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August 2015 Investor Presentation – Caltex Australia

Caltex Australia · Aug 24, 2015 · 56 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. August 2015 Investor Presentation – Caltex Australia – slide 1
    2015 Interim Results Announcement (6 Months to 30 June 2015) Caltex Australia Limited ACN 004 201 307
  2. August 2015 Investor Presentation – Caltex Australia – slide 2
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 2
  3. August 2015 Investor Presentation – Caltex Australia – slide 3
    OPERATIONAL EXCELLENCE MOMENT 3
  4. August 2015 Investor Presentation – Caltex Australia – slide 4
    Operational Excellence (OE) Moment 10 Reduction in LTIFR to record low 8.82 levels (despite increase in TTIFR) 9 Lytton Refinerys Turnaround & 8 Inspection (T&I) involved 400,000+ additional man hours (1,000 Per million hours…
  5. August 2015 Investor Presentation – Caltex Australia – slide 5
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Marketing Highlights Supply Chain Highlights Financial Discipline Result Summary & Summary Q&A Appendices 5
  6. August 2015 Investor Presentation – Caltex Australia – slide 6
    Key Highlights 2015 Interim Results Summary Consolidated Group Result RCOP NPAT 251 million, 45% above prior year RCOP NPAT 251 million Significant item of 29 million (after tax) from sale of surplus property Dividend 47.0 cps…
  7. August 2015 Investor Presentation – Caltex Australia – slide 7
    Key Highlights Outlook Short Term Continue to defend Business to Business market position (Next 12 months) Prioritise the optimisation of the entire value chain from product sourcing to customer - Continue to build Ampol product…
  8. August 2015 Investor Presentation – Caltex Australia – slide 8
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 8
  9. August 2015 Investor Presentation – Caltex Australia – slide 9
    Strategy Update A focused multi-year transformation strategyto deliver top quartile shareholder returns 11 Capital Management 10 Growth 10 9 9 Value Chain Optimisation 8 Tabula Rasa 7 Ampol Singapore 6 Distribution…
  10. August 2015 Investor Presentation – Caltex Australia – slide 10
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 10
  11. August 2015 Investor Presentation – Caltex Australia – slide 11
    Financial Highlights 2015 Interim Results Summary (for period ending 30 June) 1H2015 1H2014 % Change HISTORIC COST EBIT (m) 551 275 100 NPAT (m) 375 163 130 EPS (cps) 139 60 130 REPLACEMENT COST EBIT (m) 383 290 32 NPAT (m) 251 173 45…
  12. August 2015 Investor Presentation – Caltex Australia – slide 12
    Financial Highlights Reconciliation to underlying (RCOP) profit metric 1H 2015 m 1H 2014 m (After Tax) (After Tax) HCOP NPAT 375 163 Add: Inventory loss/(gain) (95) 10 Add: Significant items (gain) (29) 0 RCOP NPAT 251…
  13. August 2015 Investor Presentation – Caltex Australia – slide 13
    Financial Highlights Significant Items Period Ending June 1H 2015 1H 2014 M M Sale of surplus land 32 0 Total Significant Items (Before Tax) 32 0 Tax (3) 0 Total Significant Items (After Tax) 29 0 13
  14. August 2015 Investor Presentation – Caltex Australia – slide 14
    Financial Highlights Segment Reporting m 1H 2014 v 1H 2015 HCOP EBIT 800 700 600 136 551 500 32 115 3 383 400 15 290 24 300 275 200 100 0 14
  15. August 2015 Investor Presentation – Caltex Australia – slide 15
    Financial Highlights Integrated Supply and Marketing result resilient in challenging B2B market; Strong operational performance allows Lytton to capture strong refiner margins Lytton profitability up 115 million to 154 m million.…
  16. August 2015 Investor Presentation – Caltex Australia – slide 16
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 16
  17. August 2015 Investor Presentation – Caltex Australia – slide 17
    Supply & Marketing Highlights Reporting framework change reflecting integrated supply chain business model Kurnell Refinery Integrated Supply Chain 1H14 1H15 Lytton Refinery Corporate 2014 2015 Marketing & Distribution 393 2014 2015…
  18. August 2015 Investor Presentation – Caltex Australia – slide 18
    Supply & Marketing Highlights - Key Drivers Adverse externalities and one-off supply costs impact resilient earnings 1H 2015 v 1H 2014 RCOP EBIT 380 Import terminal Good cost control Loss of specialties and One-off supply costs, 360…
  19. August 2015 Investor Presentation – Caltex Australia – slide 19
    Ampol Singapore Building capabilities (crude & product sourcing, trading, shipping) Established in late 2013, with ramp up of capabilities and activities during 2014 prior to closure of Kurnell refinery Activity in Ampol has…
  20. August 2015 Investor Presentation – Caltex Australia – slide 20
    Supply & Marketing Highlights Diesel, Jet Fuel Sales - Volumes down, despite strong Vortex retail sales growth Total diesel volumes fell 5.2% to 3.5BL, off a record BL Caltex Diesel, Jet Sales 2014 base Mixed results across Vortex /…
