A leading oil palm producer, Presco Plc released its 2021 FY results reporting a profit of N19.32 billion at the end of 2021 representing a 267% increase, year on year. The company’s result is on the back of an inflationary year, where businesses and their consumers have had to deal with the rising cost of goods and services. Hence, consumers have had to pay more for the same number of commodities.
A cursory view of the result reveals the company’s profit was driven by a significant rise in the company’s main business segment, sale of crude and refined products. This segment delivered revenue of N47.40 billion during the period compared to N23.52 billion in the same period last year. Revenue growth from this segment alone was more than doubled at 102% year on year. Presco makes money when it sells its crude and refined oil palm products. The company also makes money from income earned from the sale of its mill by-products and the sale of fresh fruit bunches.
Nairametrics covered the Nigerian macroeconomic environment in 2021 where the prices of commodities and services persistently increased during the period under review, thereby resulting in an average food inflation rate of 20.4% at the end of December 2021.
Amidst the government’s recent border closure law during the period, consumers had to heavily rely on locally produced oil palm products since imports of food and other commodities was hampered due to the closure. Hence, oil producers like Presco and its peer, Okomu Oil were able to benefit from the void, while generating more revenue and making more sales.
What you should know
Presco Plc has declared a dividend of N6.6 billion for the year ended December 2021. Earnings per share for the period was recorded as N19.32, a 267.30% increase compared to N5.26 recorded in 2020. Presco Plc share price closed at N200 and has returned over 127% from year to date.