2008 Half Year Review

The increase in working capital is primarily due to:

• Higher crude and product prices (crude average June 08 US$131.30 per barrel vs. December 07 US$100.85 per barrel), partially offset by the higher Australian dollar;
• Higher inventory volumes (+91ML) driven by an increase in imports as a result of higher planned and unplanned shutdown activity; and
• Higher receivables due to increased sales volumes and prices.

Partly offset by:

• Increase in provision for income tax payable due to higher taxable income.

The increase in property, plant and equipment is due to:

• Capital expenditure and accruals, including major cyclical maintenance, of $211 million;

Partly offset by:

• Depreciation of $81 million; and
• Net disposals of $22 million.

Net debt increased to $645 million at 30 June 2008, an increase of $63 million from 31 December 2007. As a result, Caltex’s gearing (net debt to net debt plus equity) was 17.4%, increasing from 17.1% at 31 December 2007. On a lease-adjusted basis, gearing at 30 June 2008 was 22.6% compared with 24.6% at 31 December 2007.

Other non-current assets and liabilities have increased primarily due to increases in superannuation liabilities and increased non-current remediation provisions.