Menu

Forte Oil, a leading Nigerian petroleum marketing company, has reported that its after-tax profit fell by 50 per cent for the full year ended on December 31st, 2016, according to a report released by the Nigerian Stock Exchange on Tuesday.

The company said its profit fell to N2.89 billion last year compared to N5.79 billion reported in the previous year. The decline in profit resulted from a 20.5 per cent rise in cost of sales and 101 per cent rise in income tax expense.

Notwithstanding the decline in profit, Forte Oil reported that revenue rose by 19 per cent to N148.61 billion from N124.62 billion posted a year earlier owing to improved sales of fuels, lubricants and greases, and power generation.

Forte Oil’s revenue and profit were generally in line with expectations of analysts, according to CardinalStone Partners, a Lagos-based investment advisory firm.

“Forte Oil continues to benefit off increased selling prices following the liberalization of the downstream market,” CardinalStone said in a note to investors. “However, Q4 standalone revenue came in lower than Q3 level – we do not rule out the possible impact of the tight FX liquidity situation on product import volume as well as reduced demand following the price increases.”

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 414 MW 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. Nigerian billionaire, Femi Otedola, owns majority shareholding in Forte Oil.

As markets closed on Tuesday, Forte Oil’s stock fell 3.76 per cent to close at N71.22 per share.