Z Energy

Last updated

Z Energy Limited
Z
Company type Subsidiary
Industry Oil and gas
Predecessors Shell New Zealand (1911–2010) Greenstone Energy Limited (2010–2011)
Founded1911
Headquarters3 Queens Wharf,
Wellington, 6011
,
New Zealand [1]
Number of locations
262 [2]  (2023)
Area served
 New Zealand and Australia
Key people
  • Mike Bennetts (CEO)
  • Peter Griffiths (Independent Chairman)
[3]
Products Diesel, Petrol and Oil
Services Fuel Stations
RevenueIncrease2.svg $5.5 billion [4]  (2019)
Decrease2.svg $252 million [4]  (2019)
Total assets Increase2.svg $2.8 billion [4]  (2019)
Number of employees
2,656 [4]  (2019)
Parent Ampol
Subsidiaries
Website z.co.nz

Z Energy is a New Zealand fuel distributor with branded service stations. It comprises some of the former assets of Shell New Zealand and Chevron New Zealand. Shell left the New Zealand fuel distribution business in April 2010, selling its operations to Infratil and the New Zealand Superannuation Fund. [7] The former Shell operations were rebranded as Z Energy in 2011. Since May 2022, it is a subsidiary of Australian petroleum company Ampol.

Contents

It operates service stations under the Z Energy and Caltex New Zealand brands. There are 289 Z Energy branded sites around New Zealand, including 60 in Auckland as of April 2023. [8] There are also 203 Caltex branded sites, including 39 in Auckland as of April 2023. [9]

Background

Shell withdrew from the fuel distribution market in New Zealand in 2010. Shell's New Zealand assets, including a 17.1% stake in Refining NZ, were acquired by Infratil and the New Zealand Superannuation Fund for $891 million. [10] However the Taranaki based exploration and production division were not part of this sale portfolio. [11]

Z Energy currently competes with BP, ExxonMobil subsidiary Mobil NZ and several smaller independent groups such as Gull New Zealand. Former competitors included Chevron's New Zealand subsidiary Caltex which Z Energy acquired in June 2016.

Founding

In 2010 the branding remained as Shell whereas the holding company was renamed from Shell NZ to Greenstone Energy. After surveying 17,000 customers the following year, the company changed its name to Z Energy Limited and branded the service stations as Z. [12] The rebranding exercise is believed to cost around NZ$60m, compared to the NZ$10m/year cost of licensing the Shell brand. [13] The company said it would focus on better forecourt service and better food. [13]

Following the re-branding and after adding five new service stations, the market share for petrol held by Z Energy slipped from 31.6% in 2011 to 29.0% in 2013. [14]

Following the change in ownership, the firm has employed more New Zealanders in positions that were previously outsourced overseas including: IT, [15] finance and call centre services. [16]

Acquisition

In 2010, Infratil and New Zealand Superannuation Fund paid for the Shell acquisition and its 17.1% shareholding in NZ Refining with $420 million of equity funding. [10]

At the time of the acquisition from Shell, Z Energy had an ungeared balance sheet. The balance of the acquisition cost was met by borrowings by Z Energy. [10]

The stake in NZ Refining was sold to Z Energy after the IPO for $100 million. The net outlay by Infratil and New Zealand Superannuation Fund for 100% of Z Energy in 2010 was effectively $320 million. [14]

In 2011, the 226 Shell service stations were rebranded as Z Energy stations. [17]

Z Energy had $430 million of retail bonds at March 2013, up from zero debt in 2010 when Infratil and NZ Super Fund acquired it. [14]

IPO

Before the IPO

The majority of the Z Energy service stations are off-balance sheet. 152 service stations are leased by Z Energy from third parties and five are independently owned. Z Energy owns 56 service stations freehold. Z Energy sold and leased back 47 service stations in 2012–13 for cash proceeds of $87 million. [14]

Z Energy revalued upwards its remaining property plant and equipment by 54% or $170 million to a total of $481 million in April 2013. [14]

The company also paid dividends totaling $224 million to Infratil and the New Zealand Superannuation Fund in the three-year period before the IPO, including $70 million between April 2013 and the IPO. [14]

IPO

In July 2013, shares in Z Energy were offered in an IPO which was priced at $3.50 per share. [14] That IPO valued Z Energy at $1.4 billion. This value was almost four and half times the net cash outlay by Infratil and NZ Super Fund to acquire it three years earlier.

