In spite of a 25 per cent decline in turnover to N31.8 billion during the half year (H1) ending June 30, 2015 as against the 9 per cent gained at N42.2 billion in the same prior in 2014, Mobil Oil Nigeria Plc had succeeded in stabilising its liquidity level.
The H1 result of Mobil Oil, a major oil marketing company showed that cost of sales declined from 8 per cent gained in the previous year to N25.9 billion a 29 per cent or N10.7 billion decrease from N36.6 billion recorded for H1 2014.
While profit before tax dropped 33.18 per cent or N2.04 billion to close N4.1 billion from N6.2 billion, profit after tax weakened by 39.57 per cent or N1.91 million to N2.9 million from N4.8 billion.
Amidst the declining parameters is a 305 per cent growth of the company’s net cash generated from operating activities to N5.83 billion, a better performance from the prior’s period 68 per cent decline to N1.4 billion from N4.5 billion recorded for the same period of 2013.
This depicted higher liquidity levels as current ratio for the period under review grew to 0.88 from 0.75 recorded in the same period of 2014.
An 848 per cent increase of cash from investing activities to N2.7 billion from N284.6 million indicated heavy purchase of capital assets and securities by the group, while cash flow from financing activities grew 69 per cent to N3.4 billion from N2.1 billion recorded in H1 2014.
Return on Assets stood at 6 per cent a little above the industry 5 per cent average, while Gross Margin grew to 18.8 per cent from 13.2 per cent showing cost efficiency but the company’s need of better management in administration and distribution as operating profit and net margin fell 2 per cent to 12.92 per cent from 14.6 per cent and 9.1 per cent from 11.4 per cent respectively achieved in H1 2014.
Cash and its equivalent recorded a net decrease of 62 per cent to N342.8 million from N901.05 million allowing for increased certainty in meeting debt obligations given the sector’s larger level of debt.
Mobil Oil Nigeria Plc has maintained a share value of N151.20 in its last three trading sessions while 9,719 shares valued at N1.5 million were transacted on Wednesday August 19, 2015.
By Pita Ochai