PREVIEW: Jefferies expects robust Q1 margins for Australian fuel refiners

Waypoint REIT

25/04/2023 02:02

** Jefferies says fuel refiners Ampol Ltd  ALD.AX  and Viva
Energy  VEA.AX  are expected to post a solid Q1 on continued
strength in retail and refining margins, as well as volume
growth across divisions
    ** However, anticipates negative commentary on refining due
to weakness in regional cracks for Q2 year-to-date
    ** Expects Ampol's Q1 group EBIT (RCOP) of A$319 mln
($213.76 mln) -  second highest qtrly earnings on record with
strength across Refining & Convenience Retail segments
    ** Broker trims its assumed Lytton refining margin to
account for the more rapid-than-expected normalisation of
regional refining margins
    ** Says Viva to report a stronger margin than ALD due to its
larger weighting to middle distillates which enjoyed more
favourable crack spreads than gasoline during qtr
    ** Jefferies has a PT of A$37/share on ALD and a "buy"
rating; PT of A$3.50/share on VEA and a "buy" rating
    ** YTD, ALD up 9.3% and VEA up 13.6%


($1 = 1.4663 Australian dollars)

 (Reporting by Savyata Mishra in Bengaluru)
 ((Savyata.Mishra@thomsonreuters.com))