting (February 2016)
61 slides from Ampol's shareholder meeting presentation, Feb 11, 2016
Slide 1: ASX Announcement: 2013 Full Year Results Media Release and Presentation and 2014 AGM
BY ELECTR RONIC LOD DGEMENT A ASX ANNOU UNCEMENT CALTEX A AUSTRALIAA LIMITED CN 004 201 307 AC LEVEL 24 4, 2 MARKET T STREET SYDNEY NNSW 2000 AUSTRALIA A 24 Februarry 2014 Company A Announcem ments Office e Australian Securities Exchange E CALTEX A AUSTRALIA A LIMITED 2013 FULL L YEAR RE ESULTS ME E
Slide 2: ASX/Media Release: Marketing growth continues; Kurnell conversion on track
Ca altex Australia a ASX/M Media Release For imm mediate release r uary 2014 24 Febru Marketting gro owth con ntinues s; Kurne ell conversion o on track Key points: Full year historric cost proffit after tax (HCOP) of $530 $ million including ssignificant ittems P1 NPAT of $332 Full year RCOP $
Slide 3: Replacement cost operating profit
-2- Replacement cost operating profit On an RCOP basis, Caltex recorded an after tax profit for the 2013 full year of $332 million, excluding significant items. This compares with $458 million for the 2012 full year, excluding significant items. “Whilst Marketing has delivered another record result,
Slide 4: Full Year Results Announcement 2013
FULL YEAR RESULTS ANNOUNCEMENT 2013 ACN 004 201 307
Slide 5: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 2
Slide 6: Operational Excellence Moment
OPERATIONAL EXCELLENCE MOMENT 3
Slide 7: Operational Excellence Moment: Personal safety performance
Operational Excellence (OE) Moment Personal safety performance 10 8.82 9 8.35 • Sustained and 8 significant progress in personal safety results Per million hours worked 7 6 • Excellent outcomes 5 4.57 given significant 4 3.79 Kurnell Conversion 2.97 3.04 works and retail 2.83 3 2.53 network developm
Slide 8: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Summary Q&A Appendices 5
Slide 9: Key Highlights: Full Year 2013 Results Summary
Key Highlights Full Year 2013 Results Summary Resilient Marketing & $332m RCOP NPAT, excluding significant items Distribution performance Net significant items of $26 million, after tax Marketing up 4% to $764m, from record 2012 ($736m EBIT), despite impacts of Sydney premium gasoline supply i
Slide 10: Key Highlights: Outlook
Key Highlights Outlook Short Term • Competitive environment expected to continue • Lower AUD will benefit future Australian dollar refiner margins (any further deterioration in the AUD will have immediate negative earnings impact, but longer term benefit) • Prioritise the optimisation of the entire
Slide 11: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 8
Slide 12: Strategy Update: Caltex's strategy is clear
Strategy Update Caltex’s strategy is clear CALTEX’S VISION Outright leader in transport fuels across Australia MEASURE OF SUCCESS Safely and reliably deliver top quartile total shareholder returns KEY STRATEGY PILLARS Comprehensive targeted offer to customers across Superior supply chain products, c
Slide 13: Caltex Value Chain
Caltex Value Chain Our Competitive Position: To optimise the entire value chain Product sourcing Infrastructure Customer Controlled Retail Offshore supply agreement (Chevron) Woolworths Caltex Consumer sites sales Lytton Refinery Independent & branded resellers Terminals, tankers, pipelines, depots,
Slide 14: Growing close to our core: Transform, Improve, Grow
Strategy Update Growing close to our core (with expected lower earnings and cash flow volatility) TRANSFORM IMPROVE GROW • Kurnell closure on track for Lytton (Brisbane) Refinery • Continue to target growth in end 2014 • Operational Improvements Marketing • Conversion to Australia’s in progress • Ta
Slide 15: Strategy Update: Infrastructure
Strategy Update Infrastructure What we Target 2013 Achievements Marketing growth supported by commitment to infrastructure New South Wales Kurnell import terminal conversion continues on schedule and on budget. Refinery closure on track for 4Q 2014 South Australia Adelaide terminal completion ex
Slide 16: Strategy Update: Customer (Marketing)
Strategy Update Customer (Marketing) What we Target 2013 Achievements (EBIT growth of at least 5% ) Resilient earnings • EBIT $764m, up 4% on record 2012 ($736m EBIT) • Margins maintained in tough competitive market - Transport fuel marketing gross margin (4.41 cents/litre) consistent with prior yea
Slide 17: Kurnell Conversion – key milestones
