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Published On: Mon, Apr 3rd, 2017

Mobil Beats Estimates On Steep Revenue Rise

(Independent) Mobil Nigeria has eked out handsome returns from its oil downstream and property businesses to beat earnings estimates even if revenues missed targets by a marginal level, causing analysts to advise investors to hold their positions in the company.
The oil company grew revenue by a whopping 46.4 percent to N94.1 billion from N64.2 billion in the financial year ending December 2016. The company missed estimates by 0.90 percent, according to data compiled by Bloomberg. It is estimated that revenues could fall to N92.97 billion in 2017 and N90.69 billion in 2018.
About 2 percent of the 2016 sales are Intra Company while the remaining 98 percent is to third party. Even if cost of sales rose 47 percent in the period from N53.23 billion to N78.4 billion, Gross profit jumped 43 percent to N15.7 billion from N10.9 billion achieved the year before.
The company’s operations showed a well managed one as it yielded operating profit of N11.76 billion which is 69 percent better than the N6.95 billion achieved in the equivalent period in 2015. This contributed to the 74 percent spike in pre-tax profit which rose to N12 billion from N6.91 billion. Vaulting pre-tax returns prompted a jump in net profit by 67.3 percent to N8.15 billion from N4.87 billion, which beat analysts estimate by 11.22 percent even if the figures are estimated to drop to N7.87 billion in 2017 and N7.46 billion in 2018.
At a marginal level, gross profit margin dropped to 16.7 percent from 17.1 percent but this is compensated for by rising operating, pre-tax and after tax profit margins. Operating margin, which indicates how well a company is managing its operations improved to 12.5 percent from 10.8 percent achieved the year before.

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