Connect with us

Business News

How transparency is aiding NNPC to march towards profitability

Published

on

For a long time, the impression many people have about the Nigerian National Petroleum Corporations NNPC has been that of an organisation that operates in an industry that is opaque. With it activities often kept in secrecy and it is never believed that it can make profit.

But this perception is being changed with the series of reforms that have taken place with the coming of Mele Kyari at the head management of the corporation.

Having undergone series of reforms which have made it to be more transparent in it activities, the attention of EITI was drawn to it, and since then, the two bodies have been partners in the corporation’s chart for profitability.

Read also: NNPC says it has over 2bn litres of petrol in stock

One of the reforms that was carried out was the Transparency Accountability and Performance Excellence which has further consolidated it focus on transparency.

Through this process, oil marketers now buy products online. The automation of the processes in the Pipeline and Product Marketing Company (PPMC) and NNPC retails have enable the corporation to reduce waste.

The corporation through automation of it processes also was able to achieve the 2.3 million barrels daily production that the country had during the COVID19 pandemic lockdown. This has not been achieved in the last 10 years.

If there is one thing transparency does to any organization apart from showcasing its honesty and integrity, it helps to boost its performance; it helps to put its managers on their toes to do their best knowing that there is no room to hide their inefficiencies.

This NNPC commitment to transparency appears to begin to yield positive results in the form of huge reduction in losses – from N803bn losses in 2018 to 1.7bn losses in 2019

Since the corporation began its journey in transparency with the coming of Mele Kyari at the helm of affairs in 2018. It has since then recorded a series of firsts on the transparency front. It published its 2018 Audited Financial Statement earlier in the year for everyone to see, rather than the maintaining the old style of surreptitiously submitting it to statutory agencies like the Office of the Auditor General of the Federation. It also got listed as an EITI- partner company thereby officially sealing its commitment to transparency.

When the 2018 AFS was published, many critics came hard on the Corporation calling it a laggard among its National Oil Companies peers. They failed to see the significance of the noble act as a game-changer, a step that could launch it permanently on the path of growth.

The huge cut in losses is indicative of the new era of growth for the Corporation

The feat of huge loss reduction was achieved through improved performance driven mainly by cost optimization, contracts renegotiation and operational efficiency.

One of the key pointers to the fact of cost optimization in the Corporation as indicated in the 2019 AFS is the huge reduction of the General administrative expenses from N894billion in 2018 to N696billion showing a positive variance of 22 percent.

Majority of the subsidiaries, except the refineries which have been shut down for rehabilitation, also recorded huge growth in profit: For example, Nigeria Petroleum Development Company ( NPDC) recorded N479billion profit in 2019 compared to N179billion in 2018 representing 167 percent increase, Integrated Data Service Limited (IDSL) recorded N23billion profit in 2019 compared to N154million in 2018 representing 14966 per cent increase, PPMC recorded N14.2billion profit in 2019 compared to N9.3billion in 2018 representing 52% increase.

Some critics have argued that the 2019 AFS shows that NNPC was still on the brink of bankruptcy as a going concern since its liabilities were still higher than asset. But they did not to take into cognizance the determination of the current NNPC Management to make a difference. That determination has been amply displayed through its commitment to transparency and accountability which in turn is reflecting in excellent performance as recorded in the huge improvement in its financial position – the huge reduction in losses.

If this trajectory is followed, it is possible that 2020 will see NNPC on a solid profit path since it management has continued on the drive to reduce cost, promote efficiency, and rev up profits.

Whatsapp mobile
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business News

Dangote Cement’s London IPO to wait till 2023

Published

on

Aliko Dangote, Africa’s richest person, has again delayed plans to sell shares in his cement maker on the London Stock Exchange, opting instead to focus on increasing exports and boosting the Nigerian company’s foreign-exchange reserves according to Bloomberg.

Dangote Cement Plc, the continent’s biggest producer of the building material, isn’t expected to attempt a U.K. initial public offering until at least 2023, Temilade Aduroja, head of investor relations at the Lagos-based company, said by email.
“The London listing is not something which will happen in the short to medium term,” he said. “We are focused on our export strategy and increasing our foreign-currency revenue.”

Aliko Dangote, 63, who has a net worth of more than $14 billion, has long expressed his ambition for Dangote Cement to have a secondary London listing to diversify its ownership and gain access to cheaper funds on international markets. Yet for one reason or another he’s never managed to pull the trigger.

The controlling shareholder said in 2018 the listing would happen the following year, only for Brian Egan, former chief financial officer, to state that 2020 was more likely.

Nigeria’s biggest listed company by market value, Dangote Cement took advantage of a drop in yields in the domestic debt markets to raise 100 billion naira ($259 million) through commercial papers in May and April, the largest offering of its kind at the time.

