Vivo Energy wants to grow the Engen business
At the beginning of the month, Vivo Energy acquired Engen International Holdings by issuing 63.2 million new shares and $62.1million (R884m) in cash to Engen for a 5 percent stake.
The transaction allowed Vivo Energy to add 230 Engen branded service stations and eight new countries to its network, which now includes 2130 service stations across 23 African markets.
The eight new markets are Gabon, Malawi, Mozambique, Reunion, Rwanda, Tanzania, Zambia and Zimbabwe. Engen’s operations in Kenya, where Vivo Energy already operates, is the ninth country included in the transaction.
“Our current plans are to maintain the Engen brand in the eight new operating countries, as we believe that the Engen brand is strong and well-established. However, we will rebrand Engen service stations in Kenya to the Shell brand in accordance with the Shell Brand Licence Agreement,” the group said.
Yesterday, Vivo Energy reported a 13 percent increase in net income to $146m for the year to end December, with full-year volumes up by 4percent, driven by a strong performance in its commercial business.
Revenue increased by 13 percent to $7.55bn, primarily driven by volume growth as well as rising crude oil prices from 2017 to 2018.
Earnings before interest, tax, depreciation and amortisation (Ebitda) was up by 6 percent to $400m, with adjusted diluted earnings per share of 0.14 US cents and diluted headline earnings per share of 0.11 US cents.
The group declared a final dividend of 1.3 US cents a share, bringing the full year dividend to 1.9 US cents.
Chief executive Christian Chammas said this had been a remarkable year for Vivo Energy.
“In 2018, we achieved volume growth of 4 percent at a gross cash unit margin of $73 per thousand litres, which drove adjusted Ebitda to $400m.
"During 2018 we have proved the resilience of the group’s footprint in the face of challenges in some markets. Looking forward we continue to see significant growth opportunities across our portfolio as we continue to enhance our position in our fast-growing markets across Africa,” Chammas said.
Under the retail fuel business, the group said it sold a record of 5354 million litres of fuel to its retail customers.
In the non-fuel retail business, Vivo Energy reported 15 percent increase in gross cash profit to $25m.