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OAO - Oando - Audited results for the full year ended 31 December 2008

Release Date: 09/06/2009 11:00:03      Code(s): OAO
OAO - Oando - Audited results for the full year ended 31 December 2008          
Oando Plc                                                                       
(Incorporated in Nigeria and registered as an external company in South Africa) 
Registration number: RC 6474                                                    
(External company registration number: 2005/038824/10)                          
Share Code on the JSE Limited: OAO                                              
Share Code on the Nigerian Stock Exchange: UNTP                                 
ISIN: NGOANDO00002                                                              
("Oando" or "the Company" or "the Group")                                       
Audited results for the full year ended 31 December 2008                        
-  Turnover of $2.69bn                                                          
-  Gross profit of $326.11m                                                     
-  Operating profit of $138.59m                                                 
-  Profit after tax of $74.27m                                                  
-  Attributable profit after tax of $74.23m                                     
-  Earnings per share of 8.20c                                                  
-  Strong growth in revenue                                                     
-  Marked improvement in gross margin                                           
-  Significant contribution from upstream operations                            
-  Acquisition of additional rig                                                
-  Completion of Lagos Phase Three Project of gas distribution network          
Review of results                                                               
Oando, which has a primary listing on the Nigerian Stock Exchange ("NSE") and a 
secondary listing on the JSE Limited ("JSE"), reports profit after tax ("PAT")  
for the full year ended 31 December 2008 of $74.27m.                            
Income statement analysis                                                       
Our performance for the year ended 2008 was a marked improvement over prior     
year. These results demonstrate our deep and unalloyed commitment towards       
achieving our strategic goal of becoming the leading energy solutions provider. 
The performance, anchored on superior operating efficiency was driven by all our
business divisions. The report is a further reflection and affirmation of our   
unflinching bias towards increasing shareholders` wealth through strong         
performance and commitment to best ethical business practice.                   
Our Corporate drive for 2008 was centered on operational excellence with        
customer service as a pivotal platform for all our activities. This initiative  
brought about improved performance supported by relative political and economic 
stability. Indeed except for the unfortunate depreciation in exchange rate      
towards the end of last year with attendant implication for import finance and  
related trade transactions, our performance would have been better than what is 
being reported now .                                                            
Our full year performance continues the recent trend recorded in the last three 
quarters. Overall, consolidated turnover increased by 79% from $1.50bn in       
December 2007 to $2.69bn in December 2008. This is attributable to the          
following: increased business activities especially our Supply & Trading and    
marketing divisions; improvement in our supply chain management; on-time        
delivery across the businesses; stability in the business environment;          
significant contribution from our upstream operation  and improved product      
availability during the year.                                                   
The positive growth in turnover coupled with marked improvement in margin       
efficiency led to an 88% increase in gross profit of the Group from $173.28m    
recorded in 2007 to $326.11m in 2008.                                           
Significant progress recorded in operational efficiency ensured a modest 37%    
growth in marketing and selling expense against 79% recorded at turnover level. 
Administrative expense increased by 71% compared to prior period largely on     
account of provision and amortization recognised on intangible assets used in   
the upstream and energy service divisions. The Company`s effective cost         
containment effort resulted in an overall 59% increase in operating expense for 
the year culminating in 116% growth in operating profit of the Company to       
$138.59m from $64.13m recorded earlier in 2007.                                 
Finance cost increased during the year. This was largely due to the spike in    
local lending rates, increased borrowing attributable to delay in government    
settlement of Petroleum Subsidy Fund (PSF) receivables and bridging claim       
allowances and in meeting transaction obligations (following the deterioration  
of the Naira against major currency of US Dollar). Management will continue to  
seek avenues to minimise the company`s exposure to such volatility in future.   
Consolidated profit after taxation increased by 49% from $49.8m to $74.3m in    
2008. This growth is, as highlighted earlier, attributable to increased trading 
activities, strong margin recovery and modest growth in operating expenses.     
