OKOMUOIL Declares N8.50bn PAT in 2018 Audited Results, Proposes N3.00k Per share Dividend


Friday, March 29, 2019 01:32PM / NSE

Proshare Nigeria Pvt. Ltd.


Initial Reaction – FBNQuest



Okomu’s FY 2018 results came in weaker than expected. FY PBT of N10.3bn came in behind consensus’ N11.1bn forecast and missed our estimate of N11.2bn by around 6.3%. The firm proposed a dividend of N3.00 (vs. our N3.20 estimate) which implies a yield of around 4%. Notwithstanding, we expect a negative reaction by the market because to our minds the magnitude of the dividend is insufficient to offset the disappointment of these results.



Gross margin expanded by +511bps y/y to 41%. However, it appears that there has been a reclassification of items between the cogs and opex lines.



While Q4 sales declined -2.8% y/y, PBT and PAT both declined by -18% y/y and -63% y/y respectively. The topline decline, the third in a row, was primarily driven by lower rubber sales which fell by around -11% y/y to N879m. Rubber exports are constrained due to on-going road works to Nigeria’s busiest export terminal in Apapa, Lagos. Similar to Q3, palm oil sales were relatively flattish during the quarter which continues to provide some evidence supporting our view that imported competition is growing. Sequentially, the trend was broadly similar, driven however by a significant gross margin contraction.  


Year-to-date, the stock has gained +5%, outperforming the broad index by c.7%.


We rate the stock Outperform. Our estimates are under review.


Okomu Oil’s Q4 2018 results: actual vs. FBNQuest Capital Research estimates (N millions)

Proshare Nigeria Pvt. Ltd.

Source: NSE, FBNQuest Capital Research estimates

Proshare Nigeria Pvt. Ltd.

Related News

1.        OKOMUOIL Declares N7.24 bn PAT in Q3 2018 Results (SP:N79.8k)

2.       Okomu Oil Q2 2018 Results -Operating Expenses Declined By -26% YoY to –N1.5bn.

3.       OKOMUOIL Q2 2018 Result- Volumes Slump Drives Earnings Weakness

4.       OKOMUOIL Notifies That Certifications by ERA and FoEN on RSPO Are Spurious and Libelous

5.        Okomu Oil Q1 2018 Results Review: Neutral Rating Maintained

6.       OKOMUOIL Reports Q1 2018 Results – OPEX Grew by 116% YoY

7.        OKOMUOIL Declares N3.47bn PAT in Q1 2018 Results (SP:N73.50k)

8.       Okomu Oil Q4 2017 Results Review: Neutral Rating Maintained

9.       Okomu Oil Plc Commissions Its Extension 2 Estate

Related News