Conoil, a listed oil and gas company, has announced a 53.9 percent increase in its profit for the first quarter of 2019. This increase pushed the company’s net profit to the highest level in the last five years.
The company on Wednesday reported that it made N325.18 million as profit in the first quarter, up from N211.295 million made a year earlier. The increase was driven by improvements in Conoil’s revenue and cost management.
In the quarter, Conoil recorded revenue of N35.64 billion from the sales of petroleum products, representing 13.8 percent more than the oil company made in the corresponding period of 2018.
Conoil makes its revenue from three segments namely; White products, Lubricants and Liquefied Petroleum Gas (LPG).
White products segment involves the sale of Premium Motor Spirit(PMS), Aviation Turbine Kerosene (ATK), Dual Purpose Kerosene (DPK), Low-pour Fuel Oil (LPFO) and Automotive Gasoline/grease Oil (AGO). In Q1, White products contributed 95 percent to revenue while Lubricants accounted for the other 5 percent.
Despite the double digit growth in revenue, cost of sales rose 15 percent to N32.68 billion paring Conoil’s gross profit in the quarter. As a result, top-line shrunk to N2.96 billion, down from N3.06 billion in Q1 2018.
Conoil’s other operating income fell to N30.9 million, 68 percent less than N96.42 million previously earned.
However, the oil and gas company was able to reduce its cost in the period which translated to improved earnings. In the period, distribution expenses fell by 31 percent and the company was able to cut down administrative expenses by 7 percent, while finance cost declined some 4 percent.
Consequently, Conoil was able to post a profit before tax of N478.202 million in Q1 2019 as against N310.730 million in the same period of 2018. The company made a profit of N325.18 million while its tax expenses rose 53.9 percent to N153.03 million.
On the back of its improved performance, earnings per share rose to 47 kobo in Q1 2019, from 30 kobo in Q1 2018 while Net asset per share rose to N26.76 from N26.09.
Meanwhile, Conoil shed 9.93 percent on Wednesday to close at N19.95 per share. The company’s share has fallen by 14.19 percent so far in 2019. Conoil markets refined petroleum products in Nigeria. The Company also manufactures and distributes lubricants and chemicals.