Profit after taxation attributable to ordinary shareholders rose by 69% to      
$74.3m from $43.9m while adjusted earnings per share increased by 27% from 6.94c
to 8.82c.                                                                       
Balance sheet analysis                                                          
Our fixed assets increased significantly by 53% last year due to acquisition of 
value-adding assets within the upstream and energy service divisions. The       
Company concluded on the purchase of the initial two rigs while an additional   
rig was bought during the year.  In addition, for the sum of US$189m the company
acquired a 15% stake in OML 125 and 134 being part of the stake previously owned
by Shell. Within the gas and power division, the ongoing  124km pipeline        
construction for our East Horizon gas pipeline project and the captive power    
plant brought about the increase in our long term receivables. Management       
believes these projects once completed, in addition to the upstream and energy  
service assets that are now in operation will together drive future             
profitability and sustainability of our Group company.                          
As a result of the significant increase in business operation, delay in         
government settlement of PSF receivables and bridging claim allowances, Group   
wide borrowing including import finance facilities increased to $1,407.56m. Most
of these facilities are taken to support our expanded trading activities and are
efficiently priced with our bankers.                                            
Continuous and efficient working capital management ensured the Company         
maintained a robust cash and bank balance of $374.64m, a $226.67m jump over the 
prior year position. Our stock level is efficiently managed and is consistent   
with the growth in turnover while our volume of trade debtor and other non-trade
balances has grown on the back of delay in government settlement of Petroleum   
Subsidy Fund(PSF) receivables. In 2008, there has been significant deterioration
in petroleum subsidy fund settlement by the Government culminating in PSF       
receivables in excess of $340m by the end of the year. This placed huge         
constraint on our working capital management as the Company had to resort to    
borrowing to meet obligation as and when due.                                   
Prospects for the Future                                                        
The Group during the period under review continued its expansion drive, which   
includes diversification from the lower margin segments, progressing to higher  
value areas of the energy value chain like Upstream Exploration & Production,   
high margin-based services and rigs drilling system; a strategy which we believe
will yield significant returns in the near future.                              
Our upstream division buoyed by the recent acquisition of part of Shell`s stake 
in OML 125 &134 is expected to contribute significantly to the bottom-line.     
Aggressive effort is also in place to bring other non-producing assets within   
the portfolio to production in 2009. Strategic alliances formed with major      
producers is expected to aid rapid "time to production" of these assets.        
Our energy service business is poised to deliver strong performance following   
the commencement of drilling operations by two of our rigs. The Company been    
awarded drilling contracts valued at US$150m by Agip Exploration. We expect to  
get the other rigs into contact in the shortest possible time.                  
Following the completion of the Greater Lagos II Gas project and commencement of
gas supply, we expect a substantial increase in contribution to our margin from 
our Gas and power division as more customers are connected to the supply grid in
2009. Eastern Horizon, our 124km pipeline project is expected to become         
operational by the end of the third quarter of 2009 while the Lagos State Water 
Works captive power plant, a pioneering effort of the Gas and Power division is 
also expected to be commissioned for use before the end of this year.           
The uncertainties surrounding the deregulation of the downstream sector         
notwithstanding, our marketing division is poised to sustain its current upward 
trend in profitability. Turnover levels witnessed during 2008 is expected to    
continue well into 2009. Management will continue its pursuit of maximum value  
extraction from the downstream division while effort will be made to sustain the
gain recorded in 2008. Non-fuel revenue drive will be sustained and improved    
upon while cost curtailment drive will permeate every facet of the division`s   
operation. We also expect significant improvement in government settlement of   
PSF receivables and bridging claims allowances.                                 
Our Supply & Trading business`s quest to dominate the West African market is    
gradually yielding results with the Company`s strategic alliances with major    
marketers within the axis. As the largest private importer of petroleum products
into Nigeria, the Company is expected to leverage on the market acceptability   
and niche that it has created to deliver strong performance before year-end and 
guarantee its sustainable growth in the coming years. The strategic alliances   
formed with the Group`s upstream operations amongst other partners appear       
brighter with the attainment of "first Oil".                                    
