Naira Devaluation Triggers Currency Loss, as Seplat Energy Posts $85m Profit in 6 Months

• Seplat Energy has released its financial statement showing an $85 million profit in the first half of 2023
• The company’s profit in the first half is 59.3% less than the amount in the same period the previous year
• Naira devaluation among other factors impacted the company's profit for the period

Despite improving revenue by 3.8% to $547.0 million, Seplat Energy posted $85 million profit in the first half of 2023.

The amount shows a 59.3% decline in profit before tax despite an increase in revenue for the period compared to the $209.9 which it reported in the first six months of 2022.

The company in its financial statement filed to the exchange and seen by Legit.ng admits that operating profits in the period were impacted by lower oil prices and other items, most notably the non-cash impact of the devaluation of the Nigerian Naira.

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Recall that Legit.ng reported that the apex bank on Wednesday, June 14, 2023, announced that all forex transactions shall now be done through the Investors and Exporters (I&E) window, thereby abolishing the country's parallel and other forex markets.

Impact of naira devaluation

The company stated that the President Bola Tinubu’s reforms have been well received by the capital market, as they are crucial to restoring investor confidence in Nigeria's economy. It added that the unified exchange rate system promotes transparency and market-driven exchange rates, fostering macroeconomic stability and growth.

However, it added that the;

“devaluation of the Naira has implications for our business, leading to currency losses on naira cash balances and receivables and resulting in gains on payables balances.”

Balance sheet remains strong despite impact

Commenting on the financial performance by the company, Roger Brown, Chief Executive Officer, said the company’s strong performance puts it on track for an excellent year that will support the increased quarterly dividends announced in April, adding that it balance sheet remains strong despite the impact of the recent Naira devaluation.

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We are benefiting greatly from use of the new Amukpe-Escravos Pipeline, which has supported our robust cash generation this year, and remain focused on improving operations, reducing costs where possible and further derisking the business.

We continue to strengthen our Company in the knowledge that our efforts to improve governance and sustainability are widely supported by Nigerian and international investors.

Brown also expressed confidence that the proposed and transformational acquisition of MPNU will be approved, enabling the company to scale into a significant energy supplier with diverse and productive assets that have potential to generate substantial benefits for Nigeria

First Bank Records N137bn Profit in 3 Months

Legit.ng earlier reported that FBN Holdings, the parent company of First Bank of Nigeria has recorded a profit after tax of N137.12 billion in the second quarter (Q2) of 2023.

This represents a massive 468.14% increase when compared to the profit after tax of N24.13 billion recorded in the corresponding period of 2022.

Source: Legit.ng