Economy
Drop in Local Sales Shrinks Okomu Oil’s Q3 Turnover, Profit
By Adedapo Adesanya
Okomu Oil Palm Company Plc has released its interim financial statements for the nine months ended September 30, 2019, but performance of the Edo State-based firm was not impressive as there was a slight decline in the profit after tax (PAT) and the turnover when compared with the same period of 2018.
The Q3 results of the palm oil producing company were not too different from what was achieved in the first half of this year as earlier reported by Business Post when they were released then.
The company said its revenue as at September 2019 stood at N15.5 billion compared with N16.7 billion 12 months ago, indicating a shortfall of N1.2 billion or 7.2 percent. This occurred as a result of a 10.3 percent drop in local sales, which closed at N13.1 billion in contrast to N14.6 billion recorded in the same period last year. However, the firm saw an increase in its export sales by 22.6 percent, rising to N2.5 billion from N2.04 billion.
There was also a drop in the cost of sales by the company in the period under review as this marginally went down to N2.2 billion against N2.3 billion in September 2018, just like its net operating expenses increased by over 30 percent to N7.4 billion from N5.6 billion.
The company’s finance income rose to N381.3 million in the first nine months of this year compared with last year’s N307.6 billion, while the finance cost was pruned toN215.0 million from N332.2 million.
It also declared a decline in the gross profit in the considered time, closing at N13.3 billion in September 2019 against N14.4 billion in September 2018.
Despite recording a lower revenue and gross profit in Q3 2019, Okomu Oil paid a higher tax than the previous comparative period in 2018. In the results, the firm said it paid to government the sum of N1.98 billion in taxes in the period under review, higher than N1.48 billion in the same period of last year.
This was because of the N1.894 billion paid as income tax in Q3 2019 against the N1.296 billion paid in Q3 2018. The firm said it paid N93.3 million as education tax this year versus N181.8 million last year.
During the period under consideration, Okomu Oil said in its earnings that its profit before tax dropped to N6.1 billion from N8.7 billion, while the profit after tax went down to N4.1 billion from N7.2 billion. In the financial statements, the earnings per share went down to N4.31 in Q3 2019 from N7.59 in Q3 2018.
Okomu Oil said it closed September 30, 2019 with a total net assets of N29.8 billion compared with N28.5 billion as at September 30, 2018. These assets comprise a share capital of N477.0 million (N477.0 million as at December 2018), N1.9 billion share premium account (same as at December 2018) and revenue reserves of N27.4 billion (N26.2 billion as at December 2018).
By Aduragbemi Omiyale
The Debt Management Office (DMO) on Monday allotted bonds worth N929.3 billion to investors from the N1.7 trillion bids it received from subscribers.
The exercise, which took place on Monday, July 20, 2026, was oversubscribed by market participants, reflecting the confidence investors have in the government’s ability to redeem the debt instrument on maturity.
On offer for sale for the July auction was N1.2 trillion worth of the FGN bonds, but the DMO allotted below this, despite receiving bids above the offer.
The papers were offered in 10-year, 15-year, and 20-year tenors, at N400 billion each.
For the decade-old note, investors staked N444.47 billion, but the debt office sold N245.73 billion at an 18.34 per cent coupon rate. For the one and a half-decade-old paper, bids valued at N518.00 billion were received by the DMO, with a non-competitive bid of N50.00 billion, with N302.13 billion allotted to investors at 18.40 per cent, and for the two-decade paper, the DMO got competitive bids of N665.19 billion and N381.46 billion was sold to bondholders at 18.35 per cent.
By Adedapo Adesanya
The Governor of the Central Bank of Nigeria (CBN), Mr Yemi Cardoso, disclosed that Nigeria’s external reserves had risen to $52.5 billion, enough to finance about nine months of imports.
