My Company - Caltex Australia Limited

We received our companies a little over a week go now which proved to be very exciting. The company I am to review is Caltex Australia.

So, why is this so exciting for me? Caltex Australia are fuel suppliers and retailers, who have service stations and refineries across Australia and they have a refinery just up the road from where I reside with my husband. Now, before you go thinking how unfortunate that might be, let me come straight to their defense! The Caltex Refinery, and Caltex Australia themselves do so much for our little community here in Kurnell. Kurnell is a little peninsula, a small suburb south of Sydney. Everyone should, however often aren't familiar with Kurnell, after all it is the birth place of Australia. Captain Cook first landed in Botany Bay (Kurnell) on 29th April 1770 and discovered Australia. Now, I am getting off track talking about the suburb I have come to love so much and not Caltex Australia. Although, part of the reasons I love this suburb and am proud to call it my home actually has a lot to do with Caltex Australia. Caltex Australia give a lot back to our little community, they make donations to the local primary school which allows them to update their facilities. They also assist in running a Santa visit for the kids every Christmas Eve in conjunction with the local Fire Station. Using their funds, Santa comes around in a decorated fire engine handing out lollies and visiting the kids. They drive the whole way around the suburb and every child waits enthusiastically outside their home for Santa to come past. Its very special and something that they need not organise and it isn't at all promoted by them to anyone outside of the suburb. Its not the type of information you'll find on their website or in their annual report but it certainly impacts the community and there is so much more that they do for Kurnell.

For those of you who aren't familiar with Caltex Australia, they are fuel suppliers and convenience retailers who, according to their company profile, feature the very best operational excellence in supply, refining, logistics and marketing. I am sure that most of the Australian based students have used a Caltex service station before, I know there are two service stations local to me which I have used in the past and there are many more across Sydney and Australia.They are also one of Australia’s largest convenience retailers and franchises, with over 85% of its stores operated by franchisees. According to their Company History page, their "roots" go back to 1900 however Caltex first opened refineries in the 1950's and 1960's with Ampol being their largest competitor however both companies were small in the market. In 1995 Caltex and Ampol merged and became the largest refiner-marketer in Australia. If you would like to learn more about Caltex, check out their website here http://www.caltex.com.au/Pages/default.aspx.

I have found and identified where Caltex Australia has their annual reports available and I have downloaded the past three years of these for review, I have included the links below if you would also like to have a look at these;

2014 Annual Report 
http://www.caltex.com.au/InvestorCentre/Documents/2014/2014%20Annual%20Report.pdf 

2013 Annual Report 
http://www.caltex.com.au/InvestorCentre/Documents/2013/2013%20Annual%20Report.pdf

2012 Annual Report
http://www.caltex.com.au/InvestorCentre/Documents/AnnualReports/Caltex%202012%20Annual%20Report.pdf 

With just a brief look over the 2014 annual report I have learnt some new facts about Caltex Australia which I have included briefly below;

• Caltex Australia are the only major brand listed on the Australian Securities Exchange
• Their financial year runs from 1st January through 31st December, funnily enough this interests me as I have only ever been involved in companies with the financial year beginning 1st July-30th June.
• They're share price increased by 71% from 31st December 2013 ($20.05) to 31st December 2014 ($34.21).
• They will be discontinuing the refining of oil at the Kurnell Refinery and it will instead be a fuel import terminal. This conversion commenced in 2012. 
• Their statements are set out in narrative format. 
• All of Caltex Australia's statements are consolidated statements. When researching what a consolidated income statement was, I came across this definition found on the Investor Guide website as 'an income statement for a group of enterprises and its parent company as a whole'. 
• According to their consolidated income statement their revenue is down in comparison to 2013.In 2013 their revenue was $24,676,383.00 in 2014 however it was recorded at $24,231,200.00. When 
• The consolidated income statement for the year ended 31 December 2014 includes significant losses of $160,163,000 which, as stated in the notes, were impacted largely by the conversion of the Kurnell Refinery which included remuneration payments, consulting fee's etc.

At this early stage of investigation into my companies annual reports, the following are some questions I have. Please bare with me, I am new to accounting and am totally intimidated by numbers, I feel like I almost become illiterate when it comes to accounting and mathematics.

• Caltex Australia Limited states that they are a company limited by shares, incorporated and domiciled in Australia. What does this mean? 
• Caltex only use consolidated statements, there are no separate statements. Are they not required to submit statements per entity? Is this because they are also franchised? 
• Within the consolidated income statement, and other statements for that matter, under the revenue figure all the other figures are shown in brackets i.e. Product Duties and Taxes. Are they shown in brackets because they are a loss? Are brackets replacing the minus symbol? 

I hope these are not stupid questions, as I mentioned, this is my first accounting subject and I am like a fish out of water. 

Being a local to the Kurnell Refinery I was aware of its conversion, we often receive mail about it from them, however, I was not aware of the costs involved. Many of the workers live locally, in fact, my neighbour was one staff member who was made redundant and after over 25 years service, I was aware that he was given quite a generous redundancy. I did a little research for news articles and came across the following.

This one article published in the Sydney Morning Herald explains how up to 630 jobs will be lost, both direct and contracting roles, as a result of the Kurnell Refinery Conversion.

 http://www.smh.com.au/business/caltex-axes-up-to-630-jobs-with-refinery-closure-20120725-22sd6.html 

This next article on the other hand says the 58 year old refinery will cost $270 million dollars over the two year process. They also state that BP were to close their Brisbane refinery this year, in 2015. 

http://www.heraldsun.com.au/business/breaking-news/caltex-shuts-kurnell-refinery/news-story/04effca75ca7f10efc2c627aaef64536?= 

Its understandable that the closure of the Caltex Refinery in Kurnell had a big impact on their figures which is shown in their 2014 report. 

I look forward to receiving feedback on my blog. I also hope that someone can enlighten me by answering my questions that I have listed above. 

Wishing everyone the best of luck with their studies.