The Ampol Ltd (ASX: ALD) share price is taking a tumble today.
Shares in the S&P/ASX 200 Index (ASX: XJO) energy stock closed Friday trading for $28.03. In early morning trade on Monday, shares are changing hands for $27.16 apiece, down 3.1%.
For some context, the ASX 200 is down 0.9% at this same time.
This underperformance follows the release of Ampol's full calendar year 2024 results.
Here's what's happening.
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Ampol share price slides alongside earnings
The Ampol share price is taking a hit after the Aussie fuel supplier reported a 45% year on year decline in replacement cost operating profit earnings before interest and tax (RCOP EBIT) of $715 million.
RCOP earnings before interest, taxes, depreciation and amortisation (EBITDA) of $1.2 billion was down 32% from 2023.
While ASX 200 investors had previous insight to these figures from Ampol's fourth-quarter update in January, the 68% plunge in RCOP net profit after tax (NPAT) to $235 million in 2024 is likely adding to the headwinds facing the Ampol share price today.
At $123 million, statutory NPAT was down an even steeper 78% from 2023.
Ampol's Lytton refinery reported a $42 million full-year EBIT loss (down from a $363 million positive EBIT in 2023), hit by "challenging global refining" conditions and operational disruptions over the year.
Still, Ampol cited growth in earnings from its Convenience Retail business and "resilient performances" from New Zealand and Fuels & Infrastructure Australia amid challenging economic environments as underpinning the results.
As for passive income, the board declared a final dividend of 5 cents per share, fully franked. That's a massive retrace from last year's final dividend payout of $1.80 per share.
Ampol's balance sheet also went backwards, with net borrowings of $2.77 billion at 31 December 2024, up from $2.20 billion at 31 December 2023.
What did management say?
Commenting on the full-year results that are pressuring the Ampol share price today, CEO Matt Halliday said, "The 2024 financial year was one of challenging global refining and commodity markets that impacted both our Lytton refinery and Trading and Shipping operations".
Halliday added:
Our retail businesses were the highlight with Convenience Retail growing earnings again this year, while Z Energy delivered another resilient performance, both against the backdrop of economic environments where higher interest rates and inflation increased cost of living pressures on consumers.
The performances of our retail business in both key markets, and of our Australian commercial fuels business, underscores the increased resilience of our business today. Not only has it enabled relatively strong core earnings to be delivered during the period, it has also meant we could take the decisions necessary in the refinery during the softer margin environment to set us up for a clear run in 2025.
Now what?
Looking at what could impact the Ampol share price in the months ahead, the company noted the Lytton Refiner Margin for January was US$6.31 per barrel. That's above the LRM reported in December but remains below historical averages. Management said this is primarily due to lagging crude premiums and short-term compression of the freight differential.
With New Zealand's central bank actively cutting interest rates, management said "green shoots of improved trading conditions" are evident in its businesses in the country as the benefits of the rate-cutting cycle take effect.
Management added:
Overall markets have seen an uplift in uncertainty due to global political dynamics and trade policy speculation. While it is too early to be conclusive on the implications, the integrated nature of Ampol's value chain means we are well placed to navigate changing conditions through our Trading and Shipping operations which should benefit F&I International.
With today's intraday fall factored in, the Ampol share price is down 30% over 12 months.