The IPO prospectus showed that Z Energy expected to declare total dividends to shareholders equivalent to 6 cents per litre of fuel sold in 2013–14. This includes dividends to be paid to Infratil and NZ Super Fund immediately prior to the IPO.

Tim Hunter, deputy editor of the Fairfax Business Bureau, said that in completing the IPO, Infratil and NZ Super Fund will "have pulled off a piece of exceptional business". [18]

Z Energy issued a prospectus for its non-underwritten IPO on 25 July 2013. The IPO will raised $840 million from a mixture of shares sold by the current parent and new shares issued. [14]

All of the proceeds went to Infratil and New Zealand Superannuation Fund, including funds raised by the issue of new shares in Z Energy Limited. Z Energy purchased the 17.1% stake in NZ Refining for $100 million from Infratil and New Zealand Superannuation Fund after the IPO.

Following the IPO, Z Energy has 400 million shares in total. The IPO price was $3.50. This provided a market capitalisation of $1,400 million. [14]

That market value is almost four and half times the net cash outlay of $320 million by Infratil and New Zealand Superannuation Fund to acquire Z Energy in 2010.

Infratil and New Zealand Superannuation Fund retained a combined stake of 40% in Z Energy. Z Energy is forecasting sales to fall to 2,476 million litres in 2013–14. This is 7% less than the volume in 2010-11 after addition of the five new service stations. [14]

As the basis for Prospectus forecasts, Z Energy's profit margin was expected to increase by 1.2 cents per litre in 2013–14. The Prospectus forecast a dividend of $88 million for the 2013–14 year which is equivalent to 3.5 cents per litre sold. In addition, Z Energy paid $70 million in dividends to Infratil and New Zealand Superannuation Fund earlier in the 2013–14 year. That is a total of 6 cents in dividends per litre in 2013–14. [14]

Acquisition of Chevron New Zealand

In April 2015, Z Energy released a statement on the intent to buy Chevron's subsidiary in New Zealand. The acquisition agreement was signed on 2 June 2015 at a cost of NZ$785 million and would have to be approved by the Overseas Investments Office (OIO) and the Commerce Commission. [19] The acquisition also included Caltex lubrications and engine oils interests.

Z Chief Executive Mike Bennetts said that the Caltex and Challenge! brands, owned by Chevron, would continue under their own respective banners as Caltex and Challenge! were trusted brands in New Zealand. This acquisition would boost Z Energy's market share in New Zealand to 49%. [19] This acquisition was approved by the Commerce Commission in April 2016. [20] The acquisition was finalised on 1 June 2016. [21] [22]

Shareholders

Shareholder sell-down

On 30 September 2015 Infratil and the New Zealand Superannuation Fund released individual statements and press releases stating that they would each divest from Z Energy. Infratil will divest the entirety of their shareholding whilst the Super Fund will divest 9.25%, reducing their shareholding to 10.75%. Further in the statement of Infratil they stated the float will begin on 2 October 2015 for an average of NZ$6.00 to $6.20. The Super Fund released their statement after the closing of NZX so as to not lower the share price of Z Energy for the day's closing. In the press release the Super Fund announced "[they] would retain more than a 10 per cent share in the business; reflecting [its] confidence in Z Energy's business strategy and management team". The 29.25% offload has raised close to NZ$840 million for the two founding companies of Z Energy. It was also reported that Infratil has had a 400% return on their initial investment in Z Energy. [23] [24]

In 2016, further offloads started to occur with Infratil selling its remaining shares for a total of NZ$479.2 million. [25] Whereas the New Zealand Superannuation Fund (NZSF) sold roughly 8.5% of their remaining 10% at NZ$8.01 per share; bringing the total profit for NZSF from the Z offload to NZ$1.09 billion with an initial investment of NZ$209.8 million. [26]

Ampol takeover bid

In August 2021, Australian fuel company Ampol launched a takeover bid for Z Energy for NZ$2 billion. [27] In May 2022, the takeover was completed. [28]

Assets

Z Energy currently holds three wholly owned subsidiaries, Harbour City Properties Investments Limited for property investments and holdings as well as Z Energy ESPP Trustee Limited and Z Energy LTI Trustee Limited for trustee purposes.

