Oando PLC, Nigeria’s largest indigenous oil company said in its quarterly result that the group recorded a net loss of NGN35,8 billion loss for the third quarter of the year.
While the company’s books shows a very dire outlook, the result is a slight improvement from NGN47,6 billion loss the company reported in third quarter of 2015.
Gross revenue for the period rose to NGN227 billion. This is an improvement over NGN134 billion reported last year.
The major drain in the pipe of the company is its cost of sales, which has skyrocketed to NGN214 billion. Last year, the company reported that it expended a total of NGN99 billion for the same item.
Oando PLC has not being able to put a hold on some of its other key expenditure items. Administrative expenses rose to NGN69,4 billion compared to NGN35,1 billion spent in the previous year.
Oando PLC said it suffered NGN21,5 billion in impairments on its receivables. Last year, it booked a total of NGN23,5 billion on the same item.
Details of the sales is below:
On 18 June 2015, Oando Plc signed a Sale and Purchase Agreement for the disposal of part of its equity interest in some target operating companies of the downstream segment to Copper Energy B.V.
This transaction was concluded in June 2016. Oando Plc also signed another Share Purchase and Sale Agreement (“SPA”) to sell the entire issued share capital of Oando Energy Services Limited (“OES”) to OES Integrated Services Limited (the buyer), a Nigerian company, under a Management Buy-out (MBO) arrangement on 31 December 2015. This was concluded March 31, 2016. In 2015, the Group also signed a Sale and Purchase Agreement for the disposal of 100% of its equity interest in Akute Power Limited to Viathan Engineering Limited.
This transaction was concluded in April 2016. All the completed transactions have been accounted for in these consolidated financial statements. The assets and liabilities of some targeted companies of the Gas and Power division have been presented as held for sale following the approval of the Group’s management and shareholders at the 38th Annual General Meeting (AGM) on 7 December 2015 to sell the entities. The buyer signed a sale and purchase agreement in September 2016.
In December 2015, the Group signed a Sale and Purchase agreement with Nigerian Agip Exploration Limited “NAE” for the sale of its non-operated interests in OMLs 125 and 134. As a result of this, the associated assets and liabilities have been classified as held for sale from December 31, 2015.
Both the sale of Gas and Power and interest in non-operated interests in OMLs 125 and 134 are expected to be completed in 2016 subject to the receipt of consent from the Lenders and the Minister of Petroleum Resources.