Strategy Update Kurnell Conversion – key milestones Time Proposed Work Status 1H 2013 • Marine EIS submission / Public Exhibition Feb-Mar 2013 • Complete • Land EIS submission / Public Exhibition May-Jun 2013 • Complete • Demolition of Kurnell Propane De-asphalting Unit (PDU) • Complete • Draft Kurn
Slide 18: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 15
Slide 19: Financial Highlights
Financial Highlights Full Year Ending 31 December 2013 2012 % Change HISTORIC COST EBIT ($m) 826 183 350 NPAT ($m) 530 57 834 EPS (cps) 196 21 834 REPLACEMENT COST EBIT ($m) 551 756 (27) NPAT ($m) 332 458 (28) EPS (cps) 123 170 (28) 1 Dividend (cps) 34 40 (15) Debt ($m) 742 740 0 Gearing (%) 22 26 (
Slide 20: Reconciliation to underlying profit metric
Financial Highlights Reconciliation to underlying profit metric 2013 $m 2012 $m (After Tax) (After Tax) HCOP NPAT 530 57 Add: Inventory loss/(gain) (172) 92 Add: Significant items loss/(gain) (26) 309 RCOP NPAT 332 458 17
Slide 21: Significant Items
Financial Highlights SIGNIFICANT ITEMS 2013 Year ending December ($m) Gain on sale of bitumen business, net of costs relating to 39 acquisitions and disposals. Net adjustments to provisions relating to closure of Kurnell refinery (11) Tax impact (2) Net gain (after Tax) 26 2012 Year ending December
Slide 22: Segmented Reporting: 2012 vs 2013 HCOP EBIT
Financial Highlights Segmented# Reporting 2012 vs 2013 HCOP EBIT 900 798 800 132 756 246 259 700 625 600 26 551 28 500 400 300 200 100 0 #Segment results are based on a transfer price between Refining & Supply and Marketing & Distribution determined by reference to relevant import parity prices for
Slide 23: RCOP Earnings, half on half
Financial Highlights RCOP Earnings, half on half $m • Resilient Marketing & Caltex RCOP NPAT* Distribution earnings 500 450 • Refining & Supply adversely impacted by externalities - 400 Caltex Refiner Margin (CRM 350 price down $94m on 2012), net 261 FX losses (-$69m), 7-day lag 26 300 (-$33m) (pre-
Slide 24: Segmented Reporting: RCOP EBIT
Financial Highlights Segmented# Reporting RCOP EBIT* 1,000 Refining & Supply segment includes exchange impacts (before tax) on payables in: • FY09 of $92m gain 800 • FY10 of $27m gain 736 764 • FY11 of ($2m) loss 756 600 697 • FY12 of ($8m) loss • FY13 of ($78m) loss 578 551 400 Note: Active hedging
Slide 25: Integrated Transport Fuels Margin
Integrated Transport Fuels Margin Unfavourable externalities (lower CRM led) impact integrated transport fuel margins; Marketing margins maintained Caltex Integrated Gross Transport Fuels Acpl Margin* 13.00 • Integrated transport fuels 11.57 margin down 10% to 10.6 10.42 10.42cpl (2H refiner margin
Slide 26: Agenda
AGENDA AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 23
Slide 27: Marketing & Distribution Highlights
Marketing & Distribution Highlights Resilient result despite competitive environment, one offs. Growth continues $m Marketing Gross Contribution 1200 • Continued investment to grow Marketing • Transport Fuels contribution 1000 (+4.4%) despite 1H one-offs 175 (-$11m); Volumes +2.0% 184 180 • Highly c
Slide 28: Marketing & Distribution – Key Drivers
Marketing & Distribution Growth Marketing & Distribution – Key Drivers Marketing & Distribution $m 800 2012 vs 2013 RCOP EBIT 790 780 770 30 764 6 760 6 9 7 5 750 9 740 736 730 720 710 700 25
Slide 29: Continued Premium Fuels Growth
Marketing & Distribution Highlights Continued Premium Fuels Growth BL Caltex Gasoline Sales • Premium gasoline sales up 3.0% 8.0 (trending at +5.0% prior to 1H Sydney premium gasoline supply 7.0 interruption); now represents 28% 0.4 of total gasoline sales 0.8 6.0 1.1 1.0 1.1 0.9 • Total gasoline vo
Slide 30: Diesel, jet fuel sales – strong second half volume growth
Marketing & Distribution Highlights Diesel, jet fuel sales – strong second half volume growth Caltex Diesel, Jet Sales • Total diesel volumes up 5.8% on BL FY 2012 11.0 • Vortex retail diesel sales up 24% on 10.0 2012 in total (underlying retail diesel growth +7.8%) and now 9.0 2.6 represents 23% of
Slide 31: Non Fuel Income
Marketing & Distribution Highlights Non Fuel Income: Accelerated investment impacts timing of returns $m Caltex Non Fuel Income 400 • Non fuel income contribution 350 down 5.0% on FY12 300 • Accelerated investment costs 250 (including increased leased sites) 261 259 232 250 exceeds recovery via incr
