Stocktake Australian Consumer Primer for 24 June 2026 – Viva Energy, Endeavour, Baby Bunting, U.S. Nielsen data

Research evidence excerpt

Stocktake Australian Consumer Primer for 24 June 2026 – Viva Energy, Endeavour, Baby Bunting, U.S. Nielsen data

J P M O R G A N Asia Pacific Equity Research

24 June 2026

Stocktake

Australian Consumer Primer for 24 June 2026 – Viva

Energy, Endeavour, Baby Bunting, U.S. Nielsen data

ACKey themes we are exploring today: AustralianBryan RaymondConsumer Sector

(61-2) 9003-6750

• Viva underlying refining earnings cut, offset by expected insurance bryan.raymond@jpmorgan.com

proceeds. Viva’s April/May refining margin trading update was below Christina Kim

(61-2) 9003-7082

expectations. The US$23.90 refining margin, while remarkably strong in christina.kim@jpmorgan.com

absolute terms, was below JPMe 2Q26 expectations of US$28.33. While the J.P. Morgan Securities Australia Limited

production run-rate was ahead of expectations (6.5mmbl over two months), the

disruption to the Residue Catalytic Cracking Unit (RCCU) and the Alkylation

unit has impacted the ability of the Geelong refinery to produce high margin,

finished products. The Alkylation unit being out of commission through to the

end of 2027 is driving a ~10% reduction in refinery production. We expect

business interruption insurance to recover ~80% of the earnings impact over

the next 18 months, however, this remains uncertain. After insurance proceeds,

we downgrade EBITDA by -5.2% in FY26e, -0.9% in FY27e and -0.4% in

FY28e. We lower our price target from $2.60 to $2.40 and maintain our Neutral

rating, with a preference for Ampol (OW) over Viva amongst the refiners.

Investors continue to look through unsustainably high refining earnings, which

is prudent, however, we believe the structural improvement in the business is

underestimated, particularly through: 1) FSSP phase 1 de-risking refining