Oando posts N315.4b revenue
Oando Plc has announced its financial results for the six months ended, June 30, 2019, with a profit-after-tax (PAT) of N7.2 billion. Oando, whose operation was stalled following sanctions by the Securities and Exchange Commission (SEC), weathered the storm to record a six per cent increase in revenue to N315.4 billion from N297.3 billion in comparative period of 2018.
Since its acquisition of ConocoPhillips Nigeria in 2014, Oando has embarked on a proactive drive to significantly reduce its debt and liabilities. The Group reduced its total borrowings for the period by five per cent to N200.7 billion from N210.9 billion in FYE 2018, totalling a 58 per cent reduction in debt since 2014 from N473.3 billion.
Similarly, its upstream business reduced borrowings by 13 per cent to $221.13 million compared to $255.6million in FYE 2018, totalling approximately 72 per cent debt reduction from $801.6 million in 2014. The company further reduced its Reserve Based Lending (RBL) facility by a 99%.
Commenting on the results, Oando’s Group Chief Executive, Adewale Tinubu, said: “Half year 2019 was a positive period for us as we achieved strong top and bottom line earnings despite our overall performance being tempered by a one-off N14 billion charge. Our crude oil and natural gas production grew by 15% and 8% respectively compared to the similar period last year while we also achieved a significant reduction in our RBL facility to approximately $0.4 million from $450 million at inception- a 99% reduction.
“The bad news is not only was it a very expensive transaction then because the price of crude oil was $112 when we closed and by December crude oil prices had dropped to $60 per barrel, one year after the acquisition, crude oil prices had dropped even further to $30 a barrel. You can imagine us signing the largest cheque in our corporate history and immediately after the market doing a complete reverse. This was coupled with being in an era where Niger Delta militancy was on a high, production was severely hampered; we had a large swamp rig operation and pipelines network which were affected”. Today, Oando is in its third year of consecutive profits.”
He added: “Looking ahead, our focus will be on achieving further growth and profitability by delivering on our production growth initiatives through strategic alliances and partnerships.”