H1: Oando records N4.6b profit amidst low oil prices

Oando PLC, Nigeria’s leading oil and gas company further bolstered confidence in the sector by declaring a N4.6 billion Profit-After-Tax in its half year ended 30 June, 2017 results.

An analysis of the half-year (H1) 2017 results reveals a steady increase in earnings.

A comparative review of Oando’s financials further show positive performance across all financial indices, turnover increased by 26 per cent to N267.1 billion from N212.3 billion, gross profit increased by 76 per cent to N33.4 billion from N19 billion.

Net finance costs more than halved to N16.4 billion from N35.3 billion while profit-after-tax increased by 117 per cent to N4.6 billion from 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.

Commenting on the company’s financials, Mr Wale Tinubu, Group Chief Executive, Oando PLC 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.”

Speaking on the outlook for the company in the second half of 2017, Wale Tinubu said, “We remain committed to optimizing our overall production base, seeking unique profit-driven opportunities to further partner with IOCs, while firming up our balance sheet to provide greater shareholder value,” he said.

The Nigerian oil and gas sector is gradually recovering from the upheaval of low oil prices; this is due in part to the exemption of Nigeria from the global oil production cut by the Organisation of the Petroleum Exporting Countries (OPEC) as well as containment of the Niger Delta unrest which has led to a steady rise in oil production.  In May 2017, the country’s oil production increased by 273,600 barrels per day (bpd) to 1.484 million barrels per day (bpd), a testament to these changes.

The approval of the Petroleum Industry Governance and Institutional Framework Bill (PIGB) is set to further improve the sector. The anticipated fall out of the PIGB is more efficiently regulated oil and gas industry and a conducive business environment for sector players. More recently, specifically Thursday, July 27 three petroleum industry bills passed second reading in the Senate; this is expected to further encourage substantial investment in the petroleum industry.