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Strong operations lead to higher Caltex profit

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Caltex Australia yesterday announced that it expects a higher profit after tax on a replacement cost of sales operating profit (RCOP) basis in the range of $390 to $420 million for the year to 31 December 2005 as a result of tight supply/strong demand for petroleum products and a strong operating performance in the second half.

This outlook compares with an RCOP result of $348 million for the full year 2004.

The outlook is based on unaudited results for the year to 31 October 2005 and includes near term forecasts for external factors such as refining and marketing margins, freight costs and foreign exchange rates.

Continued strong demand for fuels in the Asia Pacific region coupled with US production shortages caused by Hurricane Katrina have resulted in significantly higher refiner margins in the second half of the year.

The Caltex Refiner Margin averaged more than $US11 a barrel in the period from 30 June 2005 to 31 October 2005 compared with $US7.28 a barrel in the first half of 2005. (Full year 2004: $US7.04.)

"We are satisfied with this strong expected result for shareholders," Caltex Managing Director Dave Reeves said.

"There is real momentum in the business and we feel confident about the outlook. Our strategies are working and we continue to build further competitive edge in key areas and the external environment, while remaining volatile, looks favourable."

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