With N132.57bn loss in 2020, Oando reports worst performance on NGX
Oando plc on Wednesday reported N132.57billion loss in its 2020 unaudited account for the period ended December 31, 2020 as against N207.08billion reported in prior year.
The unaudited account released on the Nigerian Exchange Limited (NGX) is the worst performance by a listed company.
According to the company, the loss after tax for 2020 of N132.6 billion was driven primarily by the above asset impairments of N84.7 billion, as well as a 45per cent increase in net finance costs to N58.9 billion compared to N40.7 billion in 2019.
Revenue also dropped by 15 per cent to N489.99billion in 2020 from N576.57billion in 2019, directly impacted by volatile product prices due to the global economic impact of the pandemic, with realized average crude oil price declining by 45per cent ($34.21 per barrel compared to $62.59 per barrel in 2019), natural gas by 24% ($7.13/boe compared to $9.37/boe in 2019), and NGL by 20% ($5.48/boe compared to $6.84/boe in 2019).
The company in a statement said: “These contributed to an overall decline in revenue of 15% (N490.0 billion compared to N576.6 billion in the same period in 2019) despite a five per cent increase in production (44,550 boepd compared to 42,492 boepd in 2019), a 13per cent increase in traded crude oil volumes (16,081,633 bbls compared to 14,173,691 bbls in 2019), and a 53per cent increase in traded refined products (694,653 MT compared to 452,919 MT in 2019).”
The indigenous petroleum marketing company reported a total borrowings of about 16 per cent increase to N419.6 billion in 2020 from N362.2 billion in 2019 due to the financing of the settlement of the protracted shareholder dispute as stated above.
Commenting on the results, Group Chief Executive, Oando Plc, Wale Tinubu in a statement said: “2020 proved to be an unprecedented year for the global economy due to the impact of the novel COVID-19 pandemic.
“The Oil & Gas industry was no exception as the year turned out to be one of the most challenging years in its history as we witnessed the lowest oil prices since our sojourn into Nigeria’s upstream sector in 2008, thus negatively impacting our revenue during the period.
“This resulted in us having to impair a portion of the goodwill on our balance sheet to ensure the carrying value of our assets was a true reflection of the environment we were operating in.
“Furthermore, the second tranche funding of the settlement of a protracted and disruptive shareholder issue resulted in us taking a further impairment on a category of our financial and non-financial assets.
“Despite these challenges, our hedging policy and long-term offtake contracts ensured our cash flows were not severely stressed during this period.
“Amid an uncertain operating environment, our operational performance remained on track as we grew our upstream production by five per cent whilst downstream traded volumes of crude oil and refined products ramped up by 13per cent and 53per cent respectively”.
