Viva Energy Posts Modest Sales Growth Amid Refinery Outage and Acquisition Moves

Solid Sales Growth Despite Operational Challenges

Viva Energy Group Limited reported a modest 0.8% increase in total group sales volumes for the fourth quarter of 2024, reaching 4.4 billion litres. This growth was largely driven by a record quarterly performance in the Commercial & Industrial (C&I) segment, which achieved 3 billion litres in sales, buoyed by strong demand in aviation, transport, and agriculture sectors. Convenience & Mobility (C&M) fuel sales also rose 2.0%, supported by network expansions including OTR and Liberty Convenience outlets, alongside seasonal consumer demand.

However, the retail convenience and quick-service restaurant sales remained broadly flat, with illicit tobacco sales continuing to weigh on margins. Despite these headwinds, the convenience gross margin improved to 40.4%, helping to offset some of the margin pressures.

Refinery Outage and Its Financial Impact

The Geelong Refinery faced a significant operational setback with an unplanned power outage on 12 January 2025, triggered by an external power supply interruption during a lightning storm. This event caused a shutdown across all process units, temporarily halting production. Viva Energy successfully resumed normal operations within a week, but the outage is expected to reduce EBITDA by approximately A$20 million.

For the full year 2024, the Geelong Refining Margin stood at US$6.7 per barrel on a crude intake of 9.3 million barrels, down from the previous year. Production was also affected by late crude arrivals and maintenance activities. Notably, the refinery has recently installed capability to process waste and bio-genic feedstocks for recycled plastics production, marking a strategic step towards sustainability.

Financial Performance and Acquisition Progress

Viva Energy’s unaudited underlying EBITDA on a replacement cost basis is estimated at approximately $750 million for FY2024. The strong growth in the C&I business helped offset challenges in retail fuel margins and refining conditions. The C&M segment’s EBITDA is expected to be near the bottom of its guidance range ($230 million to $260 million), reflecting ongoing retail margin pressures and illicit tobacco impacts.

On the corporate development front, Viva Energy secured Australian Competition and Consumer Commission (ACCC) approval for its acquisition of Liberty Convenience in December 2024, subject to a court-enforceable divestiture undertaking. Foreign Investment Review Board (FIRB) approval followed in January 2025. The acquisition, to be funded through existing debt facilities, is anticipated to complete by 31 March 2025, with the final consideration to be disclosed once 2024 financials are finalized.

Looking Ahead

Viva Energy’s recent operational and strategic developments position it for continued growth, but the refinery outage and retail margin pressures underscore ongoing risks. The integration of Liberty Convenience will be a key focus area, as will monitoring the Geelong Refinery’s performance amid evolving market conditions and sustainability initiatives.