06 November 2017, Sweetcrude, Lagos — Oando Plc has declared a N7.1 billion profit after tax for the last nine months period which ended September 30th, 2017.
A statement signed by the company’s Chief Compliance Officer & Company Secretary, Ayotola Jagun, and its Head, Corporate Communications, Alero Balogun, disclosed that the September financial statement is an unaudited results for the nine months period which ended on 30th September, 2017.
Commenting on the results Wale Tinubu, Group Chief Executive, Oando PLC said the profit was a sign of success for the company as a result of recapitalization, asset divestments and expansion.
“Our third-quarter financials are reflective of the success of our strategic initiatives of Growth through our dollar earning upstream portfolio; Deleverage through recapitalization and asset divestments and the expansion of our oil export trading business. The proceeds from our business restructuring have been successfully used in improving our balance sheet with a reduction of N21 billion in our net debt position from N230.6 billion as at December 2016 to N209 billion today. Despite prevailing headwinds, we continue to create value as seen in our improved performance four quarters in a row and remain confident about the resilience of our business model,” he said.
The report showed that turnover increased by 16%, N383.5 billion compared to N329.9 billion recorded in third quarter, Q3 2016.
Oando also stated that its gross profit increased by 148%, N71.2 billion compared to N28.6 billion in Q3 2016, adding that profit-after-tax increased by 120%, N7.1 billion compared to N35.8 billion in Q3 2016.
On its upstream activities, the statement said Oando Energy Resources, OER, recorded an average production of 39,844 boe/day in the nine months ended September 30, 2017 compared to 43,617 boe/day in the comparative period of 2016, with a net income of N26.97 billion ($88.2 million) compared with a net profit of N2.51 billion ($8.2 million) recorded in the comparative period of 2016.
On its midstream activities, Oando Trading, OTD, recorded a 48% increase in turnover to N305.75 billion ($1 billion) compared to N206.69 billion ($676 million) in the comparative period of 2016, traded over 11 million barrels crude oil volumes and 800,000MT of Refined Petroleum Products, a 25% growth in traded volumes, according to the report.
It also said the Lagos Marine Jetty, LMJ, officially commenced operations receiving its first product vessel.
“The fourth quarter presents an optimistic outlook for the Nigerian oil and gas sector having experienced a third quarter characterized by an oil price increase of 14% from July to September 2017 compared to the same period in 2016. The country also officially exited a 13 month long recession with a positive Gross Domestic Product (GDP) growth of 0.55% in the second quarter of 2017 buoyed by OPEC’s cut in oil production and exemption of Nigeria from the production cut, stability in oil prices and a boost in the nation’s oil production due to the ongoing truce with Niger Delta militants”.
“This was primarily due to significant reductions in gas production and delivery caused by a ruptured Gas Transmission System (GTS-4) gas line which supplies gas to the Nigerian Liquefied Natural Gas Limited (NLNG). Downtime suffered by the Trans Forcados pipeline led to repairs and planned maintenance activities that resulted in reduced production from Ebendo (OML 56)”.
“OER recorded a net income of N26.97 billion ($88.2 million) compared with N2.51 billion ($8.2 million) in the comparative period of 2016. The increase in profitability was primarily due to improved revenue from the sale of OML 125 & 134, lower production expenses, reduction in depreciation and net losses on financial instruments which were offset by lower tax recoveries”.