₦airaland Forum

Oando Q4 2024 Financial Performance: A Year of Growth Amidst Challenges


Oando has released its unaudited financial statements for the year ending December 31, 2024, showing a mixed performance driven by substantial revenue growth but impacted by rising costs and increased finance expenses. Despite the challenges, the company’s revenue surge and its strategic business moves provide a fascinating glimpse into its resilience and future potential.

Oando’s total revenue for 2024 soared to N4.12 trillion, up from N2.85 trillion in 2023, representing an impressive 45% increase. This remarkable growth was primarily fueled by a significant rise in sales volumes, which climbed to N3.84 trillion from N2.76 trillion. The growth in sales volumes points to increased demand for Oando's products and services, highlighting the company's ability to tap into a growing market amidst tough economic conditions. The increase in revenue is a strong indicator of the company’s operational strength and the effectiveness of its sales strategies.

A key highlight of Oando’s 2024 performance was its substantial improvement in gross profit, which surged from N85 billion in 2023 to N282.5 billion. This nearly threefold increase emphasises the company's ability to manage its production and operational costs efficiently, despite the inflationary pressures and rising global prices affecting the oil and gas sector. The growth in gross profit demonstrates Oando’s strong operational management and its capacity to retain a solid portion of its earnings amid higher expenses.

While Oando experienced growth in core business revenues, its other income—earned from non-core business activities—saw a decline, dropping from N399.9 billion in 2023 to N349.7 billion in 2024. Although the company earned less from non-core activities, this decline was somewhat offset by its robust performance in its main operations.

However, the company’s operating income, a measure of its core business profitability, saw a marginal increase to N220.2 billion from N218.3 billion. This rise can be attributed to higher revenues, though it also reflects the company’s increased expenditures. Operating expenses climbed in 2024, driven by inflation, expansion efforts, and rising administrative costs, including higher salaries and office-related expenses.

In 2024, Oando's finance costs ballooned to N173.6 billion, up from N116.4 billion in the previous year. This surge was largely due to higher interest payments on debt, a reflection of the company’s financing strategies and the global interest rate environment. On the other hand, Oando also experienced a positive rise in finance income, which grew from N16.8 billion in 2023 to N58.4 billion in 2024. While this helped offset some of the rising finance costs, it wasn’t enough to shield the company from the overall financial pressures.

Despite the revenue growth, Oando’s profit before tax (PBT) dropped significantly in 2024, falling to N47.7 billion from N102.9 billion in 2023. This decline in pre-tax profits indicates that the increase in revenue could not fully offset the rising operational and finance costs. The company's bottom line was further impacted by a larger loss for the period, which grew to N232 billion compared to a loss of N133 billion in 2023. This stark loss highlights that, despite strong revenue generation, the company faced substantial challenges in managing costs and financial pressures, leading to a negative net income.

One of the more consistent aspects of Oando’s performance was its earnings per share (EPS), which remained steady at N5 per share, identical to the previous year. This consistency in EPS indicates that the company’s basic profitability did not fluctuate dramatically, despite the overall loss. As of the end of January 30 2025, Oando’s market price stood at N76.00 per share, with an earnings yield of 6.68%. This reflects the market’s valuation of the company based on its current performance and potential future growth.

Recommendations: Hold or Sell?

Oando’s 2024 financials present a complex picture for investors. On one hand, the company saw impressive revenue growth and a notable increase in gross profit, suggesting strong operational capacity and market positioning. However, the significant increase in costs, particularly in finance charges and operating expenses, weighed heavily on its profitability. The higher-than-expected loss and the drop in profit before tax raise concerns about the company’s ability to manage its costs effectively in a challenging economic environment.

For investors, the recommendation would be to "HOLD" unless there is a clear strategy for improving cost management and enhancing operational efficiency. While the company has demonstrated resilience in driving revenue growth, the rising operational and finance costs remain a significant concern. Moreover, the larger loss for the period could have negative implications for shareholder returns in the short term. However, for those with a long-term investment horizon, Oando’s strong revenue growth, coupled with its market presence, may offer promising upside once the company addresses its cost structure and financial leverage.

While Oando has shown growth in key financial metrics, the challenges of rising costs, finance expenses, and overall financial losses signal that investors should be cautious and consider holding their positions until clearer signs of improved cost management and profitability emerge.

Wale is a typical Nigeria politician. He is running Oando the way Nigeria is been run. A lot of big talks but poor results.

Oando is still very unstable for a long term hold. The company is most likely not going to pay a dividend in 2025 and share prices might not even appreciate substantially given that it is still struggling with debts and running capital.

Aside the share bonus thing, there are no attraction for holding an Oando share right now.