Consolidated Balance Sheet                                                      
As at 31 December 2008                                                          
                                             2008          2007                 
ASSETS                                        $`million     $`million           
Non-current assets                                                              
Property Plant & Equipment                    693.12        284.35              
Intangible Assets                             175.04        259.58              
Available for sale financial assets           0.00          0.09                
Long Term Receivables                         114.18        97.76               
982.34        641.78               
Current assets                                                                  
Inventories                                   122.93        212.64              
Trade & Other Receivables                     727.49        401.10              
Cash & Cash Equivalents                       374.64        147.97              
                                             1,225.05      761.71               
Total assets                                  2,207.39      1,403.49            
Capital & Reserves attributable to equity                                       
Share Capital                                 3.49          2.90                
Share Premium                                 227.28        232.91              
Revaluation Reserve                           47.35         56.95               
Exchange Difference                           6.15          28.25               
Retained Earnings                             57.15         53.74               
                                             341.42        374.74               
Minority Interest                             1.160         1.61                
Total equity                                  342.58        376.35              
Non-Current Liabilities                                                         
Borrowing                                     318.86        152.45              
Deferred income tax liabilities               57.27         42.60               
Retired benefit obligation                    0.00          2.70                
Provisions                                    9.46          3.66                
385.59        201.41               
Current Liabilities                                                             
Trade & Other Payables                        364.86        361.90              
Current Income Tax Liabilities                25.67         11.29               
Borrowings                                    1,088.70      452.58              
                                             1,479.22      825.73               
Total Liabilities                             1,864.81      1,027.13            
Total Equity & Liabilities                    2,207.39      1,403.49            
Consolidated Income Statement                                                   
for the full year ended 31 December 2008                                        
                                          2008            2007                  
$`million       $`million             
Sales                                      2,686.54        1,501.79             
Cost of Sales                              (2,360.44)      (1,328.51)           
Gross Profit                               326.11          173.28               
Selling & Marketing Costs                  (63.11)         (46.23)              
Administrative Expenses                    (141.75)        (82.89)              
Other Operating Income                     15.35           19.96                
Operating Profit                           138.59          64.13                
Shares of Profit of Associates             -               -                    
Finance Costs                              (47.13)         (3.44)               
Profit Before Taxation                     91.46           60.69                
Income Tax Expense                         (17.19)         (10.89)              
Profit After Expense                       74.27           49.80                
Attributable to:                                                                
Non-Controlling Shareholders               0.04            5.86                 
Equity Holders of the Company              74.23           43.94                
74.27           49.80                 
The Group company is organised into four main business divisions:               
- Exploration and production of oil and gas (E&P) - involved in the             
 exploration for and production of oil and gas through the acquisition of       
rights in oil blocks on the Nigerian continental shelf and deep offshore       
- Refining and marketing of petroleum products - involved in the refining of    
 crude and the marketing and sale of petroleum products. Over the years,        
 the Group had focused primarily on the marketing of petroleum products.        
Presently, the Group is in the process of acquiring and developing a           
 refinery business. The activities of the trading companies are reported        
 under this segment.                                                            
- Gas and power - involved in the distribution of natural gas through its       
subsidiaries Gaslink and Eastern Horizon (incorporated during the year).       
 The Group also incorporated a Power company to serve a niche in Nigeria`s      
 power sector, by providing reliable power to industrial customers. The         
 company is however yet to commence operations.                                 
