In spite of its crashing revenue, the company’s cost of sales is still higher than last year when its revenue was up. The company spent 35.9% more to arrive at N22.7 billion in cost of sales for Q1 2016 compared to N16.7 billion in the same quarter last year.
The group’s net profit for the quarter was NGN13.8 billion compared to N12.3 billion it made within the same quarter last year. For its audited 2015 result, the company recorded improved gross revenue up to N161. 4 billion compared to NGN92.9 billion.
Cost of sales grew to N106.7 billion compared to N49.6 billion it spent in 2014. Its high cost of sales has therefore almost erased its revenue growth. Administrative cost was one of the numbers that jittered analysts last year when Oando recorded its biggest lost in 2014. The company slashed the cost down by 54% to N74 billion compared to the N161.2 billion.
The company has taken drastic steps to clean up its battered balance sheets. Last month, Oando rallied 9 banks to secure N94.6 billion as a five-year Medium Term Note. At the signing ceremony, the company said it would be to meet its financial obligations in the low crude oil price environment.
Sundiata Post investigations show that the crash in global oil price is a dent to balance sheet of major companies including those with little or no link with oil production. Oando’s stock currently trades at N6.69 per share on The Nigerian Stock Exchange, NSE. The stock has fallen by 15% in the last 12 months.