OKOMU & PRESCO

The Tale of Two Palm Oil Giants

Nigeria’s two major listed oil producers (OKOMU and PRESCO) recently released their H1 2020 results.

H1 2020 means results for the 6 months of their financial year (January 2020 to June 2020)

Here are a few numbers showing how they both performed.

Revenue

Okomu Oil recorded a revenue of N13.52 billion in H1 2020, a 58% increase compared to the N8.6 billion it recorded in H1 2019.

For Presco, it took a similar pattern. In H1 2020, the firm recorded a revenue of N13.46 billion, 29.8% higher when compared with the revenue of N10.4 billion it recorded in H1 2019.

Operating Profit

Okomu Oil Palm Plc has reported an impressive 100% jump in operating profit from N2.9 billion to N5.8 billion.

What does this mean? It means for every N100 naira Okomu made as revenue; it made an operating profit of about N43.

Likewise, Presco’s operating profit increased by 52%, from N4.4 billion recorded in H1 2019 to N6.6 billion reported in H1 2020. For every N100 of revenue, the firm made an operating profit of N49.

Operating Profit is the figure you get when you subtract administrative, selling and distribution expenses from Gross Profit.

Profit after Tax

For Okomu, a Profit after Tax of N4 billion was recorded in H1 2020. This is a 58% increase when compared to N2.5 billion recorded by the firm in H1 2019.

However, Presco recorded a Profit After Tax of N4.4 billion in H1 2020, a whooping 71% increase when compared with N2.6 billion it recorded in the corresponding period of 2019.

Earnings Per Share
The increase in topline revenue for both firms also led to an increase in Earnings per share.

Okomu’s half year earnings per share increased by 58% from N2.65 in H1 2019 to N4.20 in H1 2020.

Presco also recorded a 69% increase in earnings/share, from N2.59 in H1 2019 to N4.39 in H1 2020

Stock Performance

The two stocks have also outperformed the Nigerian Stock Exchange All Share Index which measures the average price movement of all the stocks on the exchange. The index is down 6.3%. Simply put, on average most stocks have declined by that percentage.

Okomu has gained 43.9% year to date. Presco has however gained marginally less. It is up 8.4% year to date.