In a bid to meet short-term financial obligations, Nigeria’s downstream firms have increased their short-term borrowings by 41.6 percent in the first half of 2023.
The downstream firms’ short-term borrowings amounted to N122.19 billion in H1 2023 from N86.31 billion in the same period of 2022.
Eterna recorded the highest growth in short-term borrowings which stood at 117.6 percent, Conoil recorded 51.6 percent growth, and Total Energies recorded 16.4 percent growth. However, MRS Oil recorded a decline of 24.2 percent.
Read also: Nigeria’s downstream firms lose 87% of H1 revenue to input costs
Short-term borrowing is a firm’s financial obligations that are expected to be paid off within a year. It is listed under the current liabilities portion of the total liabilities section of a company’s balance sheet.
Firm analysis
Eterna
Eterna recorded the highest short-term borrowings growth of 117.6 percent in the first half of 2023.
The downstream firm’s short-term borrowings amounted to N42.89 billion in H1 2023 from N19.71 billion in the same period of 2022.Total current liabilities grew to N58.34 billion in H1 2023 from N43.03 billion in the similar period of 2022.
Revenue amounted to N69.34 billion from N57.22 billion while the firm recorded a loss after tax of N5.89 billion from a profit after tax of N1.25 billion.
Read also: Downstream firms Q1 results: The good, bad and ugly
Conoil
Conoil recorded 51.6 percent growth in short-term borrowings in the first half of 2023.
The firm’s short-term borrowings amounted to N10.92 billion in H1 2023 from N7.2 billion in the similar period of 2023. Total current liabilities grew to N49.26 billion in H1 2023 from N38.75 billion in the same period of 2022.
Revenue grew to N87.14 billion from N56.25 billion while profit for the period amounted to N6.25 billion from N1.81 billion.
Total Energies
Total Energies short-term borrowings increased by 16.4 percent in the first half of 2023.
The firm’s short-term borrowings grew to N66.97 billion in H1 2023 from N57.54 billion in the same period of 2022.
Total current liabilities jumped to N288.74 billion in H1 2023 from N216.6 billion in the similar period of 2022.
Revenue increased to N274.61 billion from N209.01 billion while profit after tax rose to N8.79 billion from N8.53 billion.
Read also: Downstream firms post 47% revenue growth in aviation fuel despite hurdles
MRS
MRS’ short-term borrowings dropped 24.2 percent in the first half of 2023.
The firm’s short-term borrowings dipped to N1.41 billion in H1 2023 from N1.86 billion in a similar period of 2022.
Total current liabilities increased to N30.18 billion in H1 2023 from N18.26 billion in the same period of 2022.
Revenue increased to N59.65 billion from N42.66 billion while profit after tax increased to N2.31 billion from N351.81 million.
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