Conoil PLC

Conoil Targets 65% Increase Over 2010 Profit

2011-Nov-22
Shareholders of Conoil Plc are in for bountiful returns going by the consistency in its returns to the Nigerian Stock Exchange (NSE) since the beginning of the current financial year.

There are also indications that the company will end the year with an increase of 65 percent profit over its last year’s full result.
Its unaudited third quarter result recently submitted to the floor of the NSE, showed significant increase of 78 percent in its Profit Before Tax (PBT) from N2.6 billion in 2010 to N4.6 billion in 2011.

Conoil also posted 78 percent increase in Profit After Tax (PAT) from N1.7 billion in 2010 to N3.1 billion in 2011, while it recorded Turnover of N120.3 billion in 2011 from N64.8 billion in 2010, representing a whopping 86 percent increase.

Industry analysts are of the opinion that the company might surpass the N6.5 billion full year profit forecast, considering the fact the last quarter is usually the busiest in terms of business activities in the downstream sector of the petroleum industry.

"The performance is very much in line with the commitment of our Board and Management to deliver superior shareholder value at all times," a company official said.

A recent in-depth market analysis by a capital market operator, Apel Asset and Trust Limited, had submitted that Conoil’s stock price was grossly under-valued. It further advised discerning investors to take advantage of the company’s prevailing low share price and invest in its stocks for possible bountiful harvest in the nearest future.

The current performance is coming on the heels of the company’s last two quarters results. While the first quarter result showed 714 per cent jump in profit before tax from N214million in 2010 to N1.3 billion in 2011 and a sharp increase in profit after tax from N145.7million in 2010 to N1.2 billion in 2011, its second quarter recorded 98 percent increase in profit after tax from N1.21 billion in 2010 to N2.4 billion in 2011. Profit before tax also rose from N1.8billion to N3.5 billion, representing 97per cent increase.

The Chairman of Conoil Plc, Dr. Mike Adenuga, while previewing the company’s performance for 2011 at its last annual general meeting, predicted that the company would record triple growth rate and deliver superior shareholder value. "We have set for ourselves, some very challenging targets; but given the commitment of our people and the burning desire to go the extra mile and be the best, we feel confident that 2011 will be a greater success," he had pledged.

A statement by the management of the company said the foundation for the impressive performance, was hinged on the huge investment it committed to the expansion of its businesses, the general overhaul of its facilities and equipment, the optimization of its resources and total elimination of waste in its operations.
One major component of its expansion initiatives was the massive investment in its depot in Port Harcourt to ease fuel scarcity in the southern and northern parts of the country. Touted as the first of its kind in that part of the country, the depot has immense storage capacity for all petroleum products which has added value to Federal Government’s effort at ensuring fuel availability country-wide.

Conoil has also launched itself as a frontline producer and distributor of Liquefied Petroleum Gas (LPG), which is fast becoming a major source of industrial and domestic cooking fuel, with its multi-million naira state-of-the-art LPG bottling plant located in Ikeja, Lagos. The plant has the capacity to bottle 5,000 cylinders a day, to boost supply of cooking gas in the country.

The company has also consolidated its dominance of the high margin business of lubricants in the downstream sector of the industry with additional state-of-the art blending plants in Apapa and Port Harcourt which had pushed up its production capacity significantly.

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