Oando Plc has recorded N8.5 billion profit after tax (PAT) in its half-year ended June 30, 2018 (H1 2018) results.
Coming in the wake of increase in the price of oil and gas commodities, the result marks the company’s seventh consecutive quarter profit.
Following the fall in oil prices, Oando like other companies took a significant hit in its revenues and ultimately reported losses. However, the company has since actively worked toward reversing its fortunes and reminding its shareholders that an investment in the company will indeed pay off.
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An analysis of Oando’s financials shows that the company’s turnover grew by 11 per cent to N297.3 billion from N267 billion (H1 2017); gross profit increased by 53 per cent to N51 billion compared to N33.4 billion (H1 2017); and profit-after-tax increased by 86 per cent to N8.5 billion compared to N4.6 billion (H1 2017). In its upstream business, Oando recorded a net profit of N27.1 billion ($75.2 million) compared with N16.3 billion ($53.2 million) in the comparative period of H1 2017.
According to the company’s statement, the increase in net income between the quarters was primarily due to higher revenues as a result of a general increase in the price of oil and gas commodities. Oando picked up on the industry recovery witnessed in 2017. Brent prices averaged $69.87 per barrel, resulting in a 38 per cent increase in realised crude selling price compared to the same period in 2017. Oando’s performance was further buoyed by sale price increases of 19 per cent for NGL and 13 per cent for natural gas deliveries.
Commenting on the results, Wale Tinubu, Group Chief Executive, Oando Plc said: “I am pleased to report that Oando Plc has made significant progress in 2018, evidenced by our substantial free cash flow generation and profitability.
“Oil prices have rallied over the last year, a direct consequence of increasing demand and reduced supply. Higher oil prices, and the resolution of joint venture funding challenges with the Nigerian National Petroleum Corporation has driven increased investment in the upstream sector. This stable operating environment, coupled with our fiscal prudence, has reinforced our solid financial footing as we continue to build on the momentum garnered in 2017.”
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