GOIL GROUP Facts Behind the Figures Presentation to the Ghana Stock - - PowerPoint PPT Presentation

GOIL GROUP

Facts Behind the Figures

Presentation to the Ghana Stock Exchange

May 2019

This document is prepared by Ghana Oil Company Limited 2

Table of Content

Introduction Background of GOIL Corporate Performance Strategic Direction 1 2 3 4 3 6 12 22

This document is prepared by Ghana Oil Company Limited 3

Introduction GOIL has over the years made significant strides in transforming itself from a near-moribund state enterprise to become the number one oil marketing giant in the country. Prior to 2007, the downstream sector of the petroleum industry was regulated and dominated by multinationals who controlled nearly 72% of the total market share. GOIL was not in the position to compete with these multinationals who were heavily supported by their parent companies abroad

This was GOIL in the Past

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Introduction

To be able to catch up with the competition and outperform the multinationals, there was the need for the company to embark on a new strategic direction, restructure its operations and rebrand to become a brand of choice for Ghanaians. From 2007, Management of GOIL embarked on a strategic road map to change the face of the company. The following strategic and tactical initiatives were adopted:

• Developed a 5 year strategic plan to guide the company in fulfilling its new objectives.
• Changed the company’s Vision and Mission in line with its new objectives.
• Listed the company on the Ghana Stock Market to raise capital for expansion
• Rebranded the company with a new logo to be identified as a brand of choice for customers.
• Value proposition that will identify the company as an indigenous OMC marketing quality petroleum

products competitively.

• Changed service stations outlook
• New corporate culture dubbed “ Good energy comes with a Smile”
• Aggressive communication programme
• Increased the number of service stations spread across the country.
• Embarked on developing new infrastructure to support its operations to become a market leader

These initiatives significantly changed the face of GOIL.

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Introduction

This is GOIL today:

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Background of GOIL

• Ghana Oil Company Limited (GOIL) was initially incorporated on June 14, 1960 as AGIP

Ghana with AGIP SPA of Italy and SNAM SPA as shareholders. In December 1968, Hydrocarbons International of Zurich, Switzerland bought into the company. In 1974, the Government of Ghana acquired 100% shares and changed the name to Ghana Oil Company Limited.

• It is registered with 1,000,000,000 shares of no par value out of which 391.86 million shares

have been issued.

• The Company has incorporated three subsidiaries currently being managed under the GOIL

Group.

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Our mission is:  to market quality petroleum and other energy products and services in all its branches in an ethical, healthy, safe, environmentally friendly and socially responsible manner.  to produce and manufacture goods or provide services which enhance or support the marketing, distribution and sale of the company’s products and services

VISION & MISSION

Our vision is to be a world-class provider of goods and services in the petroleum and other areas of the energy industry. Background of GOIL

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Subsidiaries

GOENERGY Limited, a Bulk Oil Distribution Company (BDC), whose operations are to distribute petroleum products to Oil Marketing Companies (OMC’s); GOIL Offshore Limited, an offshore company to provide offshore bunkering facilities to rigs, vessels and

• il tankers as well as engaging in upstream activities.

GO Financial Services Limited to provide electronic payment system and money transfer services.

Shareholding Structure

Name of Shareholder Holdings Government of Ghana 34.23% Social Security and National Insurance Trust 25.00% Bulk Oil Storage and Transport 20.03% Others 20.74% Total 100%

Background of GOIL

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The company's main business is marketing and distribution of petroleum products in Ghana. LPG Bunkering Lubricants Fuels Marketing Bitumen ATK Background of GOIL GoCard

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10

Depots

Takoradi Kumasi Buipe Tamale Tema Accra

BACKROUND OF GOIL Marketing Arms

Zonal Office North Zonal Office Upper Middle Belt Zonal Office South East Zonal Office South Zonal Office Tema Zonal Office West Zonal Office Middle Belt

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The company was incorporated as a Private Limited Liability Company on June 14, 1960 as AGIP Ghana Company Limited. The shareholders were AGIP SPA of Italy and SNAM S.P.A

SNAM S.P.A. transferred its shares to Hydrocarbons International Holdings

Government of Ghana acquired shares of AGIP SPA and Hydrocarbons International Holdings Special resolution is passed and name of Company changed to Ghana Oil Company Limited Conversion from Private Limited Liability Company to a Public Company and Listing on the Ghana Stock Exchange

