The indigenous oil company, Oando PLC has registered yet another win with the publication of N4.2 billion profit-after-tax (PAT) in its Q1 2018 results, despite the ongoing SEC-led forensic audit into the affairs of the firm.
Oando has cashed into the favourable micro and macro business environment characterised by an increase in national oil production, exchange rate stability, as well as an increase in global oil prices which averaged $66 per barrel in the first quarter of the year, $3 more than the projected average of $63 for 2018 and 2019.
An analysis of Oando’s financials shows that the company’s turnover grew by 9% to N150.5 billion from N138.4 billion (Q1 2017); gross profit increased by 108%, N27.9 billion compared to N13.4 billion (Q1 2017); and profit-after-tax increased by 145%, N4.2 billion compared to N1.7 billion (Q1 2017).
These numbers are reflective of Oando’s increase in production to 4%, 3.6MMboe (average 39,556 boe/day) from 3.4MMboe (average 38,125 boe/day) in the comparative period of Q1 2017 due to the reopening of the Trans Forcados pipeline.
In its upstream business, Oando recorded a net profit of N8.6 billion ($23.8 million) compared with N5.8 billion ($16.2 million) in the comparative period of Q1 2017.
According to the company’s statement, the increase in net income between the quarters was primarily due to higher revenues as a result of a general increase in the price of oil and gas commodities (Q1 2018: Oil -$65.49/bbl, Gas – $1.54/mcf, NGL – $13.59/boe, compared to Q1 2017: Oil – $51.74/bbl, Gas – $1.39/mcf, NGL-$9.62/boe).
Speaking on the results, Wale Tinubu, Group Chief Executive, Oando said: “Our Q1 performance was characterised by a stable operating environment, continued incline in crude oil prices, and the highest level of compliance by member countries’ of the OPEC Accord.
Considering the background of current industry trends, the Company is committed to maximizing throughput rates to ensure a positive financial performance in the ensuing quarters of 2018.”
Oando isn’t the only company who benefited from the increase in commodity prices and improved operating environment.
Exxon Mobil recorded a 16% increase in profit to $4.65 billion. Seplat declared a N6.2bn profit in the first quarter of 2018 compared to a loss of N5.8billion in comparative period of 2017.
Seplat’s commendable recovery was due largely to undisrupted exports via the TransForcados System (TFS). This is now the third consecutive quarter that the firm is posting profits.
Royal Dutch Shell posted a 42% increase in profits to $5.3 billion, $1.6 billion more than in Q1 2017, and the compnay’s highest earnings since Q3 2014 when oil price averaged $102 per barrel.