BusinessDay

Downstream firms see finance costs rise 194% in Q1 2022

Nigeria’s downstream sector has witnessed uncertainty as marketers increased the price of petrol to between N170/litre and N190/litre.

This raised tension across major cities in Africa’s biggest oil-producing country on account of the increase in transportation costs.

Association of Transporters and Distributors of Petroleum Products has asked the Federal government to settle over N500 billion bridging claim of its members or face their wrath.

In March 2022, Nigeria’s downstream firms’ finance costs rose by 194 percent, recording the highest since March 2020.

A BusinessDay analysis of Ardova, Total, Conoil, Eterna, and MRS financial books showed their finance cost amounted to N2.98 billion in March 2022 from N1.01 billion in March 2021.

The breakdown of the downstream firms’ finance costs gave top marks to Ardova(N1.63 billion), Total (N761.6 million), Conoil(N295.3 million), followed by Eterna, MRS with N215.6 million and N79.5 million.

Ardova

Ardova got top marks as the downstream firm with the highest finance cost in the first quarter of this year.

Finance costs jumped 541 percent to N1.63 billion in March 2022, coming from N254.9 million in March 2021.

However, Ardova saw its profit at N193.4 million in March 2022, dropped 83 percent to N1.16 billion in March 2021.

Revenue jumped 50 percent to N62.9 billion, from N41.9 billion in the first three months of 2021.

The cost of sales grew by 49 percent to N57.5 billion in March 2022 from N38.64 billion in March 2021.

Total assets climbed 0.3 percent to N127.28 billion from N126.87 billion in the comparable period.

Distribution expenses jumped to N1.13 billion in March 2022, an 86 percent increase from N607.9 million in March 2021.

Administrative expenses stood at N2.52 billion in March 2022, a 68 percent jump from N1.5 billion in the corresponding period of last year.

The company acquired Enyo Retail and Supply Limited in 2021 making it one of the oil and gas marketing companies with the largest retail network in Nigeria.

Ardova Plc is an indigenous energy group, headquartered in Lagos, Nigeria, with extended operations in Ghana. It operates majorly in the downstream sector of Nigeria’s Oil and Gas industry but has diversified its businesses into other sectors of the energy value chain

Total Energies

Total Energies got second top marks with its finance cost at N761.6 million in March 2022, a huge 330 percent from N177.1 million in the preceding year.

The downstream firm logged a 45 percent increase in profit to N4.36 billion in March 2022, from N3 billion in March 2021.

The firm also recorded a revenue increase of 46 percent to N97.6 billion in the first three months of 2022 from N66.7 billion in the same period of 2021.

The oil company’s cost of sales jumped 50 percent to N83.1 billion in March 2022 from N55.20 billion in March 2021.

Total assets grew 30 percent to N271 billion as against N208.7 billion in the preceding year.

Selling & distribution costs surged to N1.161 billion, compared to N864.4 million in the period under review.

The firm’s administrative expenses saw a rise to N7.56 billion, coming from N7 billion in the preceding year.

Total Nigeria Plc is a marketing and services subsidiary of TotalEnergies; a multinational energy company operating in more than 130 countries and committed to providing sustainable products and services for its customers.

Read also: We haven’t received subsidy payments since 2015 – oil companies

Conoil

Conoil got third top marks with finance cost at N295.3 million in March 2022, 435 percent from N55.2 million in March 2021.

Conoil Plc, a marketer of refined petroleum products in Nigeria, recorded a 31 percent increase in its profit after tax to N557.2 million in the first quarter of 2022 from N423.9 million in the same period of 2021.

However, the oil company’s revenue dropped 21 percent to N26.1 billion from N33 billion in the year under review, while the cost of sales decreased by 24 percent to N23.3 billion from N30.7 billion.

Total assets climbed 2 percent to N55.3 billion in the first quarter of 2022 from N54 billion in the same period in the previous year.

Selling and distribution expenses rose to N519,498 million in March 2022 from N436,286 million in March 2021.

Administrative expenses grew to N1.31 billion against N1.29 billion in the comparable periods.

Conoil Plc is a Nigerian petroleum marketing company involved in the sale of regulated gasoline and kerosene, diesel, aviation fuel, and low pour fuel.

Eterna

Eterna got the fourth top mark with finance cost at N215.6 million, a 25 percent drop from N289.7 million in March 2021.

The downstream firm saw a profit of N877 million in the first quarter of 2022 as against N254 million in the first quarter of 2021.

Revenue surged to N26.82 billion in March 2022 compared to N14.39 billion in March 2021.

Total assets rose by 58 percent to N49.11 billion as against N30.98 billion in the comparable period.

The cost of sales increased to N24.5 billion in Q1 2022 compared to N13 billion in Q1 of the previous year.

Selling and distribution expenses declined to N33 million compared to N37 million in the comparable periods.

General and administrative expenses rose to N1.1 billion from N795 million in the previous year.

Eterna plc manufacture, market and distribute lubricants and chemicals, trade in crude, and operate a network of filling stations.

MRS

MRS got the fifth mark of N79.5 million, dropping 66 percent from N237.8 million in March 2021.

MRS recorded a loss of N41.45 million compared to an N4.8 million profit in the first quarter of the previous year.

Revenue grew by just 3 percent to N17.9 billion in Q1 2022 from N17.3 billion in the comparable periods.

Total Assets dropped 3 percent to N35.97 billion in March 2022 compared to N37.05 billion in the previous year.

The cost of sales jumped to N16.76 billion compared to N16.43 billion in the period under review. Selling and distribution expenses increased to N336 million from N329 million in the previous year.

Administrative expenses also increased to N980.8 million compared to N969.9 million in the period under review.

MRS is one of the largest and leading marketers of refined products, including quality gasoline, marine, and aviation fuels in the downstream industry in Nigeria.

Get real time updates directly on you device, subscribe now.