Okomu Oil Palm On track for a Record FY’20

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Like Presco, Okomu Oil Palm has benefitted immensely from the FG directive to close the land borders in order to reduce the incidence of smuggling. Global Rubber prices also improved in the first half of the year. The resulting increase in domestic CPO, Rubber prices and demand took topline and bottom line 58% higher y/y in H1’20.

With average global CPO prices coming in 24% higher q/q and demand expecting to have remained decent in the third quarter, we forecast another strong topline performance for the CPO manufacturer.

Okomu Oil Palm On track for a Record FY’20

Average global rubber prices also rose by 20% q/q to $163.91/MT in Q3, supporting topline as well as providing crucial FX receipts to the company. All in, we project a 2% q/q jump in topline to ₦6.7 billion, albeit 4% lower y/y due to the high base of Q3’19.

Even as Q3 remains a low-cost quarter for Okomu Oil Palm, we nevertheless forecast a 14% q/q and 26% y/y decline in EBIT to ₦2.2 billion (check the table. It doesn’t tally), dragged by higher costs amid inflationary pressures.

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Overall, with the higher cost profile in the quarter capping profits, we forecast a 22% q/q and 3% y/y moderation in PAT to ₦1.6 billion (check the table. It doesn’t tally).

Read Also:  Nigerian Households Experienced A Decline in Power Supply in Q2, 2019 - Report

Okomu Oil Palm On track for a Record FY’20 Brandspurng1
Source: Company Fillings, Vetiva Research

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Okomu Oil Palm On track for a Record FY’20 - Brand SpurOkomu Oil Palm On track for a Record FY’20 - Brand Spur
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2 COMMENTS

  1. […] Okomu Oil Palm Company PLC 2020 year-end financials show a significant 24.08% revenue growth when compared to the full year 2019 turnover. This was majorly driven by a 29.17% growth in local sales from N15.87bn to N20.50bn despite a 2.90% decline in export sales amid the closure of land borders. […]

  2. […] Okomu Oil Palm Company PLC 2020 year-end financials show a significant 24.08% revenue growth when compared to the full year 2019 turnover. This was majorly driven by a 29.17% growth in local sales from N15.87bn to N20.50bn despite a 2.90% decline in export sales amid the closure of land borders. […]

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Okomu Oil Palm On track for a Record FY’20 - Brand SpurOkomu Oil Palm On track for a Record FY’20 - Brand Spur

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