MOBIL OIL: 2015 NOT THAT TOUGH.

For Mobil oil PLC, 2015 did not quite make out to be the tough year on the lips of all even though core income decreased by 19.3%.
According to the year's audited results released recently, the goodness in the year stemmed from far higher drops in three major costs: cost of sale, other operating expenses and finance charges.
Mobil oil had recorded revenue drop from N79583.7m to N64220.9m but direct cost of producing the goods sold dropped at a faster rate by 22.7% from N68846.4m to N53229.8m.
However, the decline in other operating costs at 84.1%, was more remarkable. It ended the year at N23.4m compared to N147.5m for .2014.
Then there was  also the relief got as finance charges went down by 33.9% to N123.1m from N186.1m.
However, selling and distribution and administration expenses refused to bow. In particular, administration expenses increased by 49.6% to N3166.1m from N2116.6m while selling and distribution costs rose by 5.57% to N5517.6m from N5226.5m.
The forces balanced off in the end, and so, from a 16.5% decrease in total income to N68965.3m from N82593.9m, Mobil Oil's profit before tax went down 18.2% from N8446.1m in 2014 to N6956.3m.
Not bad because the profit margin thus recorded, at 10% was only marginally down on 2014's 10.6%.
Besides, Mobil Oil remains strong in terms of liquidity  with working capital increasing to N39791.6m from N32884.5m. and cash position at N3218.2m was considerably up on only N411.4m previously.
SO:
* No doubt, 2015 could have ended even better if Mobil oil had paid attention to administration and selling expenses.
* By the way, with such great improvement in cash and liquidity how come finance income almost dried up going down 53.3% to N74.1m from N158.6m?

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