- Energy services- involved in the provision of services such as drilling       
 and completion fluid; oil-well cementing and other services to upstream        
Below is the Group performance on a divisional basis for the full year ended 31 
December 2008:                                                                  
             Exploration  Refining &   Gas & power  Energy      Total           
             &            marketing                 services &                  
             production                             Group                       
             US$`000      US$`000      US$`000      US$`000     US$`000         
Gross segment 106,240      4,304,425    55,524       35,018      4,501,207      
Inter-segment -            (1,814,663)  -            -           (1,814,663)    
Revenue       106,240      2,489,762    55,524       35,018      2,686,544      
Operating     40,274       101,439      5,908        (9,030)1    138,591        
Finance costs (11,171)     (36,308)     (1,141)      1,488       (47,132)       
- net                                                                           
Profit before                                                    91,459         
income tax                                                                      
Income tax                                                       (17,191)       
Profit for                                                       74,268         
the year                                                                        
Below is the Group performance on a divisional basis for the full year ended 31 
December 2007:                                                                  
             Exploration  Refining &   Gas & power Energy       Total           
&            marketing                services &                   
             production                            Group                        
             US$`000      US$`000      US$`000     US$`000      US$`000         
Gross segment -            1,384,624    35,456      84,332       1,504,412      
Inter-segment -            (2,618)      -           -            (2,618)        
Revenue       -            1,382,006    35,456      84,332       1,501,794      
Operating     (1,345)      58,925       5,340       1,209        64,129         
Finance costs -            (3,084)      1,917       (2,270)      (3,437)        
- net                                                                           
Profit before                                                    60,692         
income tax                                                                      
Income tax                                                       (17,191)       
Profit for                                                       43,501         
the year                                                                        
Consolidated Statement of changes in Shareholder`s Equity Attributable to equity
holders of the Company For the full year ended 31 December 2008:                
                                Share    Share    Revaluation  Cumulative       
                                Capital  Premium  reserve      translation      
US$m     US$m     US$m         US$m             
Balance as at 31 December 2007   2.90     232.91   56.96        28.25           
Retained profit for the period                                                  
Bonus issue of shares            0.59     (0.59)                                
Dividend paid                                                                   
Exchange difference                                (6.29)       (22.10)         
Reversal of revaluation surplus                    (4.61)                       
Deferred tax on revaluation                        1.38                         
Share Issue Cost                          (5.04                                 
Balance as at 31 December 2008   3.49     227.28   47.50        6.15            
                                               Retained  Minority  Total        
earnings  interest  equity       
                                               US$m      US$m      US$m         
Balance as at 31 December 2007                  53.74     1.61      376.35      
Retained profit for the period                            0.03      74.27       
Bonus issue of shares                                                           
Dividend paid                                   (70.82)   (0.48)    (71.30)     
Exchange Difference                                                 (28.40)     
Reversal of revaluation surplus                                     (4.61)      
Deferred tax on revaluation surplus                                 1.38        
Share Issue Cost                                                    (5.04)      
Balance as at 31 December 2008                  57.15     1.16      342.58      
Share    Share    Revaluation  Cumulative       
                                Capital  Premium  reserve      translation      
                                US$m     US$m     US$m         US$m             
Balance as at 31 December 2006   2.16     120.74   11.37        7.11            
Revaluation surplus on property                    66.31                        
plant and equipment                                                             
Deferred tax effect of residual                    (20.55)                      
value restatement                                                               
Issue of shares/Disposal of      0.74     112.16                                
minority Interest                                                               
Fair value gain/loss on                            (0.173)                      
available for sale investments                                                  
Currency Translation adjustment                                 21.14           
Balance as at 31 December 2007   2.90     232.91   56.96        28.25           
