In its announcement to the ASX on Thursday, Caltex Australia (ASX:CTX) announced a significant rise in first quarter profits and a renewed focus for its business. The company’s unaudited first quarter profit after tax came to $162m on a replacement cost of sales operating profit basis. This came in significantly higher than the $96m profit compared to the previous corresponding period. On a statutory, or historical cost, basis the unaudited first quarter profit after tax was $174m, including an inventory gain of $12m after tax. This compares to the $121m statutory first quarter profit from the previous corresponding period. Chief Executive Officer Julian Segal said the company has been trying its best over the past five years to adapt to a changing economy. “Our people have had to deal with unprecedented change over the last five years, and have delivered both record profitability and top quartile shareholder returns,” he said.
Caltex noted a significant change in its business. The closure of the Kurnell refinery and the establishment of Ampol Singapore to source its crude and refined products have signalled the changes. The company said it has evolved to be an integrated transport fuel supply chain business, while optimising its entire value chain from product sourcing to the customer. Mr. Segal also noted that the shift in its business model now focuses on growth. “Our focus is on leveraging our existing core capabilities in retailing, franchising, supply chain management, infrastructure services, and the processing, storage and distribution of hydrocarbons. This is what we are good at, therefore it makes sense for us to pursue these capabilities further, as areas of growth.”
Shares of CTX are down 34c, or .99 per cent, at $34.06 per share near the end of trading on Thursday. CTX has advanced 56.33 per cent in the last 12 months but has fallen .38 per cent so far this year.
Author: Imran Valibhoy
May 07, 2015
Since Joining the firm in 2006, Imran has worked on a range of M&A and Capital Market transactions in the natural resources, mining as well as projects in the renewable energy sector. Prior to joining Wise-owl, Imran worked at Euroz Securities in Perth, aiding in the advisory and valuation of companies in the mining and industrial sectors in Australia. Imran has a Masters in Banking & Finance from City University's Class Business School in London and a Bacheloor degree in Commerce from UWA.