BREAKING: Oando declares N44.4bn profit before tax in 2021

After a long wait, Oando Plc has announced N44.4billion profit before tax in 2021 financial ended December 31, as against a loss before tax of N134.28billion reported in financial year ended December 31, 2020.

The indigenous energy company listed on both the Nigerian Exchange Limited (NGX) and Johannesburg Stock Exchange (JSE) announced N32.86billion profit after tax in 2021 from a loss of N140.67billion in 2020.

Key drivers that contributed to Oando’s migration to positive results in 2021 financial year was N803.46billion revenue from contract with customers, an increase of 68.42 per cent from N477.07billion reported in 2020 and N104.93billion reversal of impairment/(impairment of assets) of financial assets, net in 2021 from  a loss of N62.9billion in 2020.

Finance income stood at N44.08billion in 2021, an increase of 376.5 per cent from N9.25billion in 2020, another contributing factor to the group’s profits.

The firm explained that its revenue for the period was positively impacted by high product prices, with realized average crude oil price increasing by 82per cent  ($62.14 per barrel compared to $34.21 per barrel in 2020), natural gas by 38 per cent ($9.96/boe compared to $7.20/boe in 2020), and NGL by 31 per cent ($7.16/boe compared to $5.48/boe in 2020).

“These, in addition to an eight per cent increase in traded crude oil volumes (17,445,256 bbls compared to 16,081,633 bbls in 2020), and a 39 per cent increase in traded refined products (962,370 MT compared to 694,653MT in 2020) contributed to an overall increase in revenue of 68 per cent (N803.5 billion compared to N477.1 billion in the same period in 2020).

“Revenue growth was negatively impacted by a 40 per cent decline in production (26,775 boepd compared to 44,550 boepd in 2020) due to increased sabotage activities,” the firm added.

Commenting on the results, Group Chief Executive, Oando, Wale Tinubu in a statement said, “Our Audited Full Year 2021 Financial Statements are broadly in line with our earlier published Unaudited results in which we announced an increase in profitability driven by a strong revenue performance – a consequence of an 82% increase in average realized oil sale price – coupled with the refund of long-standing receivable.

“Although a surge in militancy and sabotage activities across the Niger Delta negatively affected our operations during the reporting period, we have since seen progress in security initiatives and are consistently seeking innovative solutions to stabilize our oil & gas production.

“Moving forward, we remain committed to driving growth within our upstream and trading businesses, whilst simultaneously diversifying our portfolio by investing in non-fossil and climate friendly energy solutions through Oando Clean Energy Limited.

“We will continue to update our esteemed shareholders as progressive developments are made in the coming year”.

Oando’s announced a total borrowings of N460.8billion in 2021, an increase of 10 per cent from N419.6billion in 2020.