The Nigerian National Petroleum Corporation Limited has declared a profit of N674bn after tax for the year 2021.
The NNPC announced the results today via Twitter.
According to NNPCL, the Board has approved the audited financial statements for 2021. The Group Managing Director, Mele Kyari, was quoted as saying; “NNPCL has progressed to a new performance level, from N287bn profit in 2020 to N674bn profit after tax in 2021, climbing higher by 134.8% year-on-year profit growth.”
During a press conference held in Abuja on October 4, Mele Kyari spoke about the company’s performance. According to him, in 2019, the group rolled out policies and initiatives aimed at reducing costs and mitigating losses so as to entrench transparency and performance excellence across the various functions of the group’s business operations.
He explained further that the policies were fully supported by President Buhari, who doubles as the country’s petroleum minister.
What he said
“Since then, we have begun to see the transformation and impact of these policies. We have recorded significant improvement in our financial performance, over the past three years, from losses to profits.
NNPCL has progressed to a new performance level, from N287bn profit in 2020 to N674bn profit after tax in 2021, climbing higher by 134.8% year-on-year profit growth.
In September 2021, Mr. President approved the obligation of the 2020 audited financials and we declared the profit after tax of N287bn for the first time in 44 years.
Despite our challenging operating environment, we strongly believe that the NNPC has the potential to substantially deliver better value to shareholders.
We have progressed to a new performance level from 287bn in 2020, to 674bn profit after tax in 2021, climbing higher by 134.8%, compared to the year 2020.
The group’s financial position recorded an increase in total assets from 15.86trn in 2020 to 16.27trn in 2021. While total liabilities decreased by 8.3% from 14.68trn in 2020, to 13.46trn in 2021.
Our shareholder position grew to 2.8trn representing 144% year-to-year interest.
The performance would have been greater if the operations in the year under review were free from incessant vandalism.
The optics
Ever since the announcement was made, Nigerians have been expressing mixed feelings. Some have said the figures are doctored and some have requested to see the audited report, showing actual figures. Others have congratulated NNPCL for recording an increase in revenues for the year highlighted.
Reacting to the announcement, oil and gas analyst Dan Kunle told Nairametrics that NNPC Limited is a $500bn company and it is possible for the group to have made an N674bn profit after tax.
He asks; “How are Nigerians sure that this figure is indeed accurate? Are the figures commensurate with the oil and gas assets at the group’s disposal?
According to Kunle, NNPC Limited is no longer government-owned but is now owned by the Nigerian masses, so, the national assembly that constitutes representatives of the Nigerian people, is duty-bound to subject the figures to scrutiny, so everyone can be assured that the figures are indeed correct.
An international oil company (IOC) staff also told Nairametrics that he received the announcement with some skepticism because the oil refineries are still not profitable.
“The refineries have recorded losses in billions over the years. A company that owns refineries that are not doing well cannot convince some of us that those figures are real.”
He went further to say that NNPC Limited is still very much a government-controlled entity and so, transparency is not fully maximized. He believes the announcement is a ruse to try to make the government look good because the administration is wrapping up its tenure by Q2 2023.
In case you missed it
- In August 2021, NNPCL made a declaration of profit after tax of N287 billion in 2020, which was a sequel to the completion of the statutory annual audit exercise for 2020.
- Losses were reduced from N803 billion in 2018 to N1.7 billion in 2019, and there was a declaration of a net profit in 2020 for the first time in its 44-year history.
- Nairametrics had earlier reported that NNPC Limited acquired OVH Energy, to become the biggest downstream company in Africa. Acquired assets include a reception jetty with 240,000 metric tons monthly capacity, 8 liquefied petroleum gas plants, 3 lube blending plants, 3 aviation depots, and 12 warehouses.
