Oando Plc, one of the Nigeria’s leading oil and gas companies, has declared a profit after tax (PAT) of N4.6 billion for the half year ended June 30, 2017, as against a loss of N26.9 billion in the corresponding period of 2016.
A review of Oando’s financials show that turnover increased by 26 per cent to N267.1 billion from N212.3 billion in 2016 while gross profit increased by 76per cent to N33.4 billion from N19 billion.
Net finance costs reduced from N35.3 billion to N16.4 billion, leaving the firm with a PAT of N4.6 billion compared with a loss of N26.9 billion in H1 2016.
For the third time in a row, Oando has posted positive financials defying speculations and bolstering confidence in the oil and gas sector. In its final year-end, 2016 results the company declared N3.5 billion PAT, in the first quarter of 2017 it posted N1.7 billion PAT and the N4.6 billion PAT for H1 2017.
These numbers are indicative of the company’s ability to manoeuvre the cyclical nature of the sector by adapting quickly to continued low oil prices. Oando has done this through the successful implementation of its corporate strategic initiatives of growth, deleverage and profitability alongside its renewed focus on its dollar earning businesses.
Commenting on the results, Group Chief Executive, Oando Plc, Mr. Wale Tinubu, said: “With security concerns in the Niger Delta receding, Nigeria’s economic recovery has been buoyed by a boost in oil output, while the legislative approval of certain segments of the Petroleum Industry Bill (PIB) provides greater long-term policy certainty for the sector. Our returns underline our continued successful foray into the Upstream.”
According to Wale Tinubu, Oando scored significant operational highlights in the first half of 2017.
The company through its upstream business, Oando Energy Resources, successfully realised N3.2 billion in net cash from the crystallisation of the corporate facility hedges (1,590 bbls/day) while in the second quarter of 2017, it successfully completed the sale of its interest in OMLs 125 and 134 to Nigerian Agip Exploration Limited for a profit of N4.6 billion.
In its Downstream business, Oando Trading (OTD), the company witnessed a 40 per cent growth in traded volumes and a commendable 147 per cent increase in turnover to N217.5 billion compared to N88.1billion for the comparative period of 2016.
The trading business lifted volumes exceeding 7.5mmbbls of crude and imported 610,000metric tonnes of refined petroleum products, a 72 per cent and 20 per cent increase respectively.
The Structured Trade Finance lines in its downstream business increased by N76.5 billion to N214.1 billion in total, from a total of five International and African banks, are further validation that Oando is still a good business investment.
According to the company, this increase in financing allows the company to achieve greater trading capacity and in turn more volumes.
Speaking on the outlook for the company in the second half of 2017, Tinubu said: “We remain committed to optimising our overall production base, seeking unique profit-driven opportunities to further partner with international oil companies, while firming up our balance sheet to provide greater shareholder value.