Z Energy supplies 210 branded service stations and commercial, aviation, marine, chemical and bitumen clients. The company also manufactures surfactant chemicals operates coastal oil tankers, tank farm terminals and a mobile refueller. [29]

New Zealand Oil Services Limited

Z Energy acquired a stake in this joint venture established in March 1999 by Mobil, BP Oil, and Shell NZ. Mobil left the partnership in 2000. Currently Z Energy and BP hold a 50% stake each.

The New Zealand Refining Company

Z is considered to have significant influence over its investment in The New Zealand Refining Company (Refining NZ) due to the fact that it has representation on the Board of Directors and therefore has equity accounted this investment. Based on its closing share price of $2.60 the fair value of the Group's investment in Refining NZ is $125m (2014: $1.75, $84m). Z's holding in Refining NZ is 15%.

Loyalty New Zealand Limited

Launched in 1996, Loyalty New Zealand runs Flybuys which has 2.4 million cards issued to 74% of New Zealand's households. This 25% joint operation is currently held by Z Energy, New World, State, and Bank of New Zealand.

Caltex brand in New Zealand

Z Energy also operates the Caltex brand in New Zealand under a licensing agreement with Chevron International (owner of the Caltex brand), as a result of Z's purchase of Chevron New Zealand in June 2016. This allows Z to operate both Z and Caltex brands in the country. In March 2022, the licensing agreement was renewed to allow Z to continue using the Caltex brand for a further five years. [21]

Controversy

In August 2011, an advertisement by Z Energy sparked outrage through the depiction of 'New Zealand'-looking people stripping call centre equipment off 'Asian'-looking workers. [30] Mike Bennetts subsequently apologised and Z Energy released a new advertisement showing a diverse range of actors. [31]

Related Research Articles

Texaco, Inc. is an American oil brand owned and operated by Chevron Corporation. Its flagship product is its fuel "Texaco with Techron". It also owned the Havoline motor oil brand. Texaco was an independent company until its refining operations merged into Chevron in 2001, at which time most of its station franchises were divested to Shell plc through its American division.

<span class="mw-page-title-main">Chevron Corporation</span> American multinational energy corporation

Chevron Corporation is an American multinational energy corporation predominantly specializing in oil and gas. The second-largest direct descendant of Standard Oil, and originally known as the Standard Oil Company of California, it is headquartered in San Ramon, California, and active in more than 180 countries. Within oil and gas, Chevron is vertically integrated and is involved in hydrocarbon exploration, production, refining, marketing and transport, chemicals manufacturing and sales, and power generation.

Tranz Rail, formally Tranz Rail Holdings Limited, was the main rail operator in New Zealand from 1991 until it was purchased by Toll Holdings in 2003.

<span class="mw-page-title-main">SuperAmerica</span> Gas station chain

SuperAmerica was a chain of gasoline stations and convenience stores in the Upper Midwest, based in Woodbury, Minnesota. It was owned by Marathon Petroleum. The first convenience store opened in the 1960s. SuperAmerica had 278 stores with 271 in Minnesota, 11 in Wisconsin and 2 in South Dakota.

<span class="mw-page-title-main">Manawa Energy</span> New Zealand electricity generation and retailing company

Manawa Energy limited is a New Zealand electricity generation company that offers bespoke electricity products to commercial and industrial customers across New Zealand. Manawa energy currently operate 26 power schemes from the Bay of Plenty in the north, to Otago in the south.

<span class="mw-page-title-main">Mercury Energy</span> New Zealand electricity generating and retailing company

Mercury NZ Limited is a New Zealand electricity generation and multi-product utility retailer of electricity, gas, broadband and mobile telephone services. All the company's electricity generation is renewable. Mercury has a pre-paid electricity product sub-brand GLOBUG. Mercury Energy is also the largest electricity retailer in New Zealand.

