Conoil PLC

Conoil targets new income streams, declares N1bn dividend

2010-Oct-12
Conoil Plc has embarked on intensive investments in the core areas of the downstream business, in a renewed effort to boost market share for greater shareholders’ returns. According to the management, the focus of the current initiative is to expand the company’s scope and establish new streams of income to further strengthen its competitive edge.

This was disclosed in a statement by the management which also announced the Board of Directors’ recommendation of N1,040,928,000 dividend in respect of the year ended December 31, 2009. If approved at the company’s forthcoming 40th annual general slated for Ibadan on October 22, the shareholders will be paid N1.50 on every 50 kobo ordinary share, representing 50% increase over what they got in 2008.

Explaining the renewed drive to shore up the company’s bottom-line, the statement said it was aimed at upgrading facilities and building modern infrastructures in depots located in strategic parts of the country, with a view to taking full advantage of the emerging markets in the industry.

One major component of the expansion initiative is the construction of a massive depot in Port Harcourt, Rivers State, which is meant to complement its flagship depot in Apapa, Lagos. Located near the free port zone of Onne, the ultramodern facility, which cost about N12 billion, will provide easy access to fuel imports and ease the current pressure on available jetties and other port infrastructures in Lagos.

Our correspondent gathered that the complex has a storage capacity capable of holding 70,000 metric tonnes of all products namely, Premium Motor Spirit (PMS), Automotive Gas Oil (AGO), ATK (aviation fuel), kerosene and bitumen. The huge storage capacity, it was learnt, would enable the supply of 55 million litres of fuel per day, delivering 300 trucks on a daily basis.

As part of efforts to boost its bottom-line, Conoil has also repositioned its lubricants business, building two additional state-of-the-art oil blending plants in Apapa and another one in Port Harcourt, all of which the management said had pushed up its production capacity significantly. The company is also introducing into the market, a new brand of engine oil called Okada Golden Super which is manufactured specially for 4-stroke motorcycles and tricycles.

On the company’s expansion agenda, a statement issued by the management said: “We are determined to continue to make our shareholders and customers happy. So, we are boosting our product portfolios and logistics, expanding our retail network across the country and revamping the Non Fuel Retail business to boost our income.

The audited financial report submitted to the Nigerian Stock Exchange shows that Conoil posted N3.8 billion profit before tax (PBT) in 2009, an increase of 15 per cent over the N3.3 billion recorded in the previous year. Profit after tax also shot up by 27 per cent, from N1.8 billion in 2008 to N2.3 billion, while its net assets rose from N11.9 billion to N13.5 billion. Earnings per share also moved up to N3.3 from N2.62 in 2008.

Chairman of the company, Dr. Mike Adenuga, had consistently expressed the determination to sustain the culture of efficiency, by making conscious efforts to achieve better execution, especially in the areas of financial discipline as well as marketing and customer management.   Back to news