Key Highlights
- After delaying the release of its financial reports since 2020, Oando Plc has finally announced financial statements for two years.
- Profit after Tax stood at N34.7 billion in the 2021 year-end, compared to the loss-after-tax of N140.7 billion in FY 2020.
- The oil company had attributed the delay to the lengthy onboarding process required for new external auditors and the complexity of auditing the several companies that make up the Oando Group.
After delaying the release of its financial reports since 2020, Oando Plc has announced financial statements for 2020 and 2021.
The Oil Company reported a turnover of N722.5 billion for the 2021 year-end, up by 51% compared to N477.1 billion reported in the 2020 Financial Year.
This was contained in the company’s 2021 unaudited financial statement released to the Nigerian Exchange Limited and obtained by Nairametrics.
Profit after Tax stood at N34.7 billion in the 2021 year-end, compared to the Loss-after-Tax of N140.7 billion in FYE 2020.
The Profit-After-Tax for FYE 2021 was driven primarily by a higher operating profit, as well as an increase in Finance Income to N44.1 billion compared to N9.3 billion in 2020.
Impacts on revenue
According to the company, revenue for the period was impacted by high product prices, with realized average crude oil price increasing by 105% ($70.12 per barrel compared to $34.21 per barrel in 2020), natural gas by 40% ($9.96/boe compared to $7.13/boe in 2020), and NGL by 27% ($6.98/boe compared to $5.48/boe in 2020).
These, in addition to an 8% increase in traded crude oil volumes (17,445,256 bbls compared to 16,081,633 bbls in 2020), and a 39% increase in traded refined products (962,370 MT compared to 694,653 MT in 2020) contributed to an overall increase in revenue of 51% (N722.5 billion compared to N477.1 billion in the same period in 2020).
Revenue growth was negatively impacted by a 40% decline in production (26,775 boepd compared to 44,550 boepd in 2020) due to increased sabotage activities.
The statement further explained that during the twelve months ended December 31, 2021, average production was 26,775 boe/day, as compared to 44,550 boe/day in 2020.
- “In 2021, production consisted of 8,849 bbls/day of crude oil, 1,699 boe/day of NGLs and 97,363 mcf/day (16,227 boe/day) of natural gas. Production decreases were 42% at OML 60-63, 23% at OML 56 and 1% decrease at OML 13 respectively.
- Production decreases were a result of shut-ins for repairs and maintenance and sabotage incidences at the facilities. During the twelve months to December 31, 2021, the Group incurred $63.4 million on capital expenditures related to the development of oil and gas assets and exploration and evaluation activities, compared to $83 million in the twelve months to December 31, 2020.
- Capital Expenditures in 2021 consisted of $59.2 million at OMLs 60 to 63 incurred on oil and gas properties, $3.3 million at OML 56 and $0.9 million capital expenditure recorded on other assets,” the statement said.
What Oando Plc’s CEO said about its financial reports
Commenting on the 2021 year-end results, the Group Chief Executive Officer of Oando Plc, Wale Tinubu, said:
- “2021 was defined by contrasting themes for Nigerian oil producers, with buoyant oil prices tempered by an increasingly challenging local operating environment. Bullish oil prices throughout the year saw us record a 105% increase in average realized oil sale price whilst a surge in militancy and sabotage across the Niger Delta resulted in a 40% decline in average hydrocarbon production compared to 2020.
- “Despite the challenges, a strong revenue performance, coupled with the refund of a longstanding receivable contributed to a Net Profit of N34.7 billion”.
What you should know
Oando Plc had informed the shareholders and regulators of the delay in the release of the company’s 2020 and 2021 audited financial statements.
According to the notice obtained from the NGX, the financial statements also included the reports for the first, second, and third quarters of 2022.
The oil company attributed the delay to the lengthy onboarding process required for new external auditors and the complexity of auditing the several companies that make up the Oando Group.
- “The board of directors and auditors will be in a position to approve our financial statements in line with the now revised timetable,” the statement said.
The company’s shareholders had earlier approved the 2019 audited financial statements of the company and appointed BDO professional services as new external auditors for the purpose of auditing the company’s 2020 and 2021 audited financial statements.
The new dates, according to the company, slated for the disclosure of 2020 audited financial statements would be in February 2023, while that of 2021 audited financial statements would be in May 2023, with Q1-Q4 2022 unaudited financial statements in June 2023, and 2022 audited financial statements in August 2023.
