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Z Energy appeared to be on track to achieve earnings near the top end of its latest guidance, Craigs Investment Partners broker Chris Timms said yesterday.
Z released its quarterly update yesterday showing it was undertaking a project to consolidate Caltex pricing data into Z's existing pricing system.
The project would start on February 27 and was expected to be completed by the second quarter of the 2018 financial year.
Mr Timms said Z had upgraded the expected synergy benefits accruing for the year. Net synergies for 2017 were expected to be $14million but the company had indicated the savings would be $17million.
The company's last operating earnings guidance for 2017 was between $385million and $415million. Craigs' forecast was $401million at the time.
The guidance range included $260million to $290million for the underlying Z business issued at the end of the year and $117million for Caltex.
Fourth-quarter sales were weak but that was in line with expectations, he said.
Caltex and Z's retail fuels were down 33million litres to 426million litres. Normalising for the promotional scheme changes and divestments, the trend was down less than 1%.
Z's retail petrol was down 13million litres to 186million litres and diesel was down 2million litres to 70million litres. The fall was due mainly to the loss of supermarket dockets but offset by a benefit from the FlyBuys and Airports programmes.
Caltex retail petrol sales fell by 15million litres to 126million litres and diesel was down 3million litres to 44million litres in the quarter. There was a significant impact on the operational performance from the 17million lost from sites divested, most of them Caltex retail sites.
The shares last traded at $3.76, down 13c or 1.76%.