In its most recent financial statement, Okomu Oil Palm Plc, a significant oil palm production firm in Nigeria, reported a 22% increase in its after-tax profit for 2023.
From N17.33 billion in 2022 to N21.16 billion last year—the greatest profit in at least 13 years—the company’s after-tax earnings increased.
Additionally, it reported a N75 billion turnover, up 26.6 percent from N59.2 billion.
Analysts at Cordros Research stated that “the higher sales print was driven by the effect of the local currency devaluation on crude palm oil (CPO) prices, which triggered an increase in local CPO prices.”
A closer look at the statement reveals that the company’s export sales were N7.95 billion, up 44.7 percent from the year before. Additionally, operating costs rose by 19.7% to N17.29 billion.
The firm, located in Edo, reported an increase in exchange of N762.8 million from N74.6 million.
For the quarter, earnings per share increased to N22.19 from N18.17.
Operating operations’ net cash inflow decreased to N23.22 billion from N25.68 billion.
In contrast to a negative of N11.44 billion, the net cash outflow from investing operations was a negative of N7.39 billion.
After recording a negative of N18.36 billion, net cash inflow/outflow from financing activities improved to a negative of N17.15 billion.
For the period, there was N4.50 billion in cash and cash equivalents, down from N5.84 billion.
According to Cordros Research, favorable factors including upside for Nigerian CPO planters, particularly in the context of foreign exchange availability, will propel Okomu Oil’s toplines.
“We expect continued growth in the company’s earnings in 2024, propelled by favorable factors like the potential for Nigerian CPO planters, particularly in light of the difficulties with foreign exchange liquidity, which we believe will have a positive effect on the company’s earnings,” they stated.
In the Okomu Forest Reserve, the Federal Government established the business in 1976. In 1990, it was made available for public listing on the Nigerian Stock Exchange.
It belongs to the Luxembourg-based Socfinal group, which holds 62.94 percent of the company’s shares; Nigerians have the remaining 37.06 percent.
19,061 hectares of oil palm and 7,335 hectares of rubber plantation are under its ownership.
About 54,091 tonnes of palm oil, 10,353 tonnes of palm kernel, and 8,124 tonnes of dry rubber were produced by the company as of December 2022.
The company’s main endeavors are the establishment of oil palm plantations, palm oil mills, processing palm kernels, and rubber plantation development.
The items include rubber cup lumps, banga (packaging), palm oil, palm kernel oil, and palm kernel cake.