Vivo Energy volumes rise 15% in the third quarter
The pan-African fuel retailer expects profit growth due to higher volumes and better sales margins
Vivo Energy, which operates fuel stations in Africa, is upbeat about its profit prospects for its year to end-December, after the boost in volumes from its Engen acquisition helped to lift its margins.
Vivo added 230 new stations in eight African countries when it completed its transaction with Engen in March, with CEO Christian Chammas saying on Friday the ramp up in volumes had boosted gross cash profit margins.
“We are bullish about delivering on our promises,” he said during an investor presentation.
The group reported on Friday gross cash profit had risen 13% in its third quarter to end-September, due to higher sales volumes and better margins.
Gross cash profit for the three months through September rose to $189m (R2.7bn) year on year, while sales volumes rose 15% to 2.67-billion litres.
Year-to-date group volume growth increased to 10% against the comparable period, with the company expecting volume growth for the full year, including the Engen-branded markets, to be within its guidance range of low to mid double-digit percentage growth, the statement read.
Group year-to-date gross cash unit margins were $70 per thousand litres, and was expected to be slightly ahead of initial guidance of the high sixties per thousand litres for the full year, the company said.
Chammas said on Friday the company was seeing volume drops in Tunisia and Côte d'Ivoire due to economic conditions in those countries. Tunisia would likely correct over the next two years, however, and Côte d'Ivoire over the next twelve months, he said.
At 12.45pm on Friday Vivo Energy’s share price was up 0.4% to R22.50, unchanged from the beginning of 2019.