Japaul attributes N22.5bn loss to naira devaluation‎, seeks shareholders support

THE management of Japaul Oil and Maritime Services (JOMS) Plc, in its released the group financial statements for the year ended 31st Dec, 2016 declared a loss after tax of N22.5 billion compared to a loss after tax of N8.9 billion in 2015.

The management in a statement attributed this loss to the challenging operating landscape in 2016, exacerbated by the impact of the Naira devaluation by the CBN, which amounted to foreign exchange losses arising from dollar denominated liabilities and bank loans.

Commenting further, JOMS Plc, explained that the devaluation in the value of the Naira against the US dollar from the CBN closing rate of N196.50:$1.00 in 2015  to N304.5.00:$1.00 in 2016, effectively resulted in significant foreign exchange losses accounting for over 70 per cent of the group’s loss.

Weak economic fundamentals and its pass-through effect on the oil and gas sector with similar impact on the maritime industry further hampered top line growth, leading to poor revenue generation for the company. The group’s revenue which stood at N8.14 billion in 2015 dropped to N3.07 billion in the review period, with gross profit falling significantly to close at a loss of N794.54 million.

The poor performance notwithstanding, the Company reaffirmed that with improved business environment in 2017, the current restructuring efforts within the group, evidenced by the recent sale of its foreign subsidiary and the continued support of shareholders, the fortunes of the company will be transformed.

It further stated that the repositioning initiatives being undertaken, would continue in order to achieve improvements in its underlying asset quality, cost efficiency and enhanced revenue generation across the group.