                                              Retained  Minority  Total         
earnings  interest  equity        
                                              US$m      US$m      US$m          
Balance as at 31 December 2006                 28.03     14.65     184.05       
Revaluation surplus on property plant and                          66.31        
Deferred tax effect of residual value                              (20.55)      
Issue of shares/Disposal of Minority interest            (13.23)   99.67        
Fair value gain/loss on available for sale                         (0.173)      
Currency Translation adjustment                                    21.14        
Profit for the year                            43.94     0.19      44.14        
Final Dividend for 2006                        (18.23)             (18.23)      
Balance as at 31 December 2007                 53.74     1.61      376.35       
Notes to reviewed results                                                       
1. General information                                                          
Oando (formerly Unipetrol Nigeria Plc) was registered by a special resolution as
a result of the acquisition of the shareholding of Esso Africa Incorporated     
(principal shareholder of Esso Standard Nigeria Limited) by the Federal         
Government of Nigeria. The Company was partially privatised in 1991. It was     
however fully privatised in the year 2000 consequent upon the sale of Federal   
Government`s 40% shareholding in the Company. 30% was sold to core investors    
(Ocean and Oil Investments Limited) and the remaining 10% to the Nigerian       
public. In December 2002, the Company merged with Agip Nigeria Plc following its
acquisition of 60% Agip Petroli`s stake of Agip Nigeria Plc in August of the    
same year. The Company formally changed its name from Unipetrol Nigeria Plc to  
Oando Plc in December 2003.                                                     
The principal activity of the Company locally and internationally is to have    
strategic investments in energy companies across West Africa. The Group is      
involved in the following business activities via its subsidiary companies:     
- Marketing of petroleum products, manufacturing and blending of lubricants     
 - Oando Marketing Limited                                                      
- Distribution of natural gas for industrial customers - Gaslink Nigeria        
- Supply and distribution of petroleum products - Oando Supply and Trading,     
 Nigeria; and Oando Trading, Bermuda                                            
- Energy services to upstream companies - Oando Energy Services                 
- Exploration and Production - Oando Exploration and Production.                
2. Summary of significant accounting policies                                   
The principal accounting policies applied in the preparation of these           
consolidated financial statements are set out below. These policies have been   
consistently applied to all the years presented, unless otherwise stated.       
2.1 Basis of preparation                                                        
The consolidated financial statements of Oando have been prepared in accordance 
with International Financial Reporting Standards (IFRS). The consolidated       
financial statements have been prepared under the historical cost convention, as
modified by the revaluation of land and buildings, and financial assets and     
financial liabilities at fair value through profit or loss.                     
The preparation of financial statements in accordance with IFRS requires the use
of certain critical accounting estimates. It also requires management to        
exercise judgement in the process of applying the Group`s accounting policies.  
Early adoption of standards                                                     
In 2004, the Group early adopted the IFRS below, which are relevant to its      
operations. These have been consistently applied in this Audited financial      
report for the full year of 2008.                                               
IAS 2 (revised 2003) Inventories                                                
IAS 8 (revised 2003) Accounting Policies, Changes in Accounting Estimates and   
IAS 10 (revised 2003) Events after the Balance Sheet Date                       
IAS 16 (revised 2003) Property, Plant and Equipment                             
IAS 17 (revised 2003) Leases                                                    
IAS 21 (revised 2003) The Effects of Changes in Foreign Exchange Rates          
IAS 24 (revised 2003) Related Party Disclosures                                 
IAS 27 (revised 2003) Consolidated and Separate Financial Statements            
IAS 28 (revised 2003) Investments in Associates                                 
IAS 32 (revised 2003) Financial Instruments: Disclosure and Presentation        
IAS 33 (revised 2003) Earnings per share                                        
IAS 36 (revised 2004) Impairment of Assets                                      
IAS 38 (revised 2004) Intangible Assets                                         
IAS 39 (revised 2003) financial instruments: Recognition and measurement        
IFRS 2 (issued 2004) Share-based payments                                       
IFRS 3 (issued 2004) Business Combinations                                      
IFRS 5 (issued 2004) Non-current Assets Held for Sale and Discontinued IFRIC 10 
(Issued 2006) Interim Financial Reporting and Impairment.                       
-   The early adoption of IAS 10 has resulted in a change in the accounting     
   policy for dividends. Proposed dividends, which were previously              
recognised in the year prior to the declaration, have been adjusted in       
   accordance with IAS 10 and 37 respectively.                                  
-   The application IAS 16 has affected the accounting for fair value           
   reserve relating to revalued land and buildings upon disposal.               
