THE CORN IN CON OIL PLC Q1

In the first quarter to March 2017, the most remarkable thing about Con Oil PLC was the fact that it closed clear of the loss league.

According to the interim figures for the period released last week, by the end of the quarter Con oil recorded 118.9% bounce back to report N173.5m profit before tax compared to N255.1m loss at the same time in 2016.

This was because it had so many things going for it major among which was the fact pump price of petrol went up official and white products, its main stay were relatively more available.

Driven by 29.2% increase in revenue from white products (PMS, Aviation fuel, Kerosine etc) to N23,465.4m, core revenue increased by 28.5% to N23474.3m.

Even though, 33.5% drop in other income to N30.9m depressed total income growth to 28.4% at N24,505.2m, cost of sale lower % growth by 24% to N21,155.8m helped gross profit to increase by 67.6% to N3218.5m.

That was indeed a good foundation to build on and that was where other factors came in handy. First, better control led to 28.1% decline in distribution cost to N470.5m then, secondly, finance charges decreased by 10.4% to N445.4m.

Administration cost posed a greater challenge but it still recorded lower than total income. It increased by 25.5% to N2178.4m.

In the end, because none of these outflows of resources grew faster than income inflow, the result was the seasonal corn now visible in Con Oil PLC by the end of the quarter.

So, the company looks enroute profitable operations in 2017 provided volume and margin in white products hold till the end and provided far heathiee liquidity position is sustained or better still, deployed in a new income stream that could hold the forte when petroleum downstream gets shaky.

CON OIL PLC Nm Q1
                          2017.           2016
Total income 24,505.2.     19,088.9
Core revenue 24,474.3.    19,042.4
Cost of sale.    21,155.8.     17,062.5
Gross profit.     3,318.5.       1979.9
Other income        30.9            46.5
Distribution cost 470.5.          654.2
Administration. 2,178.4.      1735.7
Finance cost          445.4.         497.1
Profit before tax. 255.1.       (860.6)
Profit margin %     1.04.        (4.51)
Working capital  14,044.9.  13,686.7
Cash on hand      50,050.2.   42,295.4

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