Viva Energy has provided a 4Q2023 update and predicted FY2023 earnings, with fuel and convenience sales both performing strongly.
Unaudited Group EBITDA (RC) for FY2023 is expected to be approximately $710 million in FY2023, supported by strong performances in the Convenience and Mobility (C&M) and Commercial & Industrial (C&I) businesses.
C&M achieved total sales of $317 million and a gross margin of 35.7 per cent, offsetting declining tobacco sales with strong growth in other categories. Although fuel sales were marginally down (-0.8 per cent versus 4Q2022) as elevated fuel prices weighed on mobility, falling product prices bolstered retail fuel margins after the significant compression experienced in 3Q2023.
Group fuel sales volumes increased by 8.3 per cent in 4Q2023 compared to the same period last year, led by particularly strong growth from C&I, which grew sales by 12.4 per cent to 2,941ML – its best quarterly result on record.
Sales growth in C&I was driven by the sustained recovery in the international aviation sector, continued growth from most other sectors, and a contribution from the Australian Defence Force (ADF) business after securing the contract in July 2023.
The refinery returned to normal operations following extended major maintenance, with crude intake ramping up to full capacity over the quarter. However, this coincided with a period of weaker regional refining margins, elevated crude premia and outsales of surplus intermediate feedstocks resulting from the extended turnaround, driving a GRM of US$8.8/BBL in 4Q2023, down from US$15.1/BBL in 4Q2022.