-   Under previous GAAP, the revaluation surplus included in equity in          
   respect of an item of property, plant and equipment were transferred to      
   the income, when the asset is disposed of, to determine profit on            
   disposal. Adjustments have been passed to transfer the related amounts       
directly to retained earnings in accordance with IAS 16. Also, early         
   adoption of IAS 16 (revised 2004) has necessitated the disclosure of         
   prior year comparatives for all movements in property plant and              
-   IAS 21 (revised 2003) has affected the translation of foreign entities`     
   income statements, on which closing rates were previously applied but        
   now amended and translated at average rates. The functional currency of      
   each of the consolidated entities has also been re-evaluated based on        
the guidance to the revised standard. All the Group entities have the        
   same functional currency as their presentation currency. These               
   financial statements have been presented in a currency other than the        
   Company`s functional currency, being US Dollars, to meet the filing          
requirements of the JSE.                                                     
-   IAS 24 (revised 2003) has affected the identification of related            
   parties and some other related-party disclosures.                            
-   IAS 27 (revised 2004) has affected the consolidation of subsidiaries.       
Certain subsidiaries, which were not included in the consolidation           
   under previous GAAP have now been consolidated.                              
-   The early adoption of IAS 33 has resulted in a change in the                
   computation of earnings per share. Earnings per share, which were            
previously computed on the basis of the number of shares in issue at         
   the end of the reporting period, have been adjusted on the basis of the      
   weighted average number of shares in accordance with IAS 33.                 
-   The early adoption of IAS 39 has resulted in a change in accounting for     
financial assets and liabilities.                                            
-   The Group obtained approval for its share option scheme from the            
   regulatory authority in February 2009. Accordingly all shared-based          
   payment in operation has been subjected to and accounted for under IFRS      
2 for the first time in 2008.                                                
-   The early adoption of IFRS 5 has resulted in a change in the accounting     
   for non-current assets held for sale and discontinued operations as          
   qualifying assets have been reclassified accordingly.                        
-   The early adoption of IFRS 3, IAS 36 (revised 2004) and IAS 38 (revised     
   2004) resulted in a change in the accounting -policy for goodwill.           
   Until 31 December 2002, goodwill was:                                        
   -   Amortised on a straight line basis over a period ranging from 5 to       
20 years; and                                                            
   -   Assessed for an indication of impairment at each balance sheet           
-   In accordance with the provisions of IFRS 3:                                
-   The Group ceased amortisation of goodwill from 1 January 2003;           
   -   Accumulated amortisation as at 31 December 2002 has been eliminated      
       with a corresponding decrease in the cost of goodwill;                   
-   Goodwill was tested for impairment at 1 January 2003, the transition        
date. Also, from the year ended 31 December 2003 onwards, goodwill is        
   tested annually for impairment, as well as when there are indications        
   of impairment. The Group has also reassessed the useful lives of its         
   intangible assets in accordance with the provisions of IAS 38. No            
adjustment resulted from this reassessment.                                  
All changes in the accounting policies have been made in accordance with the    
transition provisions in the respective standards.                              
The early adoption of IAS 1, 2, 8, 17 28, and 32 (all revised 2003) did not     
result in substantial changes to the Group`s accounting policies.               
In summary:                                                                     
- IAS 1, 2, 28 and 32 had no material effect on the Group`s policies.           
- IAS 8 (revised 2004) has resulted in the disclosure of the impact of new      
2.2 Consolidation                                                               
(a) Subsidiaries                                                                
Subsidiaries include all entities (including special purpose entities) over     
which the Group has the power to govern the financial and operating policies    
generally accompanying a shareholding of more than one half of the voting       
rights. The existence and effect of potential voting rights that are currently  
exercisable or convertible are considered when assessing whether the Group      
controls another entity. Subsidiaries are fully consolidated from the date on   
which control is transferred to the Group. They are deconsolidated from the date
that control ceases.                                                            
The purchase method of accounting is used to account for the acquisition of     
subsidiaries by the Group. The cost of the acquisition is measured as the fair  
value of the assets given, equity instruments issued and liabilities incurred or
assumed and the date of plus costs directly attributable to the acquisition.    
