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NNPC Loses N9.53 Billion as Revenue Plunges by 300 Percent

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Mele Kyari

NNPC Reports N9.53 Billion Loss in Revenue in the Month of March

The Nigerian National Petroleum Corporation (NNPC) on Wednesday reported a N9.53 billion loss for the month of March as the drop in oil prices due to the global pandemic weighed revenue of the corporation.

According to findings, this is NNPC’s first operational loss since October 2018 when the corporation reported N12.66 billion in lost revenue.

A breakdown of monthly operational reports revealed that NNPC realised N2.06 billion and M12.13 billion in trading surpluses in November and December of 2018.

This momentum was carried over to 2019 as the company reported N15.04 billion, N16.72 billion, N11.72 billion, N5.6 billion, N6.33 billion and N3.92 billion surpluses for the months of January, February, March, April, May and June, respectively.

In July, August, September, October, November and December 2019, NNPC generated operational surpluses of N4.26 billion, N5.2 billion, N8.59 billion, N13.23 billion, N3.95 billion and N5.28 billion, respectively.

Similarly, the corporation posted N1.87 billion and N3.95 billion in the month of January and February 2020, respectively.

But at the peak of COVID-19 pandemic when global oil prices were hitting lower lowers before finally hitting an all-time low in April, the NNPC lost over 300 percent in revenue in March due to about 181 decline in the Nigerian Petroleum Development Company’s revenue.

Accordingly, the corporation recorded a 30.89 percent decline in sales to $256.19 million in the month.

This trend is expected to continue in April and May given the huge plunge in oil prices during the two months. April was the peak of the global pandemic when the US West Texas Intermediate crude oil was trading at a record low of -$37 per barrel while Brent crude oil, the benchmark for Nigeria’s oil, declined to $15 per barrel.

This decline, if persists, is expected to further weigh on government’s ability to fund the 2020 budget.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

Nigeria’s Food Inflation Drops Marginally in April 2021

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Food Inflation - Investors King

Food inflation in Nigeria, Africa’s largest economy, slowdown marginally from 22.95 percent in March to 22.72 percent in the month of April, the National Bureau of Statistics (NBS) reported on Monday.

Increases were caused by surged “in prices of Coffee, tea and cocoa, Bread and cereals, Soft drinks, Milk, Cheese and egg, Vegetable, Meat, Oils and Fats, Fish and Potatoes, Yam and other tubers.

On a monthly basis, the food sub-index grew by 0.99 percent in April 2021, down by 0.91 percent when compared to the 1.90 percent filed in March 2021.

The average annual rate of change of the Food sub-index for the twelve-month period ending April 2021 over the previous twelve-month average was 18.58 percent, representing an increase of 0.65 percent from the average annual rate of 17.93 percent recorded in March 2021.

Nigeria’s Inflation rate moderated to 18.12 percent year-on-year in April.

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Economy

Nigeria’s Inflation Moderates Slightly to 18.12 Percent in April 2021

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Nigeria's Inflation Rate - Investors King

Inflation in Africa’s largest economy, Nigeria, moderated from 18.17 percent year-on-year recorded in March 2021 to 18.12 percent year-on-year in the month of April 2021, according to the latest report from the National Bureau of Statistics (NBS).

On a monthly basis, inflation rose by 0.97 percent in April, down from 1.57 percent filed in March 2021.

Rising foreign exchange rates amid over-dependence on foreign goods continue to pressure consumer prices in Africa’s most populous nation, Nigeria.

Also, herders and farmers clashes across key food-producing states have disrupted food production and escalated prices of locally produced food items. Suggesting that the highly unemployed population with low wages will continue to cut down on purchases.

A situation that if persists will plunge retail sales, economic productivity, new investments, new job creation and drag the nation back into recession.

Despite efforts to stimulate growth following COVID-19 disruption, the Central Bank of Nigeria has failed to drive economic activities with lower interest rates of 11.5 percent as many investors are either looking into fixed income market, stocks, or the now restricted cryptocurrency.

Food prices rose by 18.58 percent year-on-year in April, representing a 0.65 percent increase from the 17.93 percent reported in March.

On monthly basis, food prices increase by 0.99 percent in April, down by 0.91 percent 1.90 percent recorded in March,

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Economy

Local Electronic Card Industry Will Save Nigeria About $100M Import Bill – PayPlus CEO

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Forex Weekly Outlook March 6 - 10

Nigeria may be saving about $100million annually with local manufacture of electronics card as bank cards alone gulp about $36 million.

This was disclosed by Bayo Adeokun, the Managing Director of Electronic Payplus Limited, one of the few electronic card manufacturing firms in sub-Sahara Africa.

Speaking to some media operatives last week at the backdrop of commencement of operations at its multimillion dollar new manufacturing installations, Adeokun stated: “Bank cards alone is about $36 million every year prior to our intervention. I have not done the cost of a SIM card; I have not done the cost of tax card by Lagos State government for instance and other states that are now coming up with that; I have not talked about the national ID card and I have not talked about the voter’s card. By the time you put everything together in terms of dollar, you will be talking about $100 million savings for the country.”

Calling on the Federal Government to take steps to protect investments in the card industry, he stated further: “In this period that remittances from abroad are going down, crude oil revenue is coming low and all of that the government really needs to make a lot of savings in terms of foreign reserves.”

He also harped on the employment value the industry adds to the economy saying, “Prior to this (commencement of its new production lines) Electronic Payplus had about 100 staff. Now, we are up to 150. So we are also generating employment. I mean, if you look at the nature of Nigeria, those 50 staff, each of them has a dependence, so we are talking of an additional 500 or more that we are catering for.”

Giving details of the company’s new production capacity, he said, “we can do any smart card. So the purpose is to extend it to every area of the economy. I showed you the national ID card downstairs we produce for Nigeria. So we are known to the government. Now, when the present administration came in they said there is no money to finance the production of that again. So they said they want to go into a digital ID card. We are also playing in that space because we have the license.

“We presently enrolled Nigerians in the diaspora. We do local enrollment that is currently ongoing as well. We have the license to produce that. We also are presently working with the Lagos State government because they want to roll out what is called a residency card which is also going to be a payment card. So we are going to service all the industries.

“We are also talking to telecommunication companies on the possibility of supplying their sim cards as well. Also are looking beyond Nigeria. We have customers all over Africa. All the banks in Gambia produce all their cards, for instance. We have customers in Ghana, Guinea, Cameroun, Uganda and Kenya.”

On the impact of the company’s new production facility upgrade, he said, “What we have done is 60 million production cards per annum capacity.

“But the idea is all about improved turn around that we can offer because, today if you give me an order of one million cards, I can deliver it within a week.

I can even deliver 250,000 per day to you. So we believe that that will be a game changer for us, and in addition, we are now able to scale up our capacity utilization as well as market share as quickly as possible.”

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