Oando Plc has released its financial results for the year ending December 31, 2023, reporting a Profit After Tax (PAT) of N60.27 billion. This marks a major turnaround from the previous year’s N81.23 billion loss, driven by strong revenue growth and significant foreign exchange gains.
Strong Revenue Growth Despite High Costs
According to the Group’s audited financial statement, Oando’s revenue increased by 43% year-over-year (YoY), rising from N1.99 trillion in 2022 to N2.84 trillion in 2023. This growth was offset by a high cost of sales, which absorbed 97% of revenues, increasing by 45% to N2.76 trillion.
Key Financial Highlights
- Revenue: N2.84 trillion (+43% YoY)
- Cost of Sales: N2.76 trillion (+45% YoY)
- Gross Profit: N85.02 billion (+8% YoY)
- Operating Profit: N218.3 billion (+961% YoY)
- Finance Cost: N133.38 billion (+37% YoY)
- Profit Before Tax: N102.97 billion (+267% YoY)
- Income Tax Expense: N42.7 billion (+120% YoY)
- Net Profit: N60.27 billion (+174% YoY)
Major Boost from Foreign Exchange Gains
A notable factor in Oando’s profitability was a sharp increase in other operating income, which soared by 1,304% to N399.98 billion, primarily due to foreign exchange gains totaling N388.02 billion—a result of Naira depreciation in 2023. This substantial increase provided a significant uplift to overall profits despite rising administrative costs.
Production Increases and CEO’s Comments
Oando’s average daily production rose by 12% to 23,258 barrels of oil equivalent per day (boe/day), with crude oil production increasing by 26% and natural gas production by 10%. Chief Executive Officer Wale Tinubu credited the company’s profit to robust global trading alliances and foreign exchange gains, despite challenges from security issues and pipeline vandalism.
Source: Nairametrices