Ampol profit surges nearly five-fold as Iran war boosts refining margins

By Sherin Sunny and Keshav ‌SinghChundawat

Aug 24 (Reuters) - Australia's ​top ​fuel retailer Ampol posted record interim profit on Monday as higher refining margins linked to Middle East supply disruptions lifted earnings nearly ‌five-fold, pushing its shares to a more than two-year high.

Refining margins ⁠at Ampol's Lytton refinery in Queensland, one of Australia's only two refineries, more than tripled to $28.26 ‌a barrel in the first ‌half ended June 30.

That helped earnings in the fuel and infrastructure (F&I) segment surge more than nine-fold, while convenience retail earnings rose 12%.

Underlying net profit after ​tax soared to A$857.2 million ($614.44 million) on a replacement cost basis, compared with A$180.2 million a year earlier, comfortably beating the Visible Alpha consensus estimate ⁠of A$840 million.

The first-half profit was nearly double the previous record first-half result in 2022 and about 17.1% ​above the record full-year profit in the same year.

Ampol declared an interim dividend of 185 Australian cents per share, up from ​40 cents a year earlier.

Shares of the company ‌rose as much as 4.3% to A$41.59, their highest since early April 2024, while the broader S&P/ASX 200 index was up ⁠0.6% by 0159 GMT.

"The key point to watch is how durable this earnings boost will be once refining margins normalise and the geopolitical tailwind fades," said Hebe Chen, a ⁠market analyst at Vantage Markets.

"For now, though, Ampol is entering the second half with a much ​stronger earnings and cash-flow profile, alongside a meaningful improvement in investor confidence."

Ampol expects the acquisition of EG Australia, the local arm of British fuel station operator EG Group, to add ‌to its second-half earnings, with annual synergies of A$65 million to A$80 million seen within two years of completion, and ‌benefits starting to flow through in 2027.

The company forecast net capital expenditure of A$600 ⁠million in fiscal 2026 and said ‌it expected spending to ​fall in 2027.

($1 = 1.3951 Australian dollars)

(Reporting by Sherin Sunny and Keshav Singh Chundawat in Bengaluru; Editing by Mark Porter, Sonali Paul and ‌Subhranshu Sahu)

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