Slide 32: Marketing & Distribution: Other Developments
Marketing & Distribution Other Developments • Network development continues − New to Industry / New to Caltex retail outlets: Target ~10-15 sites p.a.; Completed 13 − Retail site knock down rebuilds (including 21CC Retail fit-out): Target ~15-20 sites p.a.; Completed 24 − New diesel stops: Target ~1
Slide 33: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Outlook & Summary Q&A Appendices 30
Slide 34: Refining & Supply Highlights
Refining & Supply Highlights External drivers (unfavourable CRM, Net FX losses, 7 day lag) and higher depreciation account for 80% of adverse year on year earnings change Refining & Supply 250 2012 vs 2013 RCOP EBIT 200 Prior year closure EXTERNAL DRIVERS CONTROLLABLE DRIVERS Includes accelerated re
Slide 35: Lower CRM adversely impacts R&S EBIT result
Refining & Supply Highlights Lower CRM adversely impacts R&S EBIT result by $94m The CRM was reduced by a market price Caltex Refiner Margin timing lag of US ($0.45)/bbl (A$33.2m EBIT) in FY13 Build-up (US$bbl) FY13 FY12 Singapore WAM* 13.20 14.49 Product freight 5.12 4.77 Quality premium 1.94 2.07
Slide 36: Supply Chain Highlights: Caltex Refiner Margin
Supply Chain Highlights Lower Caltex Refiner Margin exacerbated by higher crude premium and lower yield recovery 2007-2013 Caltex Refiner Margin*1 (US$/bbl) • Significant 2H Singapore 25 weighted average margin decline • Higher crude premium partially 20 offset by improved freight differential (lowe
Slide 37: Improved freight differential
Refining & Supply Highlights Improved freight differential driven by higher product freight rates, lower crude freight costs and positive impact of fewer long haul cargoes on crude freight USD/bbl 6.00 • Product freight rates continue 5.00 to rise on higher regional product shipping demand (up 4.00
Slide 38: Refinery production and utilisation
Refining & Supply Highlights Production and mechanical availability maintained despite unplanned Lytton outage, Lytton utilisation down slightly, and Kurnell conversion works Refinery transport fuel production Refinery utilisation (%) and Availability (%) BL % 12 100 96 96 94 95 96 10.68 10.64 10.17
Slide 39: Enhanced Product Mix
Enhanced Product Mix Record production of higher value products* despite outages ML % 1,800 16 • Premium gasolines represent an increasing proportion of refined 1,600 14 production 1,574 1,585 1,400 12 • Reflects the conscious decision 1,200 to target higher value products, 10 address major producti
Slide 40: Refining & Supply Production: product slate
Refining & Supply Production Lytton’s product slate (% of total volumes) assists Refinery earnings differential LYTTON KURNELL 2013 2012 2011 2010 2013 2012 2011 2010 Diesel 39% 40% 38% 39% 29% 26% 26% 26% Premium Gasolines 12% 13% 12% 10% 16% 14% 10% 10% Jet 10% 10% 9% 7% 20% 19% 18% 18% 61% 63% 59
Slide 41: Refining & Supply Result Composition
Refining & Supply Lytton profitable / cash flow positive despite adverse externalities, higher depreciation Refining & Supply Result Composition • Lytton performed well EBIT ($ millions) FY13 FY12 operationally, excluding Lytton EBIT 95 178 May unplanned outage Kurnell EBIT (21) 61 • Strong Kurnell
Slide 42: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Summary Q&A Appendices 39
Slide 43: Capital Expenditure
Capital Expenditure Capital directed to growing Marketing & Distribution business $m Caltex Capex Spend • 2013 total capex $568m, in line with the previously disclosed 600 forecast $570m - $605m range 568 • Marketing growth investment 500 includes: (i) Acquisition of Qld. 400 420 reseller ($40m); 40
Slide 44: Financial Discipline: Indicative Capital Expenditure
Financial Discipline Indicative Capital Expenditure, subject to change (includes T&I**) $ millions Average 2012 2013 Forecast 2013 Actual 2014 Forecast (FY10-12 inclusive) Marketing & Distribution - Stay in business 75 96 110 108 120-130 - Growth* 130 125 165-185 173 220-240 205 221 275-295 281 340-
Slide 45: Less Long Haul Crude reduces Average Debt
Financial Discipline Less Long Haul Crude reduces Average Debt % $m Period end debt and gearing* $m Caltex net debt levels** 900 40 2500 800 832 35 700 742 2000 740 30 600 617 25 1500 500 544 487 20 400 15 1000 300 10 200 500 100 5 0 0 0 Dec‐08 Dec‐09 Dec‐10 Dec‐11 Dec‐12 Dec‐13 Net Debt Gearing Gea
Slide 46: Working Capital – The WAF Effect
