10th Dec 2015 09:50
LONDON (Alliance News) - Transportation management company Rotala PLC Thursday said it has continued to hedge as much of its fuel requirements as possible to try and take advantage of lower oil prices.
The company, which operates bus, coach and other transportation services said it currently needs around 11.0 million litres per year of fuel to conduct its operations, and said it paid around 108.0 pence per litre in the year ended November 30.
At the end of 2014, Rotala was only expecting to need around 10.0 million litres of fuel for 2015.
To put that into perspective, there is around 159 litres in one barrel of oil, with barrels usually being sold at a wholesale level by producers to petrol providers and other companies that then sell it in litres, such as in petrol stations.
Since oil prices began falling in the middle of 2014, the company has tried to take advantage of lower prices by hedging as much of its requirements as possible.
For 2016, it has so far hedged 89% of its fuel requirement at an average price of 101.0p per litre. At the end of 2014, it had only hedged 84% of its requirement at a price of 102.0p.
For 2017, Rotala has hedged 84% of its fuel requirement at a price of 95.0p per litre, compared to the end of 2014 when it had only hedged 70% of its requirement at 96.0p per litre for 2017.
For 2018, Rotala has hedged 89% of its fuel requirement at 91.0p per litre. Last week, Rotala said it had hedged its first lot of fuel for 2018, but at that time had only hedged 43% of its requirement at the same price.
"The board will continue to monitor market conditions closely and take out such further fuel hedges as it deems are appropriate to meet its objective of reducing volatility and creating business certainty," said Rotala.
Rotala shares were trading up 0.7% to 64.95p on Thursday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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