My 2cent though.

SAK:
Any news?

Oando and Wale has been playing games... You just have to be patient as Oando is not a regular corporation. It is a complicated PLC.

KarlTom:
OandO

Any update yet?

It seems the update from Oando insiders is filtering in and the market is gradually responding positively.

What is the current price of Oando? Yochaa price seem not to be updating at the moment.

I feel like buying some Oando units before tomorrow board meeting.

mikeapollo:
You are right.
But from the first paragraph of the Notice, it is more likely the Board will fix a future date as the qualifying date.

A future date as qualifying date will seriously drive Oando price higher as it will create a lot of demand for the Oando shares.

mikeapollo:
The qualifyng date has not been fixed, so you can buy tomorrow and benefit.
But make sure you buy before the board meeting date of 30 January, to be very sure.

Thanks a million.

Will new Oando shares bought tomorrow benefit from the share redistribution or cash?

When is the closing date to qualify for the bonus?

Bagwa:
😁

You said it few days ago. I can bet on it that it is going to be cash.

badoh:
You be mumu.. Who is Wike reporting to?

You are daft hence you can't even understand the intent of my post... Do we have only Abuja in Nigeria?

Why are all the commissioned project of this government in Abuja?

You don't deserve a response from me anyway because I don't respond to kids...

Always flagging off projects but only Wike is commissioning projects

Oando almost full offer today...

ProphetUtuocha:
Mark this:
The same folks that watch Oando at the current price will struggle to buy when it crosses 100.

The prophet has spoken....

nosa2:
GTCO is heading to N400. Just relax and enjoy the ride

Dilution is coming...I am only going to buy bank shares after dilution.

Whoa, so it was true... Great news to move the stock price higher

megawealth01:
WAle the gamer
Anything to move Oando to eldorado

Bagwa:
Oando may pay cash equivalent to share to disturbe 😁

This is serious... I hope it doesn't turn out to be cash payment.

Bagwa sha, dey get his updates straight from the source...

Some Oando News
“Oando wins Angola bid round for Kwanza Basin Block”

https://africaoilgasreport.com/2025/01/farm-in-farm-out/oando-wins-the-angolan-bid-round-for-kwanza-basin-block-kon-13/

OANDO acquiring everything acquirable.... Great news for Oando

I was hoping Oando share price will remain a bit low till next week, so that I can do another 100,000 units topup before it starts moving.

Today's movement alone dropped ₦1.2million on my two accounts.

KarlTom:
Keep an eye on OandO...

Bought some units today when it dipped.

Sunrisepebble:
Femi Ote$ is not playing games.

“ Alleged N12.3bn Fraud: EFFC To Arraign Oba Otudeko, Onasanya, Two others”

https://www.channelstv.com/2025/01/16/alleged-n12-3bn-fraud-effc-to-arraign-oba-otudeko-onasanya-two-others/amp/

These big men are criminals....

What many people don’t know about Otedola is that he started as a very shrewd moneylender. In one tribute Bob Dee wrote about him, he described Otedola as ruthless when it came to recovering his money. The man wouldn’t even look Uche in the eye—when it was time to collect, he’d take your car or anything of value without hesitation.

They say Ote doesn’t joke with money. If you owe,

KarlTom:
No loud am... 🤭

With the little clarify Wale gave yesterday, Oando might gradually edge towards ₦70.

Wale is a master of this market... He is a gamer.

Rivers State high court Abi? Clowns

megawealth01:
What exactly did Wale say?

Wale is a funny guy... very snaky and tricky.

Buying Oando shares is like placing a bet in BetNaija... long term, Oando looks scary.

chimex38:
GDP has been rebased again.
I say make I update you.
So you can understand NBS stats better

https://businessday.ng/big-read/article/explainer-what-gdp-cpi-rebasing-means-for-economy/

So what is the new GDP of Nigeria?

Raider76:
Wale Tinubu’s Bold Path for Oando

https://www.thisdaylive.com/index.php/2025/01/13/wale-tinubus-bold-path-for-oando/?amp

Wale the hype man.... No substance in all these media hypes.

Health3:
Oando good news will appear like a thief in the night. Where is @bagwa?

essentialone1:
Sunu Assurance seems to be going back to the trenches where it belongs to...

Most insurance stocks will return back to where they started from.

Their fundamentals have not changed and also there are no solid information yet concerning their recapitulation.... The current rapid price growth will be short lived.

Oando matter tire person... Wale has always acted like a politician. He is far from being a corporate executive.

Anything Oando is complicated and twisted. I have this feeling that this Share Bonus thing will take a strange dimension soon.

Wale plays the market like a gamer.