Caltex Australia, Oil Search, Scentre Group and FlexiGroup - First Impressions from reporting

Bell Potter


Caltex Australia (CTX):  Lytton EBIT of A$205m as compared to $406m pcp-slightly ahead of pre-guidance and our estimate of A$200m) Full year sales from production increased 14% to 6.2 BL | S&M EBIT up 5.6% to A$709m ahead of guidance (A$700m)- Excluding unfavourable externalities of $29 million, Supply and Marketing underlying EBIT up 9% to $738m. | Outlook: CTX has reaffirmed its commitment to top quartile TSR (15% pa), and has also stated it will continue to buy profitable growth to deliver this and offset lost WOW profitability.


Oil Search (OSH):  Statutory NPAT of US$89.8 million included a profit, net of costs, of US$18.7 m from the break fee received from ExxonMobil relating to the InterOil txn, offset by a one-off, non-cash restatement of deferred tax balance of US$35.6m | PNGLNG production: average rate of 7.9 MTPA during the year, compared to nameplate capacity of 6.9 mtpa | Average realised oil and condensate price down 12% to US$45.04 per barrel | Average price realised for LNG and gas sales decreased 33% to US$6.36 per mmBtu | Production up 3% to 30.24mmboe | Sales up 6% to 30.59mmboe | Unit production costs fell from US$10.08 per barrel of oil equivalent (boe) in pcp to US$8.50 per boe | Net operating cash flow down 42% to US$555.1m | Outlook: 2017 Capital Cost Guidance (US$315 – 400 million). Total Production 28.5 – 30.5 mmboe. Production costs US$8.50 – 10.50 / boe. Other operating costs4 US$135 – 145 million. Depreciation and amortisation US$12-13/ boe.


Scentre Group (SCG):  Comparable specialty sales growth 2.6% | Net property income was $1809.7m as compared to $1824m in pcp. Comparable property net operating income increased 2.9%and is forecast to increase between 2.75% - 3.0% for 2017.| Outlook: The Group forecasts FFO growth for the 12 months ending 31 December 2017 of approximately 4.25%. Excluding the impact of transactions the forecast underlying FFO growth is approximately 5%. The distribution for 2017 is forecast to be 21.73 cents per security an increase of 2%.


FlexiGroup (FXL):  Group volume from continuing operations for 1H17 grew 70% to $975 million while closing receivables were up 64% to $1,998m | Divisional Highlights: Australia Cards Cash NPAT decline 19%, 48% volume growth and 44% growth in receivables; NZ cards NPAT increased by 4.2%; Certegy cash NPAT up 1%, volume down 1%, and receivables down 1%  NZ Leasing NPAT up 25%; Australia Leasing  Cash NPAT down 28%, volume up 21%, closing receivables down 1%; NZ Leasing Cash NPAT up 8%, volumes steady, closing receivable up 10%. | Net operating cash flow $100.8m as compared to $64.6m in pcp | Outlook: FY17 Cash NPAT estimate of $90 million to $97 million reaffirmed. Dividend payout to adjusted to 30-40% of Cash NPAT (from 50-60%).



Bell Potter Securities is a leading Australian stockbroking, investment and financial advisory firm that provides a comprehensive offering of financial services to a diversified client base that includes individuals, institutions and corporations.

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