Totalenergies marketing Nigeria Plc has recovered swiftly from its worst revenue and profit numbers in 2020 to record its best revenue and profit figures in years in 2021. This rebound has made the oil marketing company’s story one of the most exciting corporate earnings in 2021.
Its closing figures for the 2021 operations show revenue and profit climbing to new highs. After-tax profit scurried up from N2 billion in the preceding financial year to N16.7 billion at the end of 2021.
This marks a new profit high for the company since its profits declined from the peak of N14.8 billion in 2016.
Also, the company’s sales revenue raced up from N204.7 billion in 2020 – the lowest figure in nine years to hit a new peak at N341 billion in 2021. This is slightly better than our turnover projection of N335 billion for the company for the year.
The growth in sales revenue represents an increase of over N136 billion over the review period. Revenue growth accelerated in the final quarter with an increase of about 87 per cent quarter-on-quarter to N99 billion.
The company’s main revenue line, which is Petroleum products, recovered from a drop of 35 per cent in the preceding year to register a record growth of 62.4 per cent at the end of the year.
Overall, lubricants and other products led to the growth in sales revenue with an increase of nearly 81 per cent. The highest growth record in revenue lines came from other income that recorded an exceptional growth of 330 per cent to close at N4.4 billion for the year.
The company’s management added cost savings from key expense lines to the impressive growth in sales revenue. These include input cost of sales, which moderated relative to sales despite strong growth of 64.5 per cent to N286 billion at the end of the year.
Other favourable changes that helped to enhance profit performance in the final quarter are moderated increases in operating costs and a shift from other losses of N112 million to other income of N814 million quarter-on-quarter.
The cost savings achieved enabled the company to push gross profit by almost 80 per cent to N55 billion in the full year.
There were only moderate increases in operating expenses in the year, which enlarged profit capacity for the company. Operating profit soared from N3.5 billion in 2020 to almost N26 billion in the full year.
The company cut finance expenses with its major slash of 54 per cent in the company’s borrowings to close at less than N15 billion at the end of the year. Finance expenses dropped by nearly 39 per cent to N1.8 billion. The cost reduction was however neutralized by a drop of 63 per cent in finance income to N831 million.
The changes led to an increase of nearly one-half in net finance expenses to N941 million at the end of 2021. Also, tax expenses jumped close to 10 times to claim up to 33 per cent of pre-tax profit in the year.
The company closed the 2021 operations with earnings per share of N49.26, rising from N6.08 per share in the same period in the preceding year.
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