Financial Discipline WORKING CAPITAL – THE WAF* EFFECT 43 *WAF = West African Sourced Crude
Slide 47: Dividend
Dividend Final dividend of 17 cents per share (2012: 23cps) Caltex dividend history^ Cents per share Payout Ratio^^ 70 60% 60 60 50% 50 30 45 40 40% 40 36 34 30% 30 25 28 23 17 30 20% 20 25 17 17 17 10% 10 36 0 0% 2008 2009 2010 2011 2012 2013 Interim Dividend Final Dividend Payout % ^ Dividends dec
Slide 48: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 45
Slide 49: Result Summary & Outlook
RESULT SUMMARY & OUTLOOK RESULT TAKE-AWAYS • Result within recent profit guidance • Marketing earnings growth continues, despite competitive environment • Refining & Supply losses – adversely impacted by unfavourable externalities (lower CRM, currency impact on USD payables, 7 day lag), higher depre
Slide 50: Q&A
Q&A 47
Slide 51: Agenda
AGENDA Safety Full Year 2013: Key Highlights Strategy Update Financial Highlights Marketing & Distribution Highlights Refining & Supply Highlights Financial Discipline Result Summary & Outlook Appendices 48
Slide 52: Appendix – Australian Demand Growth
Appendix – Australian Demand Growth Continued demand growth for Diesel and Jet Fuel • Longer-term transport CAGR CAGR ‘81-’90 CAGR ‘05-’13 CAGR fuels demand outlook BL ‘90-’05 ‘13-’20 remains favourable 35 3.5% to 4.5% • Diesel demand 30 underpinned by GDP 25 growth and gasoline 20 0.7% -0.7% -1% to
Slide 53: Appendix – Regional Supply Capacity
Appendix – Regional Supply Capacity Regional refining utilisation expected to decline medium term Net Additions Asia Pacific Product Balance • 2014 regional refining capacity additions kbd Crude Unit Utilisation will be partly offset by capacity closures in % 3,000 90 Japan (~400kbpd) and Caltex’s K
Slide 54: Appendix – Regional Supply and Demand
Appendix – Regional Supply and Demand Refining capacity additions are forecast to exceed product demand growth medium term Asia Pacific Product Demand Growth versus CDU Capacity Additions kbd • Regional product demand 2,500 growth in 2014 growth is projected to be similar to net refining capacity ad
Slide 55: Flexible balance sheet supports growth and company transformation
Financial Discipline Flexible balance sheet supports growth and company transformation Diverse funding sources, increased facilities, next refinancing ($73m, <5% of total facilities) April 2014 Current sources of funding Debt maturity profile A$m Source US$ notes 254 US institutional Australian and
Slide 56: Historical Capex Levels (2011–2013)
Financial Highlights HISTORICAL CAPEX LEVELS (2011 – 2013 INCLUSIVE) Total capex $465m Stay in business– $235m Growth ‐ $230m (3 year average) Refining & Supply Corporate Marketing and $220m $10m Distribution ($140m Stay in Business (Stay in Business (SIB)) $235m (SIB)) Kurnell Lytton Supply Stay in
Slide 57: Depreciation & Amortisation over time
Financial Discipline DEPRECIATION & AMORTISATION (D&A) OVER TIME Higher FY13 D&A reflects the useful life of refining assets generally, the finite life of the Kurnell refinery and the accelerated investment within Marketing & Distribution. Dec YE ($m) 2012 2013 2014* 2015* Refining & Supply 56 70 70
Slide 58: Kurnell Closure Cash-flow
Appendix Kurnell Closure Cash-flow Indicative Item Description Timing amount Closure costs Includes redundancy, $(430)m* Redundancies H2 2014 (pre-tax) decommissioning and Dismantling and removal 2015 remediation Remediation post removal Terminal conversion Conversion and $250m - Work commen
Slide 59: Volatility continues in Exchange Rates and Oil Prices
Appendix Volatility continues in Exchange Rates and Oil Prices USD/bbl Dated Brent Prices $130 $120 $110 $100 $90 $80 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2011 2012 2013 Source = Reuters 56
Slide 60: Summary Financial Information
Financials Summary Financial Information 2013 2012 2011 2010 2009 Dividends Dividends ($/share) 0.34 0.40 0.45 0.60 0.25 Dividend payout ratio - RCOP basis (excl. significant items) 28% 24% 46% 51% 21% Dividend franking percentage 100% 100% 100% 100% 100% Other data Total revenue ($m) 24,676 23,542
Slide 61: Important Notice
IMPORTANT NOTICE This presentation for Caltex Australia Limited is designed to provide: • an overview of the financial and operational highlights for the Caltex Australia Group for the 12 month period ended 31 December 2013; and • a high level overview of aspects of the operations of the Caltex Aust