Viva Energy Group: Another Late Earnings Downgrade on Persisting Low Refiner Margins; FVE Intact
We make no change to our AUD 3.00 fair value estimate for no-moat Viva Energy. The company has again downgraded fiscal 2018 earnings guidance due to weaker-than-expected regional refiner margins. But we hold to our longer-term view, including assumed reversion of the refiner margin to a midcycle USD 9.00 per barrel in real terms. Viva says the actual refiner margin for December was just USD 3.30 per barrel, driven lower due to gasoline cracks falling on excess regional supply. Consequently, the ...Viva Energy Group Ltd. Viva Energy Group Ltd is an Australia-based integrated downstream petroleum company. The Company operates across three business segments: Retail, Fuels and Marketing; Refining; and Supply, Corporate and Overheads. Retail, Fuels and Marketing segment consists of retail and commercial operations. Retail, which supplies and markets fuel products and lubricants through a national network sites. Commercial, which supplies of fuel, lubricants and specialty products to commercial customers. Refining segment owns and operates the Geelong Refinery, in Victoria, which converts imported and locally sourced crude oil into petroleum products including gasoline, diesel, jet fuel, aviation gasoline, gas, solvents, bitumen and other specialty products. Supply, Corporate and Overheads segment owns contracted access to a national infrastructure network comprising terminals, retail sites, storage tanks, depots and pipelines positioned across metropolitan and regional Australia.
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