Caltex eyes retail assets sale

CALTEX Australia says it is considering selling part of its convenience retail assets valued at $2 billion, even as higher costs kept its first-half profit at the lower end of its guidance.

The refiner and fuel retailer said it was exploring a potential real-estate partnership, which could include the sale of 15 to 25 per cent of its existing freehold site portfolio, with Caltex retaining between a 25 per cent and 50 per cent stake. The company’s branded convenience stores include names like Star Mart and Woolworths.

Caltex said net profit on a “replacement cost” basis crept higher to $296 million for the six months to June 30, from $294 million a year earlier, as margins were hurt by higher crude prices and corporate costs. The company in June forecast half-year underlying profit between $295 million and $315 million. Retail earnings also declined 14 per cent.

Brent crude prices have surged about 14 per cent so far this year. Caltex’s solitary oil refinery, at Lytton in Brisbane, suffered lower refining margins, down 18.6 per cent.

The company said it would pay 57 cents per share as interim dividend, down from 60 cents for the first half of 2017.