The Caltex Australia Ltd (ASX: CTX) share price has fallen more than 1% lower in early trade after this morning's first quarter 2019 trading update headlined by a significant drop in net profit after tax (NPAT).
What were the highlights from the update?
The results included Fuels & Infrastructures (excluding Lytton) earnings before interest and tax (EBIT) of $104 million, down marginally on Q1 2018 numbers of $106 million.
For the quarter ended 31 March 2019, Lytton EBIT came in at $5 million, less than a tenth of the $51 million seen in the prior corresponding period (pcp) which translated to Fuels & Infrastructure (F&I) EBIT of $109 million and Convenience Retail (CR) EBIT of $40 million, down 30.1% and 55.6% on Q1 2018, respectively.
The group's RCOP NPAT came in at $94 million, down 42.7% on the $164 million in Q1 2018 while HCOP NPAT fell from $172 million to just $57 million during the period.
Management said that the results are in line with its update provided in March with the lower earnings largely stemming from the lower Lytton earnings, revised Woolworths fuel contract and higher crude oil prices resulting in lower retail fuel earnings.
The Lytton refinery FCCU was shutdown during the period but Caltex has said it is now operating at full capacity and management confirmed Lytton 2019 production guidance of around 5.8 billion litres.
Is Caltex in the buy zone?
The Caltex share price is trading broadly flat so far this year at $25.55 per share, a 1.5% increase on its 2 January valuation of $25.17 per share.
Caltex has seen its share price fall sharply in the last month or so from as high as $28.90 per share in late February as earnings headwinds and higher fuel prices have stemmed capital gains for the Aussie energy giant.
While its been challenging for many of the S&P/ASX200 Index (ASX: XJO) companies so far this year, the likes of Beach Energy Ltd (ASX: BPT) or Santos Ltd (ASX: STO) have still managed to outperform and could be a better option than Caltex at the moment.
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