Total Nigeria Plc recorded N500.12 million as Profit After Tax in Q3 2020, against the N204.84 million loss it suffered in the corresponding period last year – a 344% increase.
The information is contained in a recent disclosure sent to the Nigerian Stock Exchange Market today.
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In addition, it also recorded an 881% rise in Profit Before Tax (PBT) for the period under view, as PBT increased to N912.89 million, against N116.95 million loss recorded in the corresponding period last year.
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On the contrary, revenue during the period under view declined by 32%, from N221.84 billion recorded in Q3 2019 to N151.71 billion in Q3 2020.
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What this means
The reason for the mixed result in terms of the dip in revenue and a non-corresponding increase in profit is largely due to a drastic reduction in costs. This simply means that the firm was able to manage its costs very well despite recording lower revenue.
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For example, the firm was able to do the following:
- Reduce its cost of sales to about N66.06 billion, from N196.74 billion as of Q3 2019 to N130.68 billion in Q3 2020 – indicating a 33.6% reduction.
- Reduce its finance cost by 58.25% and increase its finance income by 664.3%.
- The number of staff also reduced by 6%, hence impacting administrative costs.
- Interest on bank loans and overdraft remarkably declined by approximately 64.0%.
- On the flip side, the impact of the lockdown period, due to the spread of the pandemic, affected the revenue of the firm, which may have accounted for the 32% dip in revenue for the period under view.
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