10 November 2015, Lagos – Oando Plc on Monday sustained its bull run at the stock market, gaining the maximum daily 10 per cent to close at N8.50 per share, up from N7.72. The equity had last week appreciated by 28.5 per cent to recover from an unprecedented decline engendered by negative reactions to the company’s historic loss of N184 billion for the 2014 financial year.
However, respite came for the equity last week as investors renewed demand, leading to an appreciation of 28.5 per cent. The positive trend continued yesterday as the stock recorded another 10 per cent rise to lead other 24 price gainers for the day.
Oando Energy Resources (OER), the upstream subsidiary of Oando Plc, last week announced the repayment of its $100 million African Export-Import Bank (Afrexim) loan facility, which was utilised in financing the landmark $1.5 billion acquisition of the ConocoPhillips Nigerian Oil and Gas business in July 2014.
“A $91 million RBL Upsize was arranged by Standard Chartered Bank and African Export-Import Bank with participation from Standard Bank of South Africa Limited, Stanbic IBTC Bank Plc, and Natixis; while the proceeds, along with cash on hand, were used to repay the $100 Million Afrexim Facility,” Chief Executive Ofiicer, OER, Pade Durotoye had said.
He added that the upsizing of the RBL loan is a true testament to the quality of the assets they acquired in July 2014.
“The cash flows from these assets have continued to pay down the company’s post acquisition debt with the assistance of the value realised from the resetting of our hedge instruments, leaving a debt equity ratio of 0.57, compared with 0.91 in July 2014. OER remains focused on its financial and operational goals of strengthening its balance sheet and maintaining stable production levels through production optimisation in these times of reduced oil prices and limited capital investment. With the new global pricing reality, reduced investments, and industry shrinkage, Oando is reaffirming investors’ confidence in its operations and has espoused a strategic focus of aggressive debt reduction, optimisation of production levels, and inorganic growth through M&A deals that create immediate and long term equity value for shareholders,” Durotoye explained.
- This Day