How Nigeria’s Biggest Palm Oil & Rubber Producer Suffered 52% Profit Decline

Okomo Oil, Nigeria’s largest crude palm oil producer and second-largest producer of rubber, has revealed its third-quarter results for 2022, revealing a 52% decrease in pre-tax profit to N1.1 billion from N2.3 billion in the second quarter.

The financial filings revealed that revenue for the third quarter of 2012 increased by 26.99% to N9.421 billion from N7.419 billion in the third quarter of 2011. Despite the increase in income, the company’s earnings fell sharply by 40% as a result of higher costs brought on by inflation.

Export sales, which made up 10.75% of total revenue, decreased by 46.68% from the previous year. The corporation has not yet given an explanation for why export sales are down.

Revenues through September are up from N31 billion during the same period previous year to N50.1 billion.

Over the past three months, OKOMU has been the 88th most actively traded stock on the NGX, and its share price has fluctuated less wildly.

It started the year with a share price of N142.00 and ended its last trading day (Friday, November 4, 2022) at N169.50 per share on the NGX.

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In terms of year-to-date valuation, Nairametrics resorts this demonstrates that the stock has since increased by 19.4% from that price valuation, placing it 28th on the NGX.

Okomu also  added to the N9.995 billion it began the year with, from which it paid loan interest and loan reimbursement, to produce an additional N22.082 billion in net cash flow from operating activities.

Further, it invested N7.581 billion to purchase real estate, buildings, machinery (including a palm mill), and biological assets. The business ended the quarter with N9.561 billion in cash on hand.