As finance costs surged by 2,420 percent, Okomu Oil Palm Plc’s loss in the fourth quarter (Q4) of 2022 widened to N714 million from a loss of N64.5 million in the corresponding period of 2021.
Data obtained from palm oil makers’ financial results available on the Nigerian Exchange Group reveal that finance costs grew to N1.73 billion in the fourth quarter of 2022 from N68.56 million in the same period of 2021, with interest on long-term loans and exchange loss accounting for N1.02 billion and N748 million of the total finance costs respectively.
The result of the above developments showed the palm oil maker reported a loss despite revenue growing by 42.83 percent to N9.07 billion in the fourth quarter of 2022 from N6.35 billion in the fourth quarter of 2021, driven largely by revenue growth in the local market which accounted for 82 percent of total revenue generated.
On a quarterly basis, revenue declined by 3.72 percent from N9.42 billion in the third quarter of 2022.
The cost of sales reported by the palm oil maker claimed 59.43 percent of the total revenue for the period, 7,443 percent down from when the cost of sales claimed all of the company’s revenue, accounting for 133.86 percent in the fourth quarter of 2021.
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Despite rising inflation and energy costs, the cost of sales declined by 36.59 percent to N5.39 billion in the fourth quarter of 20222 from N8.50 billion in the same quarter of 2021.
On a quarterly basis, the cost of sales was also down by 14.19 percent from N4.72 billion reported in the third quarter of 2022.
Consequently, the loss margin widened by 685 basis points to 7.87 percent in the fourth quarter of 2022 from a loss margin of 1.02 percent in the corresponding period of 2021.
On a quarterly basis, Okomu moved from a profit margin of 12.85 percent in the third quarter of 2022 to a loss margin in the fourth quarter of 2022.
Net operating expenses increased by 8.65 percent to N3.77 billion in the fourth quarter of 2022 from N3.47 billion in the fourth quarter of 2021.
Okomu Oil reported an exchange gain of N23 million in the fourth quarter of 2022 despite the foreign exchange volatility, and other finance income of N100 million, thereby bringing total finance income for the period to N123 million, 151.02 percent up from N48.9 million in the fourth quarter of 2021.
Overall, the palm oil maker reported earnings per share of N-0.75 per share in the fourth quarter of 2022 from N-0.07 per share in the fourth quarter of 2021.
