GOIL records GH¢105.5 million profit after tax

The Ghana Oil Company (GOIL) recorded a profit after tax of GH¢105.5 million in 2019, a 29 percent rise compared to the previous year, due to strong growth in sales volume of mining, aviation fuels and bunkering.

Consequently, the state-owned oil marketing company’s earnings per share moved from GH¢0.209 to GH¢0.269. Total asset also increased from GH¢1.345 billion to approximately GH¢1.716 billion within the year under review, GOIL’s Board Chairman, Kwamena Bartels, said during the company’s 51st annual general meeting.

It also voted a dividend per share of GH¢0.045 for shareholders as against 0.042 in 2018.

The aviation sector, which forms a key component of the company’s growth strategy, has grounded to a halt since the first quarter of this year, due to the Coronavirus pandemic.

This has led questions been asked about the sort of impact the COVID-19 induced global lockdown will have on the company’s performance.

GOIL, is however, hopeful that an early reopening of the country’s airports to international flights, will help its bid to increase its foothold in the aviation fuel sector and sustain last year’s gains.

This is because the company’s aviation fuel and bunkering grew 70 percent and 44 percent in 2019. Its market share also rose from 7.7 percent to 11.3 percent and from 38 percent to about 61 percent respectively for aviation fuel and bunkering.

This, along with a 6 percent growth in sales volume of mining fuel, propelled GOIL’s overall sales volume to a growth of by 9.66 percent, above the Industry rate of 6.44 percent.

“Mining activity in terms of sales volume is going on almost unaffected and we are still into bunkering business which is also looking good. The aviation sector has been affected but it is not too bad as you may think because there is a lot of cargo planes coming into the country and we believe that the September 1 for airport and boarders to open will help us to do recouping,” Chief Operating Officer, Alex Josiah Adzew said.

On the overall impact of the virus on company’s operations, he admitted that COVID, especially during the lockdown, affected the industry so much that “we lost about 60 percent of our volume of sales between March and mid May, but thankfully, there is a lot of recovering going on and we believe we will be able to claw-back what we lost through other strategies.”

Part of the strategy is to focus more on the sale of traditional products – Diesel XP and Super XP, which form about 90 percent of volume of sales, Mr. Adzew added.

The company has embarked on projects that have the potential to yield higher gains in the future. For this reason, the board has decided to retain a considerable amount of the earnings per share to help finance the projects, according to the board chairman.

“GOIL will continue with its concerted efforts to increase sale of non-traditional products. As mentioned in our previous annual statement, this strategy will help compensate for falling demand for our traditional products, Super XP and Diesel XP.

Assuming the world is able to rid itself of the COVID-19, we are strongly convinced that the sale of non-traditional products will continue to increase overall sales as experienced during the year 2019,” Mr. Bartels noted.

He further added that the bitumen project, an MoU with Societe Multinationale de Bitumes (SMB) of Cote d’Ivoire to construct a $35 million bitumen plant in Tema, was ongoing and would be operational in 2021.

He said work regarding the construction of cylinder refilling plant has also started in earnest and the company hopes to complete the project by next year.

Meanwhile, on the company’s participation in the upstream industry, Managing Director and Group Chief Executive Officer, Kwame Osei Prempeh was hopeful that his outfit’s partnership with ExxonMobil will be helpful in the transition to production.

“ExxonMobil is one of the biggest upstream players in the world and partnering with them is a big plus for GOIL. We believe that is a step in the right direction and with our association with them, with time, we can be on own in the future,” he said.