Okomu oil, Nigeria’s biggest crude palm oil producer and second-biggest producer of rubber is reaping the benefits of the current rise in palm oil prices due to tight global supplies.
Data sourced from the Nigerian Exchange Group showed export sales provided the drive for a sterling 63.2 per cent growth in revenue to N20.49 billion, just as profit after tax jumped by 80.2 per cent to N9.50 billion in the first three months of the year, from N5.27 billion in the same period last year.
The three-month revenue of N20.49bn is the highest ever quarterly result by the company, says Cordros Research, which attributed the strong sales to the global price hike in crude palm oil price.
“We attribute the growth in revenue to the surge in CPO price (Average CIF Rotterdam CPO price: USD1,569.18/mt in Q1-22 vs USD1,087.18/mt in Q1-21) influenced by the Russia/Ukraine crisis and sustained supply issues in the international market,” Cordros noted in a statement emailed to its clients.
This shows a jump in earnings per share to N9.96, from N5.53, according to an analysis by Cordros Research.
Vetiva Research has the same attribution: “Amid the supply crunch of edible oils, driven by the ongoing Russia-Ukraine crisis, global CPO prices advanced by 32 per cent from an average of $1,344/mt to $1776/mt. The price increase during the period was fuelled by increased demand for CPO due to shortages of cheaper rival edible oils,” it stated in the note to its clients.
Vetiva Research also noted the record-high sales of Okomu Oil, which is reflective of the global surge in palm oil price. The analysts noted stronger demand for edible oil and biofuels, given the consistent rise in the price of crude oil.
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The firm grew its profit by 80 percent to N9.5 billion in 2022 from N5.2 billion in the previous year.
The data further revealed that Okomu oil exceeded its preceding year’s gross profit of N12 billion by 45.7 percent with a gross profit of N17.6 billion in the first three months of 2021.
The agricultural firm also recorded finance income which surged 175 percent to N3.9 million in the first three months of 2022 from N1.4 million in 2021.
Cash flow from operating activities rose to N14.7 billion in March 2022 by 77.3 percent from N8.3 billion in 2021, while its cash and cash equivalents surged 108 percent in the first quarter of 2022 to N23.5 billion from N11.3 billion in the previous year.
In the first quarter of 2022, the company recorded a 23.4 percent decrease in net operating expenses to N3.9 billion from N5 billion in the previous year.
Total comprehensive income of the company in March 2022 totalled N9.5 billion, an 80 percent increase from N5.3 billion in March 2021.
The agri-business recorded an increase in total assets by 95.9 percent to N30.8 billion from N15.8 billion in the comparable periods.
Earnings per share increased to 996 kobo in 2022 from 556 kobo in 2021.
Recall, Indonesian President Joko Widodo in April announced the export ban of all cooking oil and palm oil products, aimed to ensure domestic markets had ample cooking oil supplies following a dramatic increase in prices.
