Viva Energy Group Limited

Thank you for standing by and welcome to the Viva Energy Australia half year 2025 results. All participants are in a listen only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to have the conference over to Mr. Scott Wyatt, Chief Executive Officer. Please go ahead.

Good morning and thank you for joining us this morning to discuss our first half results. With me on the call is Carolyn Pettish, our Chief Financial Officer and Jovan Buzo, our CEO of Convenience and Mobility. Carolyn and I will share the group results and Jovan will provide more commentary on the development of our retail strategy, which is a clear priority for the business and an important driver of long-term growth. Over the last year we have made substantial progress to bring together our retail businesses under a single unified operating platform and with the bulk of the transition now behind us we're very focused on delivering on these aspirations in the period ahead. We look forward to sharing this progress with you this morning as well as the performance of our broader business. So let me begin by turning to slide four and five to briefly discuss our broader operational and trading performance. Our safety and operational performance in the first half was very solid. Injury frequency rates continue to improve and I'm particularly pleased with the step change we are seeing across the retail business as common expectations and processes are implemented. Our process safety performance is equally strong and we are well prepared for a busy operational period as we commence our major maintenance at Geelong and the start-up of our ultra-low sulfur gasoline production. After suffering a slight light car edge in January, Geelong Refinery recovered extremely well. and has since delivered a strong operating performance with availability at 92% and crude intake at just short of 19 million barrels. Fuel sales were comparatively strong across the group with retail sales largely in line with the prior period despite the broader market decline by more than 20%. Convenience sales were of course heavily impacted by the continued loss of tobacco sales to illicit trade and the knock-on to sales in other convenience categories. I think we've done particularly well to minimise the margin impact in this dynamic, but there's no doubt it's been a significant challenge for this part of our business. The company delivered an EBITDA of $305 million in line with our guidance for the half and has declared an interim dividend of 2.8 cents per share. The balance sheet remains strong with peak capex coming to an end and net debt finishing at $1.947 billion. Let me now hand over to Carolyn to discuss our financial performance in more detail.

Thanks, Scott. So, turning to slide 7, this summarises the financial performance bias segment. As Scott just highlighted, Group EBITDA on a replacement cost basis was $305 million, which was slightly above the guidance we gave in late July. Net profit after tax for the Group was $63 million. That's reflecting another strong period of delivery from commercial and industrial along with a period of challenging conditions for the retail and refining businesses, as well as higher depreciation and amortisation and net interest costs associated with recent acquisitions. Significant items recognised outside underlying earnings during the period included a non-trash $245 million in pens at individual sites in the convenience and mobility business, It's primarily the reduction of the right of use assets for certain sites during a period of softer trading conditions and decline in tobacco. The board has determined a fully frank dividend of 2.8 cents per share. That represents a payout ratio of 50% for the convenience and mobility and commercial and industrial businesses for the half. Now, turning to cash flow on slide 8. Free cash flow for the half was impacted by a period of significant investment and integration activity. You can see the bridge from EBITDA to net free cash flow, the impact of capital expenditure on multiple year projects, the acquisition of liberty convenience, as well as integration costs associated with convenience and mobility. When you adjust for these items, underlying free cash flow is slightly positive. Now, given we report on a pre-AASB16 basis, EBITDA remains a good proxy for underlying operation cash generation. Now, on the next slide, net capital expenditure for the half was $225 million. We remain on track for around $500 million of investment in FY2025, net of government grants. Spend is weighted to the ultra-low sulfur gasoline and aromatics projects, which are expected to be completed in October this year, at a total net cost of approximately $217 million From FY26 onwards, as we've previously guided, we expect capital expenditure to step down to between $350 and $450 million per annum as these major projects are delivered and integration spend moderates. Now, moving to slide 10, on gearing at the half was elevated at 1.66 times, which is just above our target range of 1 to 1.5 times term debt to trailing 12-month EBITDA. Deering, including total net debt, was 3.2 times. This reflects a period of significant investment, which, as I mentioned earlier, will reduce heading into 2026. Our focus is on reducing deering as we move through the current period of intensive capital investment towards two times by the end of FY2027, including utilisation of the revolving credit facility. This will be supported by the completion of major projects, delivery of earnings and improved market conditions. Now, on slide 7, you'll see the board has determined an interim fully franked dividend of 2.8 cents per share for the half. And this represents, as I said, a 50% payout ratio of NPAT-RC from the convenience and mobility and commercial industrial segments and 73% of the group overall. Consistent with our dividend policy, no dividend has been declared for the energy and infrastructure segment, which is assessed on a full year basis. The interim dividend will be paid on the 30th of September 2025 to shareholders on the register at about the 8th of September 2025. Now, our dividend reinvestment plan remains active with 52% participation in the final FY2024 dividend and eligible shareholders can reinvest their dividends directly into shares at a 1.5% discount. The dividend reinvestment plan is not underwritten. With that, I'll hand over to John to discuss the development of our convenience business.