<span class="mw-page-title-main">Infratil</span> New Zealand investment company

Infratil Limited is a New Zealand-based infrastructure investment company. It owns renewable energy, digital infrastructure, airports, and healthcare assets with operations in New Zealand, Australia, Asia, the US and Europe. Infratil was founded by the late Lloyd Morrison, a Wellington-based merchant banker. Morrison's company, H. R. L. Morrison & Co, is responsible for Infratil's management and administration.

<span class="mw-page-title-main">EG Australia</span> Australian convenience store and fuel station chain owned by British EG Group

EG Australia is the Australian subsidiary of British company EG Group which operates the EG Ampol chain of petrol stations, selling Ampol fuel at its stations. As of October 2022, there are over 540 EG Ampol petrol stations. The service stations were acquired from Woolworths in April 2019 for $1.72 billion.

<span class="mw-page-title-main">Caltex</span> International petroleum brand owned by Chevron Corporation

Caltex is a petroleum brand name of Chevron Corporation used in the Asia-Pacific region, the Middle East, and Southern Africa. Headquartered in Singapore, it is also the brand name of non-Chevron petroleum companies in some countries under a trademark licensing agreement with Chevron.

<span class="mw-page-title-main">Ampol</span> Australian multinational petroleum retail company

Ampol Limited is an Australian petroleum company headquartered in Sydney, New South Wales. Ampol is the largest transport energy distributor and retailer in Australia, with more than 1,900 Ampol-branded stations across the country as of October 2022. Ampol also operates in New Zealand through its subsidiary Z Energy.

Challenge is a chain of independently owned petrol stations around New Zealand.

Türkiye Petrol Rafinerileri A.Ş. is a company in Turkey, operating four refineries with a total capacity to handle an annual 30 mn tons of crude.

Morrison is a specialist global infrastructure manager, investing in both private and listed markets, with offices in New Zealand, Australia, United Kingdom, United States and Singapore.

<span class="mw-page-title-main">New Zealand Superannuation Fund</span> Sovereign wealth fund of New Zealand

The New Zealand Superannuation Fund is a sovereign wealth fund in New Zealand. New Zealand currently provides universal superannuation for people over 65 years of age and the purpose of the Fund is to partially pre-fund the future cost of the New Zealand Superannuation pension, which is expected to increase as a result of New Zealand's ageing population. The fund is a member of the International Forum of Sovereign Wealth Funds and is therefore signed up to the Santiago Principles on best practice in managing sovereign wealth funds.

<span class="mw-page-title-main">Puma Energy</span> Swiss oil company

Puma Energy is a Swiss multinational mid- and downstream oil company, majority-owned by Singapore-based Swiss company Trafigura.

Vivo Energy is a British downstream petroleum company with its headquarters in London. It maintains subsidiaries and operations in 23 countries across Africa that encompass the supply, storage, distribution, and retail of a range of petroleum products. Vivo Energy is a Shell and Engen Petroleum licensee and sources, distributes, markets and supplies fuels and lubricants. It was listed on the London Stock Exchange and the Johannesburg Stock Exchange and was a constituent of the FTSE 250 Index and of the JSE All Share Index until it was acquired by Vitol Group in July 2022.

Ngāi Tahu Holdings Corporation Limited is owned by the Ngāi Tahu iwi of the South Island of the New Zealand. Its main interests are in tourism, fisheries, property and forestry and it is among the wealthiest iwi in New Zealand. Ngāi Tahu annually contributes more than $200 million to the South Island economy.

<span class="mw-page-title-main">Viva Energy</span> Oil company based in Australia

Viva Energy is an Australian company that owns the Geelong Oil Refinery and retails Shell-branded fuels across Australia under a license agreement. It also owns and retails Liberty Oil and Westside Petroleum-branded service stations. In total, Viva Energy supplies a network of over 1,330 fuel outlets across Australia. In addition to the Geelong Refinery, it imports fuel supplied by Vitol through 22 import terminals.

