Eterna Oil, a prominent player in Nigeria’s oil and gas sector, has experienced a loss of N181.9 million in the first quarter of 2023 compared to a gain of N210 million recorded in the same quarter of 2022.
Despite these challenges, Eterna Oil recorded a revenue increase of 16.25 percent, reaching N31.18 billion in the first quarter of 2023 compared to N26.82 billion in the same quarter of 2022. The majority of its revenue, amounting to N26.81 billion, was generated from trading activities.
Furthermore, operating expenses also grew by 58 percent, rising to N1.79 billion in the first quarter of 2023 from N1.14 billion recorded in the same period of 2022.
In the first quarter of 2023, there was a decrease in other income by 11.45 percent to N36 million, as compared to N40.7 million recorded in the same quarter of 2022.
Finance income also experienced a significant decline of 80 percent to N4.4 million during the first three months of the year, in contrast to N22.4 million recorded in the same period of 2022. This decline can be attributed to a decrease in interest income from short-term bank deposits.
Conversely, finance costs witnessed an increase of 44 percent to N310.6 million in the first quarter of 2023 from N215.6 million recorded in the same period of 2022. This increase arose from higher interest on loans, which can be attributed to the successive interest rate hikes implemented by the central bank.
Read also: REGIC gross written premium up 10% to N14.2bn in 2022
The profit for the period being evaluated showed a slight increase of 0.9 percent, reaching N1.09 billion compared to N1.08 billion recorded in the corresponding period of 2022.
During the period under review, the total equity and liabilities amounted to N61.4 billion, indicating an increase from N53.9 billion recorded in the same period of 2022.
In terms of cash flows generated from operating activities, there was a loss in the first quarter of 2023 amounting to N3.48 billion, contrasting with a gain of N1.66 billion recorded in the same period of 2022.
Net cash used in investing activities also experienced a loss in the period under review, amounting to N387.6 million, as opposed to N844.9 million recorded in the same period of 2022.
However, there was an increase of 2.1 percent in net cash generated from financing activities during the period under review, amounting to N4.8 billion, compared to N4.7 billion recorded in the same period of 2022.
As of March 31, 2023, cash and cash equivalents grew by 8.7 percent, reaching N11.69 billion, in comparison to N10.75 billion recorded in the same period of 2022.
Downstream oil and gas sector players have been losing money as the state oil corporation Nigerian National Corporation Limited (NNPLC) has been the sole importer of the premium motor spirit otherwise known as petrol.
But the industry dynamics are about to change with the removal of petrol subsidy and the coming on board of the 650,000 per barrel Dangote Refinery in the second quarter of this year; the refinery is expected to significantly shrink fuel scarcity and fix the dislocation in the downstream oil and gas sector that has been hamstrung by lack of investment.