Identifiable assets acquired and liabilities and contingent liabilities assumed 
in a business combination are measured initially at their fair values at the    
acquisition date irrespective of the extent of any minority interest. The excess
of the cost of acquisition over the fair value of the Group`s share of the      
identifiable net assets acquired is recorded as goodwill. If the cost of        
acquisition is less than the fair value of the net assets of the subsidiary     
acquired, the difference is recognised directly in the income statement. All    
balances and unrealised surpluses and deficits on transactions between group    
companies have been eliminated. Where necessary, accounting policies for        
subsidiaries have been changed to be consistent with the policies adopted by the
Company, Separate disclosure (in equity) is made of Minority Interests.         
(b) Associates                                                                  
Associates are all entities over which the Group has significant influence but  
not control, generally accompanying a shareholding of between 20% and 50% of the
voting rights. Investments in associates are accounted for by the equity method 
of accounting and are initially recognised at cost. The Group`s investment in   
associates includes goodwill (net of any accumulated impairment loss) identified
on acquisition. The Group`s share of its associates` post-acquisition profits or
losses is recognised in the income statement, and its share of post acquisition 
movements in reserves is recognised in reserves. The cumulative post-acquisition
movements are adjusted against the carrying amount of the investment.           
When the Group`s share of losses in an associate equals or exceeds its interest 
in the associate, including any other unsecured receivables, the Group does not 
recognise further losses, unless it has incurred obligations or made payments on
behalf of the associate. Unrealised gains on transactions between the Group and 
its associates are eliminated to the extent of the Group`s interest in the      
associates. Unrealised losses are also eliminated unless the transaction        
provides evidence of an impairment of the asset transferred. The accounting     
policies of the associates are consistent with the policies adopted by the      
Goodwill included in the carrying amount of an investment is neither amortised  
nor tested for impairment separately by applying the requirements for impairment
testing goodwill in IAS 36, Impairment of Assets. Instead, the entire carrying  
amount of the investment is tested under IAS 36 for impairment.                 
All subsidiaries and associates have uniform calendar year ends.                
2.3 Segment reporting                                                           
A business segment is a group of assets and operations engaged in providing     
products or services that are subject to risks and returns that are different   
from those of other business segments. A geographical segment is engaged in     
providing products or services within a particular economic environment that are
subject to risks and return that are different from those of segments operating 
in other economic environments.                                                 
2.4 Foreign currency translation                                                
(a) Functional and presentation currency                                        
Items included in the financial statements of each of the Group`s entities are  
measured using the currency of the primary economic environment in which the    
entity operates (`the functional currency`). The functional currency of the     
Group is the Naira. The consolidated financial statements are presented in US   
dollars, which is the Company`s presentation currency for the purpose of filing 
outside Nigeria.                                                                
(b) Transactions and balances                                                   
Foreign currency transactions are translated into the functional currency using 
the exchange rates prevailing at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement of such transactions and from the
translation at year-end exchange rates of monetary assets and liabilities       
denominated in foreign currencies are recognised in the income statement, except
when deferred in equity as qualifying cash flow hedges and qualifying net       
investment hedges.                                                              
c) Group Companies                                                              
The results and financial position of all the group entities (none of which has 
the currency of a hyperinflationary economy) that have a functional currency    
different from the presentation currency are translated into the presentation   
currency as follows:                                                            
1  Assets and liabilities for each balance sheet presented are translated       
  at the closing rate at the date of that balance sheet.                        
