Higher Crude Oil Prices Boost Nigeria’s Oil and Gas stock

….As Seplat Energy Plc, Eterna Plc, 3 Others Make Top 5 Performing oil & gas stock

The Nigerian Stock Market is leveraging from the rise in crude oil prices, especially the oil and gas stocks which have remained on top among the indexes that measure different sectors on the Exchange.

The Oil and Gas Index which emerged as the best performing index has gained 64.42% year-to-date.

Positive sentiments had returned to the local stock market as the release of the full year 2021 and Q1’22 corporate earnings bolstered buying interests in dividend-paying stocks.

According to data from the Nigerian Exchange Limited tracked by Nairametrics, the oil and gas index which measures the performance of the oil and gas firms quoted on the NGX grew by 64.42% or 222.25 basis points to close at 567.26 index points on the 19th July 2022 as against the opening index of 345.01 index points at the beginning of the year 2022 trading on January 4, 2022.

According to data obtained by Nairametrics from the NGX which focused on the top 5 performing oil and gas stocks during the year to date, Seplat Energy Plc, Eterna Plc, MRS Oil Nigeria Plc, Oando Plc, and Conoil Plc made the list.

These stocks were selected based on their price performance from year to date and are represented by the percentage gained.

5. Conoil Plc – 17.95%

Shares of Conoil Plc have also leveraged from the positive run since the beginning of the year. The oil and gas company gained 17.95% in price during the current year, from N22.00 to N25.95 per share. The company enjoyed buy-interests which drove up the market capitalization to gain N2,741.11 billion to N18,008.06 billion at the close of trading on July 19, 2022, from the opening figure of N15,266.95 billion on January 4th.

• Conoil in the first quarter of 2022 reported a 21% decline in revenue to N26.15 billion from N33.09 billion in Q1 2021.
• The revenue generated from the sale of petroleum products in Nigeria showed that the proportion of white products contribution to revenue dropped to 90% to N23.42 billion in Q1 2022 from 94% to N31.16 billion reported in 2021 first quarter.
• The proportion of lubricants’ contribution to revenue increased by 10% to N2.73 billion when compared to 6% to N1.93 billion reported in the first quarter of 2021.
• Profit before tax stood at N742.96 million in Q1 2022 from N623.43 million in Q1 2021. Conoil paid a tax of N185.7 million in Q1 2022 from N199.5 million in Q1 2021 to report a 31.44% increase in profit after tax to N557.2 million in Q1 2022 from N423.9 million in Q1 2021.
• The shares of the company currently trade at N25.95 and have gained 17.95% year-to-date.

4. Oando Plc-23%

The share price of Oando Plc, grew by 23.3% during the period under review, from N4.42% to N5.45 per share, lifting the market capitalization to gain N12,804.26 billion or 23.3% to close at N67,751.20 billion on July 19, 2022, from the opening figure of N54,946.84 billion.

• During the twelve months ended December 31, 2020, Oando’s production was 44,550 bpd, compared to 42,492 bpd in 2019. In 2020, production consisted of 15,912 bpd of crude oil, 1,757 bpd/day of NGLs and 161,288 mcf/day (26,881 boe/day) of natural gas.
• The increase in production was a result of increased natural gas production at OML 60-63 (22%) offset by a 29% decrease in NGL production and a 5% and 15% crude production decrease at OML 56 and OML 13 respectively.
• Production decreases were a result of shut-ins for repairs, maintenance, and sabotage incidences at the facilities. During the twelve months to December 31, 2020, Oando spent $82.8 million on capital expenditures related to the development of oil and gas assets and exploration and evaluation activities, compared to $78.8 million in the twelve months to December 31, 2019.
• The shares of the company currently trade at N5.45 and have gained 23.3% year-to-date.

3. MRS Oil Nigeria Plc-32%

Shares of MRS Oil Nigeria Plc have also enjoyed a positive run since the beginning of the year despite the that the oil firm slipped into a loss position during the first quarter of 2022. The oil firm gained 32% in price during the current year, from N12.35 to N14.45.

• The company enjoyed buy-interests which drove up the market capitalization to gain N1,190.57 billion to close at N4,954.68 billion at the close of trading on July 19, 2022, from an opening figure of N3,764.11 billion at the beginning of trading on January 4th.
• MRS Oil Nigeria Plc, a major oil marketer released its financial statements for the 1st Quarter ended 31 March 2022 with a slip into loss after taxation of N41.450 million from a profit of N4.778 million in Q1 2021.
• Revenue for the quarter rose slightly to N17.896 billion from N17.349 billion in Q1 2021.
• The shares of the company currently trade at N14.45 per share and have gained 32% year-to-date.

2. Eterna Plc – 38.22%

The share price of Eterna Plc, grew by 38.22% during the period under review, from N5.05 per share to N6.98 per share, lifting the market capitalisation to gain N2.517 billion or 38.22% to close at N9,102.93 billion on July 19, 2022, from the opening figure of N6,585.93 billion.

• The growth in the share price of the company can be attributed to positive sentiment toward the company’s impressive FY and Q1’22 results.
• Eterna’s Financial Statements for the first quarter ended 31 March 2022 showed a 244.84% jump in group profit to N877.464 million from N254.453 million in Q1 2021.
• Group revenue also rose to N26.823 billion during the quarter from N14.39 billion in Q1 2021.
• The shares of the company currently trade at N6.98 and year-to-date have appreciated by 38.22%.

1. Seplat Energy Plc – 120.07%

The shares of Splat Energy Plc have enjoyed a positive run since the beginning of the year. The oil and gas firm listed on the NGX and LSE and the most capitalized oil firm has gained 120.07% in share price during the current year, from N650.00 to N1,430.

• The company enjoyed buy-interests which drove up the market capitalization to gain N459,280.98 billion to stand at N841,769.94 billion at the close of trading on July 19, 2022, from the opening figure of N382,488.96 billion at the beginning of trading on January 4th.
• Seplat Energy Plc recorded N100 billion revenue in the first three months of this year, which is 72.7 percent higher than the N57.9bn recorded in the similar period of 2021, according to its unaudited results for the period ended 31 March 2022.
• In a statement, the firm said its profit before tax (PBT) rose by 227.35% to N34.7bn from N10.6bn while it generated cash of N74.4bn from its operations from N1.7bn year-on-year.
• Its gross profit also soared to N48.8bn from N20.1bn year-on-year, rising by 142.8% as its safety record extended to 26.1 million hours without Lost Time Incident (LTI) as it recorded 2m hours in Q1 2022.
• The shares of the company currently trade at N1,430.50 and have gained 120.07% year-to-date.

NAIRAMETRICS