Refining NZ announces non-cash impairment

Refining NZ today announced that it expects to recognise a non-cash impairment charge in the order of $220 million before tax ($158 million after tax) in the 2020 half-year results. The impairment charge is primarily due to revised refining margin assumptions, reflecting the excess refining capacity in the Asia-Pacific region and the effects of the COVID-19 pandemic on transport fuel demand, particularly jet demand. Refining NZ sets its long-term refining margin assumptions based on independent energy analyst forecasts. The company remains comfortably within the 45% senior debt gearing covenant under its Facility Agreements at 27% following the impairment, which will also not impact on interest cover ratios that the company continues to meet in the current low margin fee floor environment. The impairment charge is a non-cash item and is subject to finalisation and Board approval of the half-year financial statements. Refining NZ will release its 2020 half-year results on 17 August 2020. Ends. For further information: Ellie Martel Government and External Affairs Manager Ellie.Martel@refiningnz.com +64 (0)20 4174 7226 End CA:00357371 For:NZR Type:MKTUPDTE Time:2020-08-04 08:30:44