Z Energy has posted $38 million in earnings for its first quarter result for the year.
This includes an $11m loss in April during alert level 4 and level 3 compared to the same period last year.
Overall, it was down 60% for the three months to June 30 compared to $95m for the same period last year in earnings before interest, tax, depreciation, amortisation and changes in financial instruments.
Z’s total fuel volume for the quarter was 595 million litres (ml), down 39% year-on-year, highlighting the substantial effect of COVID-19.
Petrol was down 40.8% for the quarter with 170ml, diesel down 19.5% with 243ml and other fuels (including jet) down 53% with 182ml.
The company’s net profit after tax for the quarter was down 144% and $15m in the red compared to a net profit of $34m in the same period last year.
Assuming New Zealand remains at alert level 1 and refining margins remain at historic lows with reduced Refining NZ production, Z forecasts earnings for 1HFY21 to be in the range of $85m – $100m (RC EBITDAF)
Z chief executive Mike Bennetts says the current strategy “is increasing retail volume in a competitive market while reducing operating expenses”.
“Z is reducing exposure to volatile refining margins, putting our terminal assets onto a more commercial footing and monetising investments made over the past three years in customer experience and digital platforms.
“Z has responded to the significant drop in volume due to the COVID-related lockdown and is executing well as the domestic economy gets back to normal.
“Assuming no reversion to more restrictive lockdown levels, the better than expected start to the year provides confidence around Z’s performance for the rest of the financial year,” Bennetts says.
