Four downstream firms pay income tax of N2.5 bn in Q1

Data gleaned from the Nigerian Exchange Limited (NGX) has shown how four firms operating in Nigeria’s downstream sector paid a total sum of N2.56 billion in the first three months of 2022.

In an industry used to the highs and lows of economic and commodity price cycles, 2022 poses one of the greatest challenges to oil and gas companies.

Nigerians, especially those living in Abuja and Lagos and adjoining states, suddenly woke up in February and found themselves in the middle of petrol scarcity and the usual sufferings at fuel stations that come with it.

The process of recalling the tainted batch led to fuel scarcity and the consequent hike in prices and distrust from the public.

Despite these challenges, the combined income tax paid by Total Energies, Conoil, Eterna, and MRS increased by 47 percent to N2.56 billion in the first three months 2022, coming from N1.74 billion in the first three months 2021.

Income tax is deducted from the profit before tax to give the actual profit for the period, hence a higher tax will reduce the downstream sector’s profit for the year.

The top four quoted downstream firms are Total Energies, Conoil, Eterna and MRS with income tax at N2.18 billion, N185.7 million, N134.1 million and N56.2 million respectively.

Total Energies

Total Energies paid the highest income tax paid in the first three months 2022 compared to its peers, which is also its highest in five years. Income tax jumps 58 percent to reach N2.18 billion in March 2022, from N1.38 billion in March 2021.

In five years, the downstream sector recorded the highest in March 2022.

Income tax jumped to N210 million in March 2020 compared to N55.8 million in the preceding year.

Conoil

Conoil ranked second with its income tax at N185.7 million in March 2022, 7 percent decrease from N199.5 million in March 2021.

The downstream firm’s income tax stood at N122.53 million in Q1’2020 from N153.03 million in Q1’2019. Conoil recorded the least income tax of N43 million in March 2018.

Eterna

Eterna ranked third with income tax at N134 million in March 2022, 11.6 percent increase from N120 million in the same period last year.

The downstream sector paid N84.2 million in 2020, the least income tax paid in five years. Income tax stood at N161 million in March 2019 compared to N240.4 million in March 2018.

MRS

MRS recorded the least income tax compared to its peers which stood at N56 million, a 27 percent increase from N44 million in the year-ago period. The income tax for 2019 and 2020 was unavailable in its financials.

The downstream firm income tax dropped to N197.64 million in 2018 from N245.16 million in 2017.