Engen Botswana Limited, the petroleum outfit listed on the Botswana Stock Exchange (BSE), pumped more joy into the market as its full year result rebounded to the pre- international fuel price spikes that dominated the best part of 2008.
Net profits to March 31, 2010 were up 414 percent to P 90.5 million and net profit was bullish at P 176 million bulking the generally subdued economic mood.
The GDP was under pressure in the last two years which started with a flare-up in international crude oil prices that was later compounded by the economic downturn sparked by the subprime mortgage crisis in the United States of America.
The fuel price spikes that came before the USA general election that saw Baraka Obama taking over as president of the world’s richest country were fueled by President George W Bush war mongering tactics that heightened geo-politics in the Middle East.
That saw crude oil prices hitting US $ 147 per barrel during 2008 and at the same time pushing up inflation to 14 percent region.
“ .. in announcing our group results which show that the company’s underlying performance remains strong despite modest growth in GDP. The group achieved a 414 percent in the net profit and the replacement costs results show a 23 percent increase in profit compared to the previous financial year,” the company said.
The country’s real growth prospect were battered over the last year as key diamond mines and others were forced to either close and scale-down operations in a bid to avoid cost leading to 2.9 percent growthÔÇöbeing a slip from the targeted six percent.
The move had a ripple effect on the general economy that is heavily reliant on miningÔÇöespecially diamonds as companies and retail consumers scale-down on consumption.
However, the company said a combination of initiatives such as bolstering its retail outreach and sophistication while at the same time government’s development projects kept it running at the time of need.
“The fuel side the business showed reasonable growth in volumes due to strong government expenditure to weather the negative effects of global recession. The operating company also made significant investments in the retail network which translates into improved average sales per site,” the company added.
It said during the year it supplied a special grade of bitumen for tax lanes at the new look Sir Seretse Khama International Airport and Francistown Airport.
“This was in addition to the supply of fuel, mainly diesel to the main contractors for these projects,” Engen said in a statement.
However, Engen indicated that turnover was almost neck ÔÇôto ÔÇôneck with cost of sales as they recorded P 1.180 billion and P 1 billion respectively.
The South African- Asian company which is itching to have the largest footprint in the country after the planned exit of BP said it remained committed to its tradition of “first to market” with the launch of Corner Bakery at some of its new sites to support its Quickshop brand.
Earnings per share jumped up to 56.7 thebe against 11 thebe in the last reporting period and declared dividend per share of 15 thebeÔÇöagainst 8 thebe in the previous year — pushing the envelop to 26 thebe for the full year.