Oando announces N74.7BN profit-after-tax for 2023, records 71% increase in turnover

On Friday, May 31, 2023, Oando PLC, Nigeria’s leading indigenous energy solutions provider, posted a N74.7 billon Profit-After-Tax (PAT) in its full-year-ended 2023 unaudited financials.

This profit shows a positive turn in the company’s fortunes in comparison to the preceding year when the company posted a loss after tax.

Within the larger industry context, Oando’s N74.7 billion PAT compares favourably with indigenous peers over the same period under review such as Seplat Energy which recorded N81.330 billion.

Similarly, Total Energies Nigeria posted a PAT of N12.912 billion, while Aradel’s PAT stood at ₦54.2 billion.

Despite what continues to be a challenging business environment and economic headwinds, energy companies like Oando and Seplat amongst others, recorded commendable results.

The year 2023 saw Oando push forward with its growth agenda, recording positive highlights, including the signing of a Sale & Purchase Agreement (SPA) with Italian oil major, Eni, to acquire one of its local subsidiaries, the Nigeria Agip Oil Company Limited (NAOC).

In addition, its clean energy arm, Oando Clean Energy Limited (OCEL) launched its electric mass transit buses in partnership with the Lagos State government, signaling that things are beginning to look up for the indigenous giant.

More significantly the release of the company’s FYE2023 results, albeit unaudited, finally brings the company a step closer to being in line with regulatory requirements for all listed companies. It’s an indicator that by the end of this year the company will be on track with its peers in reporting results thus giving confidence to shareholders and investors on the company’s current state and future.

Although 2023 saw oil and gas companies impacted by spikes in incidences of militancy and sabotage, the company was still able to record a 71 per cent increase in its turnover to N3.4 trillion compared to N1.9 trillion in FYE 2022.

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Over the last four years the company has been consistent in recording a positive incline in turnover. In 2020, it announced a turnover of N477.1 billion, 2021 N803.5 billion, 2022 N2 trillion and more recently in 2023, it made N3.4 trillion in turnover.

Commenting on the results Wale Tinubu, group chief executive, Oando PLC, said: “Despite the persistent pipeline vandalism across the Niger Delta, which continues to dampen crude production, we achieved a profit after tax of N 74.7 billion in 2023 largely driven by increased trading volumes due to our strategic global partnerships and net foreign exchange gains on the group’s foreign currency denominated assets as against losses on our foreign currency denominated liabilities.

“Furthermore, our milestone signing of the Sale and Purchase Agreement with Eni towards the acquisition of 100% of the shares of NAOC Ltd, marked a pivotal moment for our organization and is poised to unlock substantial synergies in the near future. Our focus is now on completing the acquisition and seamlessly integrating operations to deliver exceptional value to our shareholders.”

The country saw a decline in national oil output, precipitated by pipeline vandalism, oil theft and illegal refining. Against this backdrop, Oando’s Upstream operations saw average daily production increase marginally by one per cent to 20,837 boepd in FYE 2023 vs 20,703 boepd in FYE 2022.

These production numbers comprised of oil production at 6,024bbls/day (vs 4,939bbls/day in FYE 2022); natural gas production of 14,572boe/day (vs 15,292boe/day in FYE 2022) and NGL production of 241bbls/MMscf/day (vs 472bbls/MMscf/day in FYE 2022).

In its trading operations, Oando had a marked improvement; recording a 50 per cent increase in traded crude oil volumes of 32.8 million bbls FYE 2023 compared to 21.8 million bbls in FYE 2022 and a 15 per cent decrease in traded refined petroleum products (1,645,535 MT compared to 1,937,833 MT in FYE 2022).

Against the backdrop of these interim results, speaking on the Company’s strategic focus for the future, Wale Tinubu said, “Having weathered the storm of recent years, our latest results provide a foundation for us to consolidate and build for the future.

“With our planned acquisition of NAOC, we are positioned to take full operatorship and drive-up outputs, value and efficiencies. Moreover, our foray into and leadership in clean energy expand our footprint as a fit and proper integrated energy company with our feet firmly planted in today’s realities and the possibilities of the future.”