Caltex regrets - cannot maximise profit rise - Business - Business - smh.com.au

CALTEX has forecast its first-half profit will rise as much as 14 per cent because of higher refiner margins but admits earnings could have been up to $100 million higher were it not for delayed refinery upgrades.
Australia's biggest petrol company was also accused of price gouging by motoring groups yesterday after it said refiner margins had averaged $US9.50 a barrel in the first half - an increase of more than 46 per cent on the same period last year.
"The evidence of gouging is there … the motorist is being exploited by oil companies," said the NRMA's motoring and services president, Alan Evans.
Mr Evans called on the Federal Government to bolster the powers of the Australian Competition and Consumer Commission to monitor fuel prices by making petrol a declared good.
But Caltex said the higher margins reflected demand for fuel, changes in fuel standards and higher levels of maintenance at refineries in the US and Asia.
Spokesman Richard Beattie said the accusations of price gouging were "simply untrue" because of the close correlation between benchmark fuel prices in Singapore and retail prices here.
"That close correlation has been confirmed time and time again by the ACCC," he said.
On its preferred "replacement cost of sales" measure, which factors out changes in oil prices, Caltex has forecast an after-tax profit of $160 million to $170 million for the six months to June 30, up from $149.6 million in the first half last year.
But it admitted the earnings could have been $80 million to $100 million higher than forecast if it had avoided delays to the upgrades of plants at its Sydney and Brisbane refineries.
Caltex has blamed the delays to both the cleaner fuels plants and maintenance on the Kurnell refinery in Sydney on a labour shortage and the late delivery of materials and equipment.
The last of the work was completed in May.
The Federal Government had granted Caltex a three-month extension to the cleaner fuel standards, which took effect on January 1.
Meanwhile, the oil company is disputing in the Federal Court a demand from the Tax Office to pay $48.7 million in excise duty.
The Tax Office believes the company should pay excise duty on the use of some fuel by-products in the refining process over the past four years.
Macquarie Equities analyst Andrew Blakely said the company's forecasts for the first half were broadly in line with market expectations.
Refiner margins of $US9.50 a barrel were a "pretty strong result" for Caltex but Mr Blakely said the "question is whether that's going to be sustainable".
Caltex rose 14c to $23.74.