Vivo Energy shares leap on positive trading update
Business Report

Vivo Energy shares leap on positive trading update

Vivo Energy shares leap on positive trading update

By Sandile Mchunu Time of article published 34m ago

Share this article:


DURBAN – VIVO Energy’s share price rose by more than 9 percent on the JSE on Friday after the group said it expected its full-year earnings to be ahead of market expectations and announced its intention to declare a dividend of 3.8 cents a share.

Vivo Energy has more than 2 000 Engen-branded service stations across 23 African markets.

The share price reached a day high of R17.20 a share after the positive trading update, up from Thursday’s closing price of R15.66. It closed Friday up 5.36 percent at R16.50.

The Pan-African retailer and distributor of Shell and Engen-branded fuels and lubricants, said it predicted that its adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) for the year to end December, to be above the top end of the current market expectations of between $331 million (R4.85 billion) and $354m, with the second-half performance broadly in line with the second half of the 2019 performance.

However, the expected Ebitda would still fall below the $431m amount reported a year earlier.

Trading across the group continued to be positive in the fourth quarter, driven by the ongoing recovery in the retail segment, as mobility restrictions across its host countries remained limited.

“This continued the momentum built in the third quarter and led to full year fuel volumes of 9.6 billion litres, 7 percent below the previous year. Performance was also supported by the unit margin tailwinds experienced in the third quarter continuing through the final quarter,” the group said.

Chief executive Christian Chammas said the Covid-19 pandemic had a significant adverse impact on their business in the first half of 2020.

“Since then the group has recovered strongly, with the second half in line with the comparable period in 2019, and this positive performance has continued into 2021. As a result, we are cautiously optimistic, and believe that we are well positioned for the future due to our leading positions in structural growth markets, together with our diversified and resilient business model,” Chammas said.

As a result of the positive performance in the fourth quarter, the board intended to recommend to shareholders the payment of a dividend of 3.8c a share, which equals to $48m in respect of 2020.

Chammas said this is in line with their stated progressive dividend policy.

The group expects to release its full-year results on March 3.

[email protected]


Original Article

Related posts

BLOCKCHAIN TECHNOLOGY: Bridging the digital skills gap is key to addressing unemployment


Ramaphosa touts buying local as job creator


GameStop’s stock rises in early deals, set for second best week