1960 2007 1974 1968 1976 2010 - 2012 2013- 2016

Rebranding started in 2010, implemented in 2011 and launched in 2012. Incorporation of: GOENERGY Limited GOIL Offshore Limited GO Financial Services

HISTORICAL TIMELINE 2018

Partnered with ExxonMobil for upstream oil exploration

Background of GOIL

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Product Market Share

2014 2015 2016 2017 2018 Gasoline 167,204 239,155 268,476 265,904 278,626 Diesel 192,678 266,516 285,913 264,581 261,988 ATK 16,117 15,881 12,212 14,607 15,477 MGO Bunkering 23,985 34,622 36,511 52,057 46,562 LPG 12,581 14,409 19,031 22,299 27,865

• 50,000

100,000 150,000 200,000 250,000 300,000 350,000

Products Sales Volume (Metric Tonnes)

Petroleum Product 2014 2015 2016 2017 2018 Ranking 2018

GASOLINE 14.9% 20.3% 24.7% 24.6% 22.2%

1

GASOIL 13.4% 16.4% 19.7% 22.0% 18.3%

1

ATK 16.2% 14.2% 9.2% 8.8% 7.7%

4

MGO Bunkering 25.1% 25.8% 18.7% 26.5% 38.0%

1

LPG 5.2% 5.1% 6.8% 8.1% 9.7%

1

Corporate Performance

PRODUCT PERFORMANCE

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13.4% 16.4% 19.7% 22.0% 22.2% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 2014 2015 2016 2017 2018

Gasoline Market Share 2014-2018

14.9% 20.3% 24.7% 24.6% 18.3% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 2014 2015 2016 2017 2018

Gasoil Market Share 2014-2018

14.04% 15.77% 18.20% 18.30% 16.68% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 18.00% 20.00% 2014 2015 2016 2017 2018

GOIL Aggregate Market Share 2014-2018

Corporate Performance

Product Market Share PRODUCT PERFORMANCE

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1,547 1,955 2,028 2,468 3,081

• 1,000

2,000 3,000 4,000 2014 2015 2016 2017 2018 GH¢ Millions

Sales Revenue 2014 - 2018

20,166 22,211 35,256 39,335 54,114

• 10,000

20,000 30,000 40,000 50,000 60,000 2014 2015 2016 2017 2018 GH¢ ‘000

Net Profit 2014 - 2018

341 521 758 901 1,100

• 500

1,000 1,500 2014 2015 2016 2017 2018 GH¢ Millions

Total Assets 2014 - 2018

 Sales increased from GH¢1,547.03 million to GH¢3,080.51 million  Profit after tax increased from GH¢20.17 million to GH¢54.11 million  Total assets increased from GH¢340.83 million to GH¢1,099.50 million. 99.12% Growth 222.59% Growth 168.34% Growth

Corporate Performance

FINANCIAL PERFORMANCE 2014-2018

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Income Statement Highlights

2018 2017 Growth 2018 2017 Growth GH¢'000 GH¢'000 GH¢'000 GH¢'000 Net Revenue 5,091,624 4,078,563 24.84% 3,080,508 2,467,872 24.82% Gross Profit 287,135 202,807 41.58% 229,532 155,907 47.22% Operating Profit 120,507 80,088 50.47% 82,025 45,076 81.97% Profit before Tax 114,138 84,523 35.04% 76,195 49,511 53.90% Net Profit 81,947 65,089 25.90% 54,114 39,335 37.57% Company Group 2,467.87 3,080.51 500 1,000 1,500 2,000 2,500 3,000 3,500

2017 2018

GH¢ Million

Net Revenue - GOIL

4,078.5 6 5,091.62

• 500

500 1,500 2,500 3,500 4,500 5,500 2017 2018 GH¢ Million

Net Revenue - GROUP

39.34 54.11 10 20 30 40 50 60 2017 2018 GH¢ Million

Net Profit - GOIL

65.09 81.95 20 40 60 80 100 2017 2018 GH¢ Million

Net Profit - GROUP

Corporate Performance

FINANCIAL PERFORMANCE 2017-2018

Revenue growth is driven by:

