Tinubu reacts as Oando Bounces Back to Profitability, Posts N34.7bn Profit
- Oando Plc, an indigenous oil company in Nigeria, has returned to profitability, posting a net profit of N34.7 billion for the 2021 fiscal year.
- The company's CEO, Wale Tinubu, expressed satisfaction with the strong revenue performance despite a challenging operating environment.
- He also affirmed the company's commitment to investing in climate-friendly and bankable energy solutions
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Nigeria's indigenous oil company, Oando Plc, has reported a net profit of N34.7 billion for the 2021 fiscal year.
The positive outcome marks a significant recovery from the N140.7 billion loss after tax recorded in the previous year.
The company also reported a 51% increase in revenue to N722.5 billion in 2021, compared to N477.1 billion in 2020.
The positive financial result comes as welcome news for Oando Plc, which had faced a series of challenges in recent years, including a protracted dispute with the Securities and Exchange Commission (SEC) over corporate governance issues.
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The dispute was resolved in 2020, with the SEC lifting the suspension of Oando's shares on the Nigerian Stock Exchange.
Breakdown of Oando's result
Oando reported a positive financial result, with a profit after tax of N34.7 billion in 2021, compared to a loss after tax of N140.7 billion in the previous year.
The positive result was driven by increased revenue and higher operating profit, among other factors.
Higher product prices played a significant role, with the average realized oil sale price increasing by 105% to $70.12 per barrel, natural gas prices rising by 40% to $9.96/boe, and NGL prices jumping by 27% to $6.98/boe.
The company also reported a net reversal of asset impairments totaling N112.1 billion, which contributed to the improved operating profit of N78.7 billion in 2021, up from an operating loss of N74.3 billion in 2020.
Tinubu speaks on the positive result
Wale Tinubu, the Chief Executive Officer of Oando, commented on the financial result, stating that the company's performance in 2021 was marked by opposing themes for Nigerian oil producers.
While there were favorable oil prices, there was also a difficult local operating environment.
He highlighted that the surge in militancy and sabotage across the Niger Delta led to a 40% decrease in average hydrocarbon production compared to 2020.
However, Tinubu expressed his satisfaction with the company's strong revenue performance, coupled with the refund of a long-standing receivable, contributing to a net profit of N34.7 billion.
He also emphasized the company's commitment to investing in climate-friendly and bankable energy solutions through Oando Clean Energy Limited.
"As we continue to drive the growth of our existing businesses whilst also exploring creative solutions towards curbing the incessant pipeline sabotage incidences that continue to plague our local industry, we are also committed to investing in climate-friendly and bankable energy solutions via Oando Clean Energy Limited, thus expanding our portfolio from oil and gas to include non-fossil energy solutions."
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