Gull New Zealand is a New Zealand petroleum distribution company and petrol station chain. It is the country's third largest fuel retailer, with 113 locations in New Zealand including 45 in Auckland.

References

  1. ↑ "Contact us". Z.co.nz. Retrieved 6 June 2015.
  2. ↑ https://www.z.co.nz/find-a-station/
  3. ↑ "Z Energy Limited Ordinary Shares (ZEL)". NZX.
  4. 1 2 3 4 "Z Energy Annual Report 2019". December 2022. Archived from the original on 10 February 2022.
  5. 1 2 3 4 "Z Energy Annual Report 2014". Z.co.nz. Retrieved 6 June 2015.
  6. ↑ "Z Energy buys Caltex - The Bob Dey Property Report". Propbd.co.nz. Retrieved 6 June 2015.
  7. ↑ "'Neo-Kiwi' brand fuels change". Webcitation.org. Archived from the original on 13 June 2011. Retrieved 6 June 2015.{{cite web}}: CS1 maint: unfit URL (link)
  8. ↑ "Z Energy". z.co.nz. Z Energy.
  9. ↑ "Caltex". caltex.co.nz. Z Energy.
  10. 1 2 3 Aotea Energy Limited. "Financial Statements Yr to 31 Mar 2011". NZ Companies office. Retrieved 3 August 2013.
  11. ↑ "Z to take over Shell". Webcitation. Archived from the original on 27 April 2011. Retrieved 6 June 2015.{{cite web}}: CS1 maint: unfit URL (link)
  12. ↑ Bradley, Grant (11 May 2011). "Goodbye Shell - hello Z Energy". New Zealand Herald .
  13. 1 2 Rutherford, Hamish (11 May 2011). "Z to take over Shell". Stuff.co.nz. Archived from the original on 12 May 2011. Retrieved 4 May 2016.
  14. 1 2 3 4 5 6 7 8 9 10 11 "Z Energy IPO Prospectus". Infratil. Retrieved 3 August 2013.
  15. ↑ Ogden, Gavin (4 June 2010). "Greenstone handpicks Integral Axon". techday. Archived from the original on 9 October 2011.
  16. ↑ "Greenstone Energy boosts headcount". The New Zealand Herald . 17 June 2010. Retrieved 11 September 2011.
  17. ↑ Bradley, Grant (11 May 2011). "Goodbye Shell - hello Z Energy". New Zealand Media and Entertainment. New Zealand Herald.
  18. ↑ Hunter, Tim (4 August 2013). "Smart team behind Z offer". Sunday Star Times. Fairfax NZ.
  19. 1 2 "Z Energy in $785m Caltex NZ takeover deal". Convenience and Impule Retailing. 3 June 2015.
  20. ↑ "Z Energy cleared to acquire Chevron subject to divestments". Commerce Commission of New Zealand. 29 April 2016.
  21. 1 2 "Caltex brand to continue in NZ". Z Energy. 22 March 2022. Retrieved 19 June 2022.
  22. ↑ "Caltex in New Zealand" . Retrieved 13 September 2017.
  23. ↑ "Z Energy sale completed". Stuff. October 2015. Retrieved 4 May 2016.
  24. ↑ "Z Energy shares may not fall far". Stuff. 29 September 2015. Retrieved 4 May 2016.
  25. ↑ "Infratil reaps $329m profit on Z Energy share sale".
  26. ↑ "NZ Super Fund sells down stake in Z Energy".
  27. ↑ "Ampol make $2b takeover bid for Z Energy". Radio New Zealand. 23 August 2021.
  28. ↑ "Ampol completes acquisition of Z Energy" (PDF). Australian Securities Exchange. Ampol. 10 May 2022.
  29. ↑ "Infratil - Greenstone Energy: Profile". infratil. Archived from the original on 11 July 2010.
  30. ↑ Pinkerton, N (12 August 2011). "Z Energy: building its brand on shaky ground". Dominion Post . Retrieved 6 June 2015.
  31. ↑ Johnson, S (9 August 2011). "We're happy Kiwis until someone dares to be 'Asian' ". The New Zealand Herald . Retrieved 6 June 2015.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.