The demand for the stocks on the petroleum sub sector of the Nigerian Stock Exchange (NSE) have been on a decline apparently for the market meltdown which saw many investors burning their fingers.
Conoil Plc is among the few companies in the sub sector that has begun to reposition its self through its strategic planning aimed at boosting earnings.
Apparently taking a cue from recent forecasts by market operators, the major players in the downstream business are repositioning strategically for the anticipated challenges and opportunities that the new order is expected to usher in.
It is in the light of the current reality that major oil marketing companies, such as Conoil Plc, has flagged off various projects and initiatives to help it capitalise and reinforce its strong position to deliver profitable growth.
In what operators describe as a strategic performance-enhancing move, Conoil has stepped up investments in the core segments of the downstream business with a view to consolidating its competitive edge and breaking new grounds to further boost its market share.
The strategic investment project entails upgrading and construction of facilities in the priority areas, such as retail, lubricants, aviation and specialized products, so as to provide additional capacity that will enable it to meet the long-term needs of its growing business.
According to a statement by the management of Conoil, the focus of the current initiative is to deepen the company’s market penetration and establish new streams of income to further strengthen its competitive edge.
Chairman of the company, Dr. Mike Adenuga, had consistently expressed the determination to sustain the culture of taking advantage of opportunities in the emerging markets and organizing efforts and resources along enduring strategies for top performance.
“There is an ongoing review of our business processes to boost commercial, innovation and supply chain efficiencies, to improve focus on growth opportunities and to enhance competencies that will drive accelerated progress,” he said in his message to shareholders in the company’s 2009 annual report obtained by our correspondent.
The company had recently announced the Board of Directors’ proposal of N1,040,928,000 dividend in respect of the year ended December 31, 2009. Going by the proposed dividend, which will be tabled for approval at the company’s 40th annual general meeting in Ibadan on October 22, shareholders will get N1.50 on every 50 kobo ordinary share, which translates into 50% increase over what was paid in 2008.
The audited financial report shows that it posted N3.8 billion profit before tax (PBT) in 2009, an increase of 15 per cent over the N3.3 billion recorded in the previous year. Profit after tax also shot up by 27 per cent, from N1.8 billion in 2008 to N2.3 billion. while its net assets rose from N11.9 billion to N13.5 billion.
Explaining the renewed drive to shore up the company’s bottom-line, the statement said it was aimed at upgrading facilities and building modern infrastructures in depots located in strategic parts of the country, with a view to taking full advantage of the emerging markets in the industry.
One major component of the expansion initiative is the construction of a massive depot in Port Harcourt, Rivers State, which is meant to complement its flagship depot in Apapa, Lagos. Located near the free port zone of Onne, the ultramodern facility, which cost about N12 billion, will provide easy access to fuel imports and ease the current pressure on available jetties and other port infrastructures in Lagos.