Gull acquisition beating expectations for Caltex Australia

Caltex Australia had its first annual contribution from Gull New Zealand. Photo / File

Discount fuel retailer Gull New Zealand beat expectations for its new owner, Caltex Australia, as it contributed to a more than doubling in annual earnings for the ASX-listed group's international units.

Caltex Australia, which no longer has any ties with Texan giant Chevron, bought Gull in 2017 for $340m and had its first annual contribution from the Kiwi challenger petrol brand.

The group generated revenue of A$559.1m ($581.6m) from New Zealand in calendar 2018, up from A$203.5m a year earlier, when Caltex bought Gull. Gull contributed to Caltex's 39 per cent increase in international fuel sales volumes to 3.5 billion litres, alongside the group taking over supply management for Seaoil Philippines and more third-party sales.

International earnings before interest, tax, depreciation and amortisation soared 172 per cent to A$75m, compared to a 5 per cent increase in ebitda for the dominant Australian fuel and infrastructure arm at A$435m.

Caltex is keen to grow international earnings for its fuels and infrastructure division, including more growth from Gull, which it said is exceeding the acquisition case.

In August, Caltex said Gull was growing in line with expectations after the first half.

The Gull 87-strong network consists of 63 controlled retail sites, including 40 that are unmanned, and 24 supply sites. When Caltex bought the challenger brand, there were only 77 sites.

Caltex's group profit fell to A$519m in calendar 2018 from A$619 million a year earlier. Excluding changes in the valuation of inventory, earnings were A$558m, down from A$638m.

The board declared an unchanged final dividend of 61 Australian cents per share, payable on April 5, taking the annual return to A$1.18 a share.

The company also plans to buyback about A$260m of stock off-market.

The ASX-listed shares rose 5 percent to A$28.98, taking this year's gain to 14 per cent.