Ampol (ASX:ALD) reported a stronger full-year result for 2025, with management pointing to broad-based earnings growth across its convenience retail operations, improving performance at the Lytton refinery, and continued momentum in Australia and New Zealand fuel and convenience demand.
Safety and operational update
CEO Matt Halliday said personal safety performance in Convenience Retail and Z Energy continued to trend close to historical best levels, though the company experienced a small increase in incidents within Fuels & Infrastructure (F&I) that prompted a “safety reset.” In New Zealand, Halliday said there were electrical safety incidents that did not result in injury; Z Energy conducted a stand-down for safety and Ampol initiated a Contractor Safety Uplift program.
Full-year financial results and dividends
On an ARCOP basis and excluding significant items, Ampol reported EBITDA of AUD 1.4 billion, EBIT of AUD 947 million, and NPAT of AUD 429 million. Management said EBIT rose more than 30% year-on-year and NPAT increased more than 80% versus the prior year.
CFO Greg Barnes said statutory NPAT was AUD 82 million, including AUD 136 million of inventory losses after tax during a period when refined product prices trended lower. He also said significant items totaled AUD 210 million after tax.
The board declared a final dividend of AUD 0.60 per share fully franked, bringing total dividends for 2025 to AUD 1.00 per share fully franked, which management said was an increase versus the AUD 0.65 paid last year.
Segment performance: Convenience Retail, New Zealand, and F&I
Convenience Retail delivered EBIT of AUD 374 million, up 4.8% year-on-year. Halliday said the division has delivered average annual EBIT growth in excess of 5% over the past five years. Barnes added Convenience Retail has delivered a 5.4% annual EBIT growth rate since 2020.
Management highlighted mix and in-store execution as key contributors. Premium fuels represented 56.5% of retail fuel volumes, and shop gross margin increased to 40% (post-waste and shrink). Barnes said shop sales excluding tobacco rose 2.8%, driven by higher-margin categories including beverages, chilled perishables, bakery, and general merchandise. Tobacco sales fell more than 20% amid new public health rules and packaging changes, which Barnes said accelerated a shift into the illicit market. He said tobacco now represents 16% of total store sales and 3% of total fuel and shop margin contribution.
The New Zealand business delivered EBIT of AUD 234 million, described as broadly in line with the prior year despite a weaker third quarter. Barnes said earnings recovered strongly in the fourth quarter to levels consistent with the first-half quarterly run rate. He said fuel volumes in New Zealand were flat for the year and that the company’s segmentation strategy was proving effective.
In F&I, EBIT more than doubled to AUD 406 million. Halliday said the Lytton refinery returned to profitability with EBIT of AUD 163 million, following reliability improvements implemented in late 2024 and a stronger margin environment in the second half. Barnes added that improved reliability enabled the refinery to capture stronger margins and benefit from increased production, alongside operating cost savings net of inflation.
Ampol’s infrastructure-backed commercial business in Australia grew EBIT by more than 8%, which management attributed to portfolio repositioning and a sharper focus on returns. Barnes noted that the trading and shipping teams in Singapore and Houston supported the broader system by securing crude, sustaining supply through Cyclone Alfred, and managing risk. However, he said third-party earnings in F&I International declined, with the segment down AUD 15 million in EBIT as the company prioritized supply to Australia and New Zealand amid geopolitical volatility.
Significant items: Energy Solutions simplification and Seaoil impairment
Barnes said significant items included impacts from the simplification of Energy Solutions, involving a one-off restructuring cost and the winding of unrealized gains on electricity derivatives that had previously been recorded in significant items. In connection with this shift, he said Ampol received AUD 70 million of cash proceeds from divestments of the Australian and New Zealand electricity businesses.
The company also recognized a non-cash impairment of AUD 90 million on its investment in Seaoil. Barnes said the Philippines remains a growing market for fuel, but storage capacity and competition have increased in recent years, particularly since the invasion of Ukraine. He said Ampol’s outlook for Seaoil was aligned with current performance, but the company tempered its view on growth beyond current performance for the foreseeable future, leading to the impairment. Barnes added that the impairment did not reflect the value of Ampol’s supply into Seaoil and the broader region, which sits in other divisions.
EG Australia acquisition, U-GO rollout, leverage, and 2026 priorities
Ampol ended the year with leverage back within its target range at 2.3x adjusted net debt to EBITDA. Barnes said net borrowings were just over AUD 2.9 billion, including net capex of AUD 563 million during a peak investment year, partially offset by divestments including Channel Infrastructure and the sale of Flick and the Australian energy businesses. He also cited roughly AUD 100 million of working capital impact from the second phase of minimum stock obligation (MSO) requirements.
Halliday said the company’s strategy remains focused on enhancing the core, expanding its fuels and convenience platform, and evolving its offer pragmatically in line with customer needs. On expansion, he said the proposed acquisition of EG Australia remains subject to regulatory approval, with preparations ongoing and leverage positioning the company to progress the transaction and begin integration following approval. Management said completion remains on track for mid-2026 and confirmed the deal is in Phase 2 of the new merger regime.
On U-GO, Halliday said sites in Australia are delivering more than 50% fuel volume uplift, average EBITDA improvements greater than AUD 350,000 per site, and payback periods of around one year, with capex around AUD 280,000 per conversion. In Q&A, Barnes said the AUD 350,000 uplift is annualized once sites are through a ramp-up period of about six months. Management said the model’s objective is to compete in the second tier of the market and that U-GO’s uplift skews toward base grade petrol volume.
Halliday said identified synergies for EG are AUD 65 million to AUD 80 million, predominantly cost-related, with additional potential when benchmarking the EG network against Ampol’s comparable site performance. In response to questions, management said their expectations for EG under Ampol’s ownership had not changed and that they remained confident in the value case, while also noting the ACCC process was ongoing.
Looking to 2026, Halliday outlined priorities including delivering the EG transaction, continued segmentation execution, and the next phase at Lytton. The company expects to commence commissioning of the Ultra Low Sulfur Fuels project in Q2 2026. Ampol also said it is focused on productivity, targeting a further AUD 50 million of nominal cost reductions across 2026 and 2027 after achieving a AUD 50 million nominal cost reduction in 2025.
Management said trading conditions at the start of the year were strong in Convenience Retail in Australia and New Zealand and in F&I ex-Lytton, while January Lytton margin conditions were weaker than a strong fourth quarter. Ampol guided to net capex of around AUD 600 million for 2026, reflecting safety and reliability spending, retail growth, the scheduled refinery turnaround, and finalization of the low sulfur upgrade.
About Ampol (ASX:ALD)
Ampol Limited purchases, refines, distributes, and markets petroleum products in Australia, New Zealand, Singapore, and the United States. The company operates through Convenience Retail, Z Energy, and Fuels and Infrastructure segments. The Convenience Retail segment sells fuels through Ampol's network of stores. The Fuels and Infrastructure segment wholesales fuels and lubricant supplies. The Z Energy segment distributes fuel in the New Zealand market. It distributes its products through depots, terminals, pipelines, and service station sites.