The group said in July it’s looking to export clinker to 15 countries in Central and West Africa in a bid to boost revenue and resolve a scarcity of foreign exchange scarcity in Nigeria.

Continue Reading

Business News

Eid-El-Maulud: Okowa calls for prayer for Nigeria’s progress

Published

on

Delta Governor, Ifeanyi Okowa, has called on Muslims in the country to offer prayers for the peace, unity and continuous progress of Nigeria, as they join other faithful across the world to celebrate Eid El Maulud, the birth of Prophet Mohammed.

The governor, in a statement signed by his Chief Press Secretary, Olisa Ifeajika, urged Muslims to follow the exemplary leadership of the Holy Prophet by promoting peaceful existence.

He charged Nigerians to shun all divisive tendencies and work towards building a better nation, saying that the celebration of the birth of the Prophet should renew the faith and bond of unity irrespective of diversity.

Okowa particularly urged the Muslims and other religious groups to embark on sustainable supplication for needed reforms for a better Nigeria.

“On behalf of my family, the government and people of Delta, I extend our warmest wishes to Muslims celebrating Eid-el-Maulud in Delta, Nigeria and around the world. I congratulate all our countrymen and women on this special day.

“As we celebrate, it is my hope and prayer that we imbibe the spiritual lessons in the Holy Prophet’s teachings of piety, love, justice, fairness, equity, peaceful co-existence, tolerance, honesty and dedication to duty, which if well practiced, will be for the benefit and greater glory of our dear nation.

“Let us remember to pray fervently for our nation to achieve greater unity and progress among our fellow countrymen and women, irrespective of religion or place of origin, and promote greater commitment to the peace, unity and stability of the nation.

“It is my hope that this celebration will bring joy to all your homes, here in Delta, Nigeria and around the world,” He stated.

Whatsapp mobile
Continue Reading

Business News

Nigeria’s CcHUB acquires another Kenyan startup, eLimu

Published

on

Barely one year after it took control of Kenya’s foremost incubator and accelerator iHub, Nigerian-based Co-Creation Hub (CcHUB) has again moved on to another tech company in the East African country, eLimu.

The acquisition of eLimu, a digital educational content provider in the East Africa region, interestingly, was perfected by iHub on behalf of CcHUB.

A statement by CcHUB said the goal is to transform eLimu into the digital education platform arm of the company. The move may also be part of a growing trend by Nigerian tech founders to grow their frontiers beyond Africa’s largest economy notoriously plagued by insecurity, high foreign exchange volatility, and a business policy environment that is seen as stifling small businesses. Kenya, with its 51 million population is seen as one of the few relatively stable economies on the continent that is actively encouraging tech businesses.

eLimu, according to the statement, will continue to focus on leveraging cutting edge technology to create interactive and engaging learning content customised to the African context which will be initiated using the existing apps. The acquisition will enable eLimu to scale the apps beyond Kenya.

CcHUB has actively supported EdTech businesses and has also floated a digital education company known as Re:learn, a platform that helps students and schools use technology in smart ways to enhance learning.

“Education is the bedrock of healthy societies,” ‘Bosun Tijani, co-founder, and Chief Executive Officer, CcHUB, said. “As we continue to contribute to shaping the innovation ecosystem in Africa, accelerating the application of innovation and technology in improving education outcomes will be crucial to driving our overall agenda.”

eLimu has an existing audience of approximately 500,000 teachers and learners. With COVID pushing up interest in eLearning, eLimu said it has seen unprecedented growth rates in recent times.

Some of the services include revision and literacy platforms that make learning fun and engaging for curious children both at school and at home. The combination of engaging content with proven methods and practice of teaching has ensured that learning outcomes on eLimu improve dramatically for over 500,000 learners.

eLimu also has literacy apps for 6 and 7 year-olds that includes dozens of stories written by Kenyan teachers, illustrated by artists across East Africa, and read by voice actors and celebrities, such as Caroline Mutoko famously known for hosting a morning breakfast show on Kiss 100 FM.

The stories cover different aspects of learning including letter tracing, spelling, and sentence making exercises. The eLimu platform also has different translations such as English, Swahili, Somali, and Lugbarati. The company noted an independent study in Dadaab refugee camp which indicated progress in reading fluency 3 times faster than the control group.

“I’m thrilled to see eLimu spread its wings across Africa to make learning fun and engaging for even more children,” Nivi Sharma, founder of eLimu said. “eLimu will continue to leverage its deep knowledge of the education system to tap into the opportunity to transform learning everywhere.”

As part of the acquisition deal, Abiola Olaniran, founder and CEO of Gamesole, will form part of the management team as eLimu’s Chief Technology Officer. The statement from CcHUB said it expects Olaniran who has a track record in building high-performing and lucrative technology products to play a key role in transforming eLimu into the leading digital educational content provider on the continent.

Continue Reading

Trending

NgGossips.com