Conoil Plc reported a 54.92 percent increase in revenue from the sale of petroleum products to N87.14 billion in the first half of 2023 from N56.25 billion in the same period of 2022.
Revenue from white products, which include benzene, kerosene, and gasoline, was the highest at N84.28 billion. Revenue from lubricants was N2.86 billion.
Due to the elimination of fuel subsidies and the rise in fuel prices in May, the company recorded an increase in its after-tax profit by 245.3 percent to N6.25 billion in the first half of 2023, up from N1.81 billion in the same period of 2022.
Other operating income
Owing to successive interest rate hikes by the central bank of Nigeria, Conoil recorded a 52.5 percent growth in its interest earnings from bank deposits, reaching N94.26 million in the first half of 2023 compared to N61.8 million in the equivalent period of 2022.
Financial costs climbed to N717.6 million during the first half of 2023, up from N585.1 million reported in the same timeframe of 2022. This increase is attributed to higher interest charges on bank overdrafts due to the interest rate rise.
The company indicated that the need for the overdraft arose due to a delay in the settlement of an outstanding subsidy claim from the federal government, which occurred prior to the removal of the subsidy.
“Bank overdrafts are repayable on demand. The average effective interest rate on bank overdrafts approximates 17 percent (2022: 14.9 percent) per annum and is determined based on NIBOR plus lender’s markup,” Conoil said in its statement.
“The overdraft was necessitated by delay in payment of outstanding subsidy claims from the Federal Government on the importation/purchase of products for resale in line with the provision of Petroleum Support Fund Act for regulated petroleum products,” the company added.
Cash and cash equivalent
Conoil’s total cash and cash equivalents for the period reported a negative balance of N1.42 billion, contrasting with a positive balance of N1.29 billion noted in the same period of 2023.
The company noted that the negative balance primarily resulted from the necessity to invest more in inventory stock in the first half of the year.
Net cash generated or used in operating activities recorded a negative value of N876.5 million in the first half of 2023, compared to N2.57 billion recorded in the corresponding period of 2022.
Meanwhile, net cash used in investing activities wasn’t recorded during the period, differing from a negative value of N927 million in the same period of 2022.
Net cash used in financing activities also incurred a loss of N717.6 million in the first half of the year, increasing from a loss of N585.1 million in the same period of 2022.
Shareholders’ funds showed a growth of 32.49 percent, amounting to N31.27 billion in the first half of 2023, in contrast to N23.6 billion recorded in the equivalent period of 2022.