ASX RELEASE

27 July 2017

CALTEX REFINER MARGIN UPDATE (JUNE 2017)

Caltex advises its realised lagged1 Caltex Refiner Margin (CRM2), in respect of CRM sales from production for the month of June 2017.

June 2017

May 2017

June 2016

Unlagged CRM

US$12.67/bbl

US$9.94/bbl

US$11.08/bbl

Impact of pricing lag positive/(negative)

US$0.88/bbl

US$0.00/bbl

US$0.52/bbl

Realised CRM

US$13.55/bbl

US$9.94/bbl

US$11.60/bbl

CRM Sales from production

504 ML

529 ML

484 ML

The June unlagged CRM was US$12.67/bbl. This is above the prior month (May 2017: US$9.94/bbl) and prior year monthly comparative (US$11.08/bbl). The May 2017 production mix was adversely impacted by the planned maintenance on the Benzene Hydrogenation Unit (BHU) which interrupted premium gasoline production, resulting in a higher proportion of regular gasoline production.

The June unlagged Caltex Singapore Weighted Average Margin was US$12.36/bbl, which is above the prior month (May 2017: US$12.15/bbl) and prior year (June 2016: US$10.88/bbl).

Lower Brent crude oil prices in the last week of June drove a favourable US$0.88/bbl pricing lag (May resulting in a nil impact US($0.00)/bbl pricing lag).

The June 2017 realised CRM was US$13.55/bbl. This is above the May 2017 CRM of US$9.94/bbl and prior year comparative (June 2016: US$11.60/bbl). The June 2017 realised CRM is above the CRM of US$12.50/bbl assumed in the Unaudited 2017 Half Year Profit Guidance released 22 June 2017 due to both favourable Caltex Singapore Weighted Average Margin and a more favourable pricing lag.

Sales from production in June 2017 of 504 ML were below the prior month (May 2017: 529 ML) but above the prior year comparative (June 2016: 484 ML).

For the six months to 30 June 2017, the average realised CRM was US$12.59/bbl (2016 US$10.10/bbl) with CRM sales from production totalling 3,018 ML (2016: 2,925 ML).

Period ended 30 June

2017

2016

Realised CRM

US$12.59/bbl

US$10.10/bbl

Unlagged CRM

US$12.36/bbl

US$10.25/bbl

CRM Sales from production

3,018 ML

2,925 ML

Notes
  1. A fall in the Australian dollar crude price, particularly at the latter end of the month, produces a positive lag effect on the CRM (i.e. increases the CRM) and, conversely, in the event of a rise in the Australian dollar crude price, a negative lag effect occurs (i.e. reduces the CRM).

  2. CRM represents the difference between the cost of importing a standard Caltex basket of products to eastern Australia and the cost of importing the crude oil required to make that product basket.

    The CRM is calculated in the following manner:

    Weighted Singapore product prices (for a standard Caltex basket of products)

    Less: Reference crude price (the Caltex reference crude marker is Dated Brent) Equals: Singapore Weighted Average Margin (Dated Brent basis)

    Plus: Product quality premium Crude discount

    Product freight Less: Crude premium

    Crude freight Yield Loss

    Equals: Caltex Refiner Margin

    The Caltex Refiner Margin is converted to an Australian dollar basis using the prevailing average monthly exchange rate.

    CRM is just one contributor to the replacement cost of sales operating profit (RCOP) EBIT earnings (excluding significant items). Other items contributing to the RCOP EBIT include Transport Fuels volume and margin, Lubricants and Specialties volume and margin, Non-Fuel Income and Other Margin less Operating Expenses.

  3. RCOP excludes the unintended impact of the fall or rise in oil and product prices (a key external factor) and presents a clearer picture of the company's underlying business performance. It is calculated by restating the cost of sales using the replacement cost of goods sold rather than the historic cost, including the effect of contract based revenue lags.

Caltex Australia

A proud and iconic Australian company, Caltex has grown to become the nation's leading transport fuel supplier, with a vast network of approximately 1,900 company-owned, franchised or affiliated sites. Caltex aims to be the market leader in complex supply chains and the evolving convenience marketplace, by delivering the fuel and other everyday needs of its diverse customers through its networks. With a history tracing back to 1900, Caltex has safely and reliably fuelled the needs of Australian motorists and businesses for more than a century. It operates as a refiner, importer and marketer of fuels and lubricants. It is listed as CTX on the Australian Securities Exchange.

For more information visit www.caltex.com.au

INVESTOR CONTACT MEDIA CONTACT

Rohan Gallagher Elizabeth Rex

Head of Investor Relations GM Corporate Affairs

+61 2 9250 5247 +61 2 9250 5809

+61 421 051 416 +61 429 171 350

rohan.gallagher@caltex.com.au erex@caltex.com.au

Caltex Australia Limited published this content on 26 July 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 26 July 2017 23:09:01 UTC.

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