Ampol Reports $1.35 Billion EBIT Boost on Strong Refinery Margins

Surging Earnings Reflect Supply Chain Resilience

Ampol Limited (ASX:ALD) has reported a striking leap in its first half 2026 financial performance, with unaudited Replacement Cost Operating Profit (RCOP) EBITDA hitting approximately $1.6 billion, more than doubling the prior year’s $649 million. RCOP EBIT climbed to about $1.35 billion, a 234% increase from the $404 million recorded in 1H 2025. This surge comes amid unprecedented disruption in global energy markets caused by the ongoing Middle East conflict.

Managing Director Matt Halliday highlighted the critical role of Ampol’s integrated supply chain and the Lytton refinery’s reliable output in navigating the turmoil. “Our refinery performed very reliably, operating at maximum production and benefiting from rising prices for equivalent imported products,” Halliday said, underscoring years of investment in safety and resilience.

Refinery Margins Soar on Regional Supply Constraints

The Lytton Refiner Margin (LRM) averaged US$28.26 per barrel in the half, a staggering 280% increase over the prior year’s US$7.44. The second quarter alone saw LRM spike to US$30.93 per barrel, driven by elevated product cracks for diesel, jet, and premium gasoline. These were the result of ongoing crude supply constraints caused by the closure of the Strait of Hormuz and heightened geopolitical risks affecting the Bab-el-Mandeb Strait.

Regional refinery runs were curtailed to match limited crude availability, creating a shortage of refined products and pushing prices sharply higher. Ampol’s Lytton refinery, linked to import parity pricing, capitalised on these conditions, while refinery production rose 8.7% to 2,945 megalitres in 1H 2026.

Australian Fuel Sales Rise on Supply Reliability and Retail Strategy

Australian fuel sales, excluding net-sell volumes, grew 2.8% year-on-year, reflecting Ampol’s ability to maintain supply during market disruptions. This was supported by growth in both wholesale (up 2.9%) and Convenience Retail volumes (up 2.4%), the latter boosted by Ampol’s U-GO unstaffed discount sites expanding from 34 to 47 locations.

In contrast, New Zealand volumes declined 2.5%, with the market slower to pass through rising input costs, a situation Ampol expects to resolve in the second half.

Strategic Acquisition and Capital Management

On 30 June 2026, Ampol completed its acquisition of EG Australia for $1.165 billion in cash, electing to convert the scrip component to a full cash settlement. This move ensures shareholders fully participate in anticipated synergies estimated between $65 million and $80 million annually within two years. The acquisition adds significant scale to Ampol’s retail network, complementing its Convenience Retail growth strategy.

The cash outlay for EG Australia is included in period-end net borrowings, reflecting Ampol’s capital commitment to expanding its footprint and operational capabilities.

Managing Upcoming Refinery Maintenance and Ongoing Geopolitical Risks

Ampol’s Lytton refinery will undergo a major maintenance program from August through October 2026, expected to reduce production by approximately 300 megalitres. The company plans to mitigate this impact through diversified supply sources, import infrastructure, and its trading capabilities, ensuring product availability remains uninterrupted.

Geopolitical tensions in the Middle East have escalated recently, further tightening crude and product flows through critical maritime chokepoints. Ampol reports having secured physical supply arrangements for the majority of the third quarter, positioning it to manage continued volatility. The company’s independent trading and shipping team provides it with flexibility and market intelligence to optimise supply under these conditions.