Oando’s chances of continuing business doubtful as debt widens funding gap

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Oando, listed in Lagos and Johannesburg, saw the arrears it owed trade partners and other payables climb by more than half to N705.8 billion, causing liabilities to surge past assets and leaving shareholders’ funds in the red.

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“A material uncertainty, therefore, exists that may cast significant doubt on the company’s and group’s ability to continue as a going concern, thereby resulting in the company’s and group’s inability to realise the assets and settle the liabilities in the ordinary course of business at the amounts recorded in these consolidated and separate financial statements,” said Independent auditor BDO Professional Services.

Management has lined up a long list of grand but unlikely plans to rescue the company’s precarious financial position. “The Group has forecast that it will return to profitability by 2024, but the forecast is highly dependent on the successful completion of the acquisition of NAOC’s working interest in OML 60 – 63,” Oando added.

 

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