  21. August 2015 Investor Presentation – Caltex Australia – slide 21
    Supply & Marketing Highlights Petrol Sales - Premium petrols volumes up; Total Market and volumes down BL Caltex Petrol Sales Premium petrol sales up 5.4%, including Vortex 98 volumes up 13%. 3.00 0.55 0.50 Premium now represents…
  22. August 2015 Investor Presentation – Caltex Australia – slide 22
    Supply & Marketing Highlights Non Fuel Income (NFI) Network development enables transport fuels and convenience growth Non fuel income (net) down 3m to 81m m Caltex Non Fuel Income 200 Non fuel income is an enabler for Transport…
  23. August 2015 Investor Presentation – Caltex Australia – slide 23
    Supply & Marketing Highlights Retail capabilities and other developments Convenience store sales grow to 1.2 billion per annum (approx. 3 million customers each week) Trial of new convenience store format and offer Continue to develop…
  24. August 2015 Investor Presentation – Caltex Australia – slide 24
    Supply & Marketing Highlights Capabilities and Other Developments Retail Card and Loyalty Around 1 million StarCard holders, representing around 20% of retail fuel volumes Major promotional card campaigns under way - StarCard debit…
  25. August 2015 Investor Presentation – Caltex Australia – slide 25
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Outlook & Summary Q&A Appendices 25
  26. August 2015 Investor Presentation – Caltex Australia – slide 26
    Lytton Refinery Highlights Strong operational performance enables Lytton to take advantage of strong refiner margins, despite lower production due to major T&I Margin capture enabled by: Good cost control (Tabula Rasa focus) - High…
  27. August 2015 Investor Presentation – Caltex Australia – slide 27
    Lytton Refinery Highlights Stronger Caltex Refiner Margin (CRM) driven by higher Singapore WAM, lower crude premium and efficient yield recovery 30 14 12.82 28 26 Caltex Refiner Margin 12 24 Build-up (US/bbl) 22 1H15 1H14 20 10 18…
  28. August 2015 Investor Presentation – Caltex Australia – slide 28
    Lytton Refinery Highlights Caltex Refiner Margin (CRM) driven by stronger Singapore WAM and lower yield loss 2007-2015 Caltex Refiner Margin*1 (US/bbl) 25 Higher CRM driven by stronger market prices (Singapore WAM) and lower yield…
  29. August 2015 Investor Presentation – Caltex Australia – slide 29
    Lytton Refinery Highlights Operational performance metrics adversely impacted due to Turnaround & Inspection (T&I) Refinery Production, Utilisation (%) and Availability (%) BL % T&I impacted Lytton 3.50 100 operational performance: 97…
  30. August 2015 Investor Presentation – Caltex Australia – slide 30
    Lytton Refinery Highlights Production Mix Lyttons product slate (% of total volumes) drives Singapore WAM and CRM LYTTON 1H 2015 2014 2013 2012 2011 2010 Diesel 38% 38% 39% 40% 38% 39% Premium Petrols 11% 13% 12% 13% 12% 10% Jet…
  31. August 2015 Investor Presentation – Caltex Australia – slide 31
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Result Summary & Summary Q&A Appendices 31
  32. August 2015 Investor Presentation – Caltex Australia – slide 32
    Financial Discipline - Capital Expenditure Capital directed to reinvest and grow, whilst ensuring a safe, efficient business m Caltex Capex Spend 600 1H 2015 total capex spend of 170m, includes 29 million of 568 Kurnell conversion…
  33. August 2015 Investor Presentation – Caltex Australia – slide 33
    Financial Discipline Average daily borrowings lower on higher earnings, disciplined capex spend and lower working capital levels % m Period end debt and gearing* m Caltex net debt levels** 800 40 2500 700 740 742 35 715 2000 600…
  34. August 2015 Investor Presentation – Caltex Australia – slide 34
    Financial Discipline - Returns Focused Capital Mgmt. Capital management objective Given the companys improved cash flows and strong balance sheet, Caltex has reviewed the options for capital management based on established priorities…
  35. August 2015 Investor Presentation – Caltex Australia – slide 35
    Financial Discipline - Dividend Interim dividend of 47 cents per share (2014: 20cps) Caltex dividend history Cents per share Payout Ratio 80 60% 70 70 60 50% 60 40% 50 45 30 40 50 40 34 30% 23 30 25 28 17 20% 47 20 30…
  36. August 2015 Investor Presentation – Caltex Australia – slide 36
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Result Summary & Outlook Q&A Appendices 36
  37. August 2015 Investor Presentation – Caltex Australia – slide 37
    RESULT SUMMARY & OUTLOOK RESULT TAKE-AWAYS RCOP NPAT 251 million, 45% above prior year Significant item of 29 million (after tax) from sale of surplus property Dividend 47.0 cps declared (2014: 20cps) fully franked (51% payout)…
  38. August 2015 Investor Presentation – Caltex Australia – slide 38
    Q&A 38
  39. August 2015 Investor Presentation – Caltex Australia – slide 39
    AGENDA Safety 2015 Interim Results : Key Highlights Strategy Update Financial Highlights Supply & Marketing Highlights Lytton Refinery Highlights Financial Discipline Result Summary & Outlook Appendices 39