2  Income and expenses for each income statement are translated at average      
  exchange rates; and all resulting exchange differences are recognised         
  as a separate component of equity.                                            
3  On consolidation, exchange differences arising from the translation of       
the net investment in foreign entities are taken to shareholders`             
  equity. Upon disposal of part or all of the investment, such exchange         
  differences are recognised in the income statement as part of the gain        
  or loss on sale.                                                              
3. Earnings per Share                                                           
Basic Earnings Per Share (EPS) is calculated by dividing the Profit Attributable
to the equity holders of the Company by the weighted average number of shares in
issue during the period.                                                        
2008     2007           
Profit attributable to equity holders of the Company     74.23    43.94         
Average number of shares in issue (millions)             842.04   632.89        
Basic Earnings Per Share (cents)                         8.82     6.94          
Profit attributable to equity holders of the Company     74.23    43.94         
Weighted average number of shares in issue (millions)    754.07   632.89        
Adjustment for Bonus issues                              150.81                 
Weighted average number of shares for diluted Earnings   842.04   632.89        
Per Share (millions)                                                            
Diluted Earning Per Shares (cents)                       8.82     6.94          
Headline Earnings Per Share                              8.82     6.94          
Profit Attributable to equity holders of the Company     74.23    43.94         
Adjusted for:                                                                   
Profit on sale of buildings associated with              0        (5.14)        
discontinued operations                                                         
Profit/(Loss) on sale of other assets                    0        0             
Loss on sales of investment in affiliate companies       0        0             
Tax thereon                                              0        1.08          
Headline Earnings Per Share attributable to earnings     8.82     6.30          
basis (cents)                                                                   
Headline Earnings Per Share attributable to diluted      8.82     6.30          
earnings basis (cents)                                                          
Net Assets Per Share (cents)                             37.86    49.91         
Tangible Assets Per Share (cents)                        18.52    15.49         
4. Independent audit by the auditors                                            
This condensed consolidated result has been audited by our auditors             
PricewaterhouseCoopers who perform their audit in accordance with the           
International Standards on Auditing.  The results have been reviewed by         
PricewaterhouseCoopers whose unqualified review opinion is available for        
inspection at the Company`s registered office.                                  
5. Post balance sheet events                                                    
There are no significant post balance sheet events that in the opinion of the   
Directors will have a material impact on the accounts herein presented.         
For and on behalf of the Board                                                  
Mr J Adewale Tinubu                                                             
Group Chief Executive                                                           
5 June 2009                                                                     
1  Major General M. Magoro (Rtd.) OFR, Galadiman      Chairman                  
2  Mr. J. A. Tinubu                                   Group CEO                 
3  Mr. O. Boyo                                        Deputy Group CEO          
4  Mr. B. Osunsanya                                   Group Exec Director       
5  Mr. A. Akinrele SAN                                Director                  
6  Prince F. N. Atako JP                              Director                  
7  Mr. Navaid Burney                                  Director                  
8  HRM. Oba. A. Gbadebo CFR                           Director                  
9  Mr. O. Ibru                                        Director                  
10 Alhaji H. Mahmud Walin Mubi                        Director                  
11 Mr Onajite Okoloko                                 Director                  
12 Mr. I. Osakwe                                      Director                  
Company Secretary: Mrs. Oredeji Delano                                          
Registered office: 2, Ajose Adeogun Street, Victoria Island, Lagos, Nigeria     
Auditors: PriceWaterhouseCoopers, Plot 252E Muri Okunola Street, Victoria       
Island, Lagos                                                                   
E-mail: info@oandoplc.com                                                       
Registered office in South Africa: 1st Floor, 32 Fricker Road, Illovo Boulevard,
Sandton, 2196, South Africa                                                     
Office of the South African registrars: Computershare Investor Services         
(Proprietary) Limited (Registration number: 2004/003647/07)                     
70 Marshall Street, Johannesburg, 2001. PO Box 61051, Marshalltown, 2107        
9 June 2009                                                                     
Sponsor: Deutsche Securities (SA) (Proprietary) Limited                         
Date: 09/06/2009 11:00:02 Supplied by www.sharenet.co.za                     
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