• strong performance in the Retail Sector and Bunkering

as well as aggressive marketing campaign resulting in increase in sales volume

• Profit is driven by increase in margins and cost

management

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Balance Sheet Highlights

2018 2017 Growth 2018 2017 Growth GH¢'000 GH¢'000 GH¢'000 GH¢'000 Total Assets 1,345,513 1,036,510 29.81% 1,099,504 900,529 22.10% Total Liabilities 906,864 669,444 35.47% 750,196 594,970 26.09% Total Equity 438,649 367,067 19.50% 349,308 305,559 14.32% Group Company

900.53 1,099. 50 200 400 600 800 1,000 1,200 2017 2018

GH¢ Million Total Assets - GOIL

594.97 750.20 200 400 600 800 2017 2018

GH¢ Million Total Liabilities - GOIL

669.44 906.86 200 400 600 800 1,000 2017 2018

GH¢ Million Total Liabilities - GROUP

1,036. 51 1,345. 51 500 1,000 1,500 2017 2018

GH¢ Million Total Assets - GROUP

Corporate Performance

FINANCIAL POSITION 2017 - 2018

Asset growth driven by:

• Acquisitions and takeovers of distressed competitor

stations at strategic locations.

• Joint venture partnerships in station development.
• Investment in bunkering facilities at Sekondi Naval

Base and Takoradi main port.

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Corporate Performance

KEY RATIOS 2017 - 2018

4.97% 5.64%

3.80% 4.30% 4.80% 5.30% 5.80%

2017 2018

Gross Profit Margin

1.96% 2.37%

0.00% 0.50% 1.00% 1.50% 2.00% 2.50%

2017 2018

Operating Profit Margin

17.73% 18.68%

16.30% 16.80% 17.30% 17.80% 18.30%

2017 2018

Return on Equity

9.35 8.80

7.50 7.70 7.90 8.10 8.30 8.50 8.70 8.90 9.10 9.30 9.50

2017 2018

Fixed Asset Turnover

6.28% 6.09%

5.70% 5.80% 5.90% 6.00% 6.10% 6.20% 6.30% 6.40%

2017 2018

Return on Assets

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Corporate Performance

IMPACT OF GOENERGY

GOIL GOENERGY SYNERGY

• Reliable product supply
• Security

and quality

• f

Product guaranteed

• Stability of pricing in the industry.
• GOIL
• ffers

a ready

• ff-taker

to Goenergy

• GOIL
• ffers

parent guarantee to Goenergy.

2013 2014 2015 2016 2017 2018 13.76 20.17 22.21 35.26 39.34 54.11 17.36 18.39 25.75 27.83

GH¢ MILLION

GROUP NET PROFIT 2013-2018

GOIL GOENERGY

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The company’s Market Capitalisation increased from GH¢130.32 million to GH¢1,222.61 million representing a 838.19% growth.

Per share Statistics 2014-2018

The company commenced trading with an IPO price of GH¢ 0.20 per share in November 2007. The share price since then has performed impressively. As at the December 2018, the price has increased significantly by 1,263.64% above the first trading day share price of GH¢ 0.22.

GOIL has consistently paid dividend to shareholders since its listing on the GSE. 0.22 0.31 0.32 0.16 0.24 0.32 0.62 0.89 1.05 1.40 1.10 2.69 3.12 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50

GH¢

GOIL Share Price Trend since IPO

Market Statistics 2014 2015 2016 2017 2018 Issued Shares (000) 252,223 252,223 391,863 391,863 391,863 Market Captalization (GH¢ Million) 264.83 353.11 431.05 1,054.11 1,222.61 Per Share Statistics Price (GH¢) 1.05 1.40 1.10 2.69 3.12 Earning (EPS) 0.080 0.088 0.090 0.100 0.138 Dividend (DPS) 0.016 0.020 0.008 0.016 0.018 Market Ratios Price/Earning 13.13 15.90 12.23 26.90 22.59 Dividend Yield(%) 1.52% 1.43% 0.69% 0.61% 0.59%

264.83 353.11 431.05 1,054.11 1,222.61

• 200.00

400.00 600.00 800.00 1,000.00 1,200.00 1,400.00 2014 2015 2016 2017 2018

GH¢ Million

Market Capitalisation 2014-2018

Corporate Performance

STOCK MARKET PERFORMANCE

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Ratio Analysis – GOIL (2014-2018)

