Caltex Australia’s shares have slumped after the service station owner said it expected first-half underlying net profit to be less than half of what it was a year ago amid a slowdown in the country’s economy.
Caltex said its replacement cost operating profit (RCOP) in the six months to June 30 was likely to be between $120 million and $140 million, in contrast to a RCOP net profit after tax of $296 million in the previous corresponding period.
“The industry continues to experience difficult macro-economic conditions, arising from the slowing Australian economy, low refining margins and high crude prices combined with a low FX rate,” Caltex chief executive Julian Segal said on Thursday.
“Weaker domestic economic activity has impacted domestic demand, including from the transport, agriculture and construction sectors,” the company said in a profit guidance update to the ASX.
“Combined with a lower external refiner margin and the high price of crude, this has created difficult market conditions for both sales volumes and margins.”
It estimated that fuel sales volumes across the industry were about two per cent lower compared to the first half of 2018.
Caltex shares were down 18.46 per cent to $22.00 at 1100 AEST on Thursday.