Forte Oil earnings grow on improved sales margins

19 Apr 2017
Financial Nigeria


The company said after-tax profit rose to N1.88 billion in Q1 2017.

Femi Otedola, Chairman, Forte Oil Plc

Forte Oil, a leading oil and gas company, has reported that its 2017 first quarter after-tax profit rose 98 per cent owing to improved profit margins and cost-cutting. The company said its after-tax profit rose to N1.88 billion in Q1, compared with N954.2 million posted in a similar quarter of last year.

The profit growth was supported by a 13 per cent decline in cost of sales and a marginal increase in finance income.

The company’s revenue, however, fell 7.3 per cent to N33 billion in the period under review, compared with N35.6 billion in a similar period of last year. A breakdown of Forte Oil’s revenue shows that sales of fuels fell 24 per cent to N22.77 billion, while sales of production chemicals fell 11.2 per cent to N468.4 million. Notwithstanding, sales of lubricants and greases rose 50 per cent to N3.23 billion, while revenue from power generation rose 119 per cent to N6.53 billion due to capacity utilization and pricing.

Forte Oil’s revenue and profit outperformed analysts’ estimates, according to CardinalStone Partners, a Lagos-based investment advisory firm.

Forte Oil, formerly African Petroleum (AP), operates over 500 fuel service stations across Nigeria. The company also controls Amperion Power Distribution Company Limited, the owner of the 414MW Geregu Power Plant located in Kogi State. In September 2015, Mercuria Energy Group, a Swiss oil and gas commodity-trading giant, acquired 17 per cent equity in Forte Oil for $200 million. Femi Otedola, a Nigerian business mogul, owns majority shareholding in Forte Oil.

The company’s stock rose 1.14 per cent to N44.5 per share as of 1.32pm at the Lagos bourse on Wednesday.

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