  40. August 2015 Investor Presentation – Caltex Australia – slide 40
    Appendix Caltexs Strategy CALTEXS 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…
  41. August 2015 Investor Presentation – Caltex Australia – slide 41
    Appendix - Australian Fuels Demand Growth Demand growth forecast for jet fuel, diesel, but slower versus previous decade growth Australian Transport Fuels Market Volume and Growth Slowing growth in diesel forecasts, compared to the…
  42. August 2015 Investor Presentation – Caltex Australia – slide 42
    Appendix - Regional Supply Capacity Regional refining utilisation expected to increase gradually out to 2018 Asia Pacific Refining Capacity Additions and Utilisation Net Additions Crude Unit Utilisation kbd % New 2015 regional…
  43. August 2015 Investor Presentation – Caltex Australia – slide 43
    Appendix - Regional Supply and Demand Regional product demand growth projected to exceed refining capacity additions (3 years) Asia Pacific Product Demand Growth vs CDU Capacity kb/d Additions Product demand growth in the 2,000 Asian…
  44. August 2015 Investor Presentation – Caltex Australia – slide 44
    Appendix - Middle East product balances Middle East region forecast to have growing surpluses of transport fuels Kb/d Middle East Product Net Exports 800 New refinery capacity is being built in 700 the Middle East, leading to a…
  45. August 2015 Investor Presentation – Caltex Australia – slide 45
    Appendix AUD-USD Exchange Rate 1.10 AUD vs USD 1.05 1.00 0.95 0.90 0.85 0.80 0.75 0.70 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2014 2013 Source = HSRA Reuters 45
  46. August 2015 Investor Presentation – Caltex Australia – slide 46
    Appendix Commodity Exposure - Oil Prices USD/bbl Dated Brent Prices 120 110 100 90 80 70 60 50 40 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2014 2013 Source = Reuters 46
  47. August 2015 Investor Presentation – Caltex Australia – slide 47
    Appendix Product Prices - Regional Traded Petrol USD/bbl Unleaded (Platts 92Ron) 140 130 120 110 100 90 80 70 60 50 40 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2014 2013 Source = Reuters 47
  48. August 2015 Investor Presentation – Caltex Australia – slide 48
    Appendix Product Prices - Regional Diesel USD/bbl Diesel (Platts 10 ppm) 140 130 120 110 100 90 80 70 60 50 40 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2014 2013 Source = Reuters 48
  49. August 2015 Investor Presentation – Caltex Australia – slide 49
    Appendix - Reporting Framework Change Reconciling 2014 to 2015 segment reporting 2014 Segmentation Basis 1H 2014 2015 Segmentation Basis 1H 2014 Marketing 393 Lytton 40 Supply Chain* (65) Supply and Marketing* 288 Corporate (38)…
  50. August 2015 Investor Presentation – Caltex Australia – slide 50
    Appendix Integrated Supply & Marketing performance broadly flat, despite competitive business to business sector 1H 2015 EBIT Comment / Source Reported EBIT 264 ASX Results Release Adjustments: Add-back Externalities 31 FX 17m;…
  51. August 2015 Investor Presentation – Caltex Australia – slide 51
    Appendix Financial Discipline - Indicative Capital Expenditure* (includes T&I**) millions 2013 2014 1H 2015 2015 Forecast* Lytton - Stay in business (includes T&I) 93 58 62 80-90 - Growth 13 56 18 40-50 106 114 80 120-140 Marketing…
  52. August 2015 Investor Presentation – Caltex Australia – slide 52
    Appendix Financial Discipline - Depreciation & Amortisation* millions 2013 2014 1H 2015 2015 Forecast* Lytton 24 34 18 40-45 Marketing and Supply 91 99 68 140-145 Corporate ** 8 33 4 5-10 123 166 89 185-200 Kurnell Refinery 42 37…
  53. August 2015 Investor Presentation – Caltex Australia – slide 53
    Appendix Company-wide efficiency and organisation structure review Tabula Rasa - Benefits Tabula Rasa 2016 Expected Recurring Savings M Comments Head count reduction (net 250-300 FTEs, previously approx. 350FTEs) 40 - 45 Previously 40m…
  54. August 2015 Investor Presentation – Caltex Australia – slide 54
    Appendix Financial Discipline: Available Finance Facilities supports growth and competitive dividend Current sources of funding Debt maturity profile Am Source US notes 0 US institutional 150 Australian and Asian A notes 150…
  55. August 2015 Investor Presentation – Caltex Australia – slide 55
    Appendix Financial Discipline: Kurnell Closure Cash-flow Indicative Item Description Timing amount Closure costs Includes redundancy, (430)m* Majority of redundancies took place 4Q 2014, decommissioning and 29 million remaining at 30…
  56. August 2015 Investor Presentation – Caltex Australia – slide 56
    Appendix Summary Financial Information 1H 2015 2014 2013 2012 2011 Dividends Dividends (/share) 0.47 0.20 0.34 0.40 0.45 Dividend payout ratio - RCOP basis (excl. significant items) 51% 38% 28% 24% 46% Dividend franking percentage…

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