WorldStage Newsonline– Oando PLC, Nigeria’s leading indigenous energy group listed on both Nigerian Exchange Limited and Johannesburg Stock Exchange has advised stakeholders that its net earnings for the year ended 31st December 2019 will be significantly below that of the prior year.
In a notice at the Nigerian Exchange signed by Ayotola Jagun, Company Secretary , the expected reduction in earnings was attributed to “The adverse impact of the COVID-19 pandemic on the global demand for oil in 2020 resulted in lower forecasted oil prices, thus triggering a re-assessment of the expected future cash flows from our oil and gas assets. Accordingly, we have taken the prudent approach of recognizing a substantial impairment of a portion of the Group’s intangible assets that arose from acquisitions done in prior years.
“Following the successful resolution of a disruptive and value destructive longstanding shareholder dispute, we have taken a decision to recognize a significant impairment on a category of the Group’s intangible and financial assets arising from the financing and settlement of the resolution.”
Despite the expected reduction in earnings, the company said it remained fully committed to returning the Group to profitability by pursuing organic and inorganic growth opportunities in the upstream and increasing its trading volumes.