He disclosed this on Tuesday at the end of the 306th meeting of the Monetary Policy Committee (MPC) held in Abuja, where the Monetary Policy Committee (MPC) retained the benchmark interest rate at 26.50 per cent as well as the standing facilities corridor at +50/-450 basis points around the MPR.
Similarly, the Cash Reserve Requirement (CRR) was maintained at 45 per cent for Deposit Money Banks, 16 per cent for Merchant Banks, and 75 per cent for non-Treasury Single Account (TSA) public sector deposits.
Speaking on FX developments, the central banker said at the $52 billion level, the country’s external reserves were significantly above the internationally recommended threshold of three months of import cover.
On the Naira exchange rate, Mr Cardoso said the foreign exchange market had deepened and was now operating on a transparent willing-buyer, willing-seller basis.
He said the apex bank remained committed to maintaining a liquid and functional foreign exchange market, adding that daily market turnover sometimes exceeded $1 billion.
According to him, the long-term stability of the naira would depend on key economic fundamentals, including increased oil exports, foreign direct investment, and improved domestic productivity to reduce dependence on imports.
He also added that the MPC welcomed the federal government’s renewed commitment to stronger policy coordination, particularly collaboration between fiscal and monetary authorities, which he said had helped reduce the impact of the Middle East crisis on the Nigerian economy.
Mr Cardoso said members of the committee also commended efforts to improve crude oil production and urged relevant agencies to intensify reforms in other sectors, including solid minerals, to boost government revenue.
On the regulatory forbearance granted to banks during the COVID-19 period, he reiterated that this had been discontinued because it had served its purpose.
According to him, the policy had “outlived its time” and was no longer necessary in assessing the health of the banking sector.
“Forbearance, we felt, had outlived its time. Many of you will recall this is something that came as a result of COVID. And now we are in 2026; we did not see the reason why that should continue to form part of the analysis of the banking system,” he said.
Mr Cardoso explained that banks had begun recalibrating their portfolios following the end of the policy, leading to a temporary reduction in outstanding risk assets.
He, however, assured that the development was part of a transition towards a stronger and more sustainable credit environment.
“It reflects a transition to a more sustainable and better quality credit environment, which is what we all want. We don’t want unanticipated shocks that come in a boom-and-bust fashion,” he said.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its recent positive run by 1.17 per cent on Tuesday, July 21, triggered by appreciation seen in four bellwethers.
Leading the pack was FrieslandCampina Wamco Nigeria Plc, which added N12.00 to its value to close at N153.15 per share compared with the previous day’s N141.15 per share. NASD Plc appreciated by N1.90 to N36.00 per unit from N34.10 per unit, Food Concepts Plc improved by 23 Kobo to N2.48 per share from N2.25 per share, and Afriland Properties Plc grew by a marginal 1 Kobo to N15.01 per unit from N15.00 per unit.
As a result, the market capitalisation of the bourse increased by N30.40 billion to N2.637 trillion from Monday’s N2.606 trillion, and the NASD Security Index (NSI) gained 50.70 points to finish at 4,393.97 points, in contrast to the 4,343.27 points it ended a day earlier.
The unlisted securities exchange recorded a price loser yesterday, and it was Geo-Fluids Plc, which shed 1 Kobo to settle at N2.30 per share versus N2.31 per share.
During the trading day, the volume of securities traded by market participants on Tuesday dropped 99.4 per cent to 322,147 units from the previous day’s 52.6 million units, the value of securities dipped by 89.8 per cent to N19.4 million from the preceding session’s N191.2 million, and the number of deals contracted by 3.6 per cent to 27 deals from 28 deals.
Great Nigeria Insurance (GNI) Plc ended the day as the most traded stock by value on a year-to-date basis, with 3.4 billion units traded for N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units transacted for N6.5 billion, and Central Securities Clearing System (CSCS) Plc with 75.4 million units exchanged for N5.3 billion.
GNI Plc also closed the day as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units valued at N6.5 billion, and Resourcery Plc with 1.1 billion units sold for N415.7 million.
