Investment Matters

Company News: Viva Energy, Aurelia Metals and Garda Property Group

Australian Equities Portfolio

Viva Energy (positive impact) will benefit from a decision by the Federal Government to provide an interim Refinery Production Payment for six months from the 1st of January 2021.

Under the arrangement, domestic fuel refiners (such as Viva) will receive 1 cent per litre for the production of primary transport fuels (gasoline, diesel and jet). The payment precedes a longer-term program which is expected to be implemented before the 1st of July 2021.

Viva expects the payments to contribute $30 m towards the operating profit of its refining segment for the first half of calendar year 2021. As we have mentioned, Viva’s share price has often reacted to changes in refining margins, which can swing considerably year-to-year.

The Federal Government payments will provide some stability to refining margins, particularly in the short term where demand has been depressed but also signals a recognition of the strategic importance of domestic refining capacity in the longer term.

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Aurelia Metals (mixed impact) announced promising exploration results from its Federation deposit. The announcement detailed the identification of promising high-grade gold and base metal zones (>100g/ton) and the potential to extend the current resource, with an updated resource estimate expected in January. The company also reported operational issues with its main haulage shaft at its Peak mine, which is expected to be rectified within the coming weeks.

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Property Portfolio

Garda Property Group (positive impact) announced that it has leased Botannica 9, a commercial office property located in Richmond, to a foundation tenant in Fuji Xerox. The 7-year lease will see Fuji Xerox occupy one-third of the building’s net lettable area.
The recently completed building represents the majority of the current vacancy in the trust’s portfolio.

 

The above market commentary represents the views and opinions of First Samuel Pty Ltd. Such market commentary contains information of a general nature only. Such market commentary is not intended to provide a sufficient basis on which to make any investment decision and should not be taken as such. It has not taken into consideration your objectives, needs or financial situation. Before making decisions in relation to any financial product, you should always obtain and read any relevant Product Disclosure Statement or information statement and seek personal financial advice.