Corporate Performance

2014 2015 2016 2017 2018 5 Year Average Profitability Ratios Gross Profit Margin 5.70% 5.64% 7.18% 6.32% 7.45% 6.46% Operating Profit Margin 1.90% 1.77% 2.12% 1.83% 2.66% 2.05% Net Profit Margin 1.30% 1.14% 1.74% 1.59% 1.76% 1.51% Return on Equity 26.23% 23.72% 12.88% 12.87% 15.49% 18.24% Return on Total Assets 5.92% 4.26% 4.65% 4.37% 4.92% 4.82% Return on Capital Employed 32.32% 31.20% 15.04% 14.19% 19.70% 22.49% Leverage Ratios Equity Ratio 0.23 0.18 0.36 0.34 0.32 0.28 Interest Coverage 9.68 11.34 10.55 6.13 10.71 9.68 Debt/Equity 0.28 0.35 0.05 1.95 2.15 0.95 Operational Efficiency Ratios Asset Turnover 4.54 3.75 2.67 2.74 2.80 3.30 Fixed Asset Turnover 12.88 10.49 6.71 6.03 5.85 8.39 Account Receivable Days 37.33 49.23 55.73 57.88 55.56 51.15 Inventory Days 6.71 4.80 5.66 6.56 4.13 5.57 Account Payable Days 51.07 58.79 60.55 65.54 64.02 59.99 Liquidity Ratios Current Ratio 0.83 0.78 0.94 0.83 0.83 0.84 Quick Ratio 0.72 0.72 0.88 0.75 0.78 0.77

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Ratio Analysis – Group (2015-2018)

Corporate Performance

2015 2016 2017 2018 Average Profitability Ratios Gross Profit Margin 3.84% 5.09% 4.97% 5.64% 4.88% Operating Profit Margin 1.60% 1.95% 1.97% 2.37% 1.97% Net Profit Margin 1.09% 1.54% 1.60% 1.61% 1.46% Return on Equity 35.65% 17.33% 17.73% 18.68% 22.35% Return on Total Assets 6.76% 6.18% 6.28% 6.09% 6.33% Return on Capital Employed 45.27% 21.18% 21.20% 23.83% 27.87% Leverage Ratios Interest Coverage 18.87 16.57 10.47 14.70 15.15 Net Debt/Equity 0.29 0.04 0.00 0.15 0.12 Debt/Equity 4.27 1.81 1.82 2.07 2.49 Operational Efficiency Ratios Asset Turnover 6.20 4.02 3.93 3.78 4.49 Fixed Asset Turnover 18.08 11.09 9.35 8.80 11.83 Account Receivable Days 30.80 38.54 36.16 38.24 35.94 Inventory Days 3.66 5.20 10.49 9.53 7.22 Account Payable Days 37.43 53.69 56.00 57.75 51.22 Liquidity Ratios Current Ratio 0.84 1.01 0.91 0.91 0.92 Quick Ratio 0.76 0.92 0.74 0.76 0.80

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Strategic Intent Strategic Objectives

Market Expansion

• Consolidate market leadership position in fuel marketing retailing and

increase aggregate market share.

• Continue the expansion strategy
• Diverse into strategic and profitable areas of the industry.
• Penetrate into the West African sub regional market

Operational Capacity and Service Delivery

• Continue to build and improve the physical infrastructure, human

resource capabilities and business processes for efficient and effective service delivery. Dynamic Subsidiaries

• Strengthen existing and create new subsidiaries to enhance business

growth for profitability and competitive advantage. . Shareholders’ Value Maximisation

• Maximise shareholders’ wealth through sustainable growth in earnings.

To be the dominant Market Leader in the downstream Sector

• f the Petroleum industry

GOIL Strategic Direction

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Bitumen Storage Depot

The company is currently constructing a Bitumen storage Depot in Tema industrial area.

Mining Diesel

GOIL to penetrate into the mining sector of the petroleum industry.

Planned Projects

In line with new Government policy on LPG sales, GOIL is in the process

• f constructing an LPG cylinder recirculation plant in Tema and Kumasi.

Cylinder Recirculation Program Upstream Oil Exploration

Partnership With ExxonMobil for Upstream Oil exploration GOIL has identified these infrastructure as the key drivers for the achievement of it’s strategic goal of becoming the dominant market leader in the downstream sector of the petroleum industry in Ghana . GOIL Strategic Direction

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