Ardova Q3 revenues up 6.1%

Ardova PLC, an integrated energy company, has recently announced a 6.1% increase in revenues for the third quarter, totaling 136 billion naira. Despite the growth in revenue, the company experienced a decline in profit during the same period. Olumide Adeosun, the CEO of Ardova, sat down with CNBC Africa to discuss the financial results and shed light on the factors impacting the company's performance. Adeosun highlighted several key points during the interview, emphasizing that although the price of Premium Motor Spirit (PMS) remained relatively stable, the company witnessed an increase in the price of freight. This led to a significant impact on the company's performance. Adeosun mentioned that the pricing changes in the lubricant space also contributed to the revenue increase, as the company adjusted its pricing to align with market costs. Despite a slight drop in lubricant volumes, Ardova saw substantial growth in the aviation fuel sector, attributed to effective marketing strategies and securing long-term contracts with international carriers. Adeosun also discussed the cost pressures faced by the company in the third quarter, which influenced the overall financial performance. He highlighted various cost factors, including increased freight costs, the absence of gains from asset disposal, reduced rental income due to property renovations, and tenant evictions. These cost pressures contributed to a shortfall of approximately one billion naira compared to the previous year's performance. Adeosun acknowledged the challenges posed by regulated petrol prices on the company's efficiency gains but emphasized the strategies in place to optimize the value chain and enhance operational efficiency. He highlighted the expansion of retail stations as a key initiative to drive economies of scale and improve profitability. Adeosun also clarified the company's approach to its subsidiary, Enyo, stating that there are no plans for rebranding and that Enyo will operate independently while leveraging opportunities for supply consolidation. Regarding technology integration, Adeosun emphasized the importance of leveraging technology to streamline operations and enhance customer service. He discussed the deployment of advanced technologies such as quad controllers, automatic tank gauges, and data analytics tools to optimize processes and provide real-time insights. The company is also working on a digital transformation program called EVO to digitize platforms for improved operational efficiency. Adeosun hinted at potential opportunities for further business expansion based on the company's vast infrastructure and customer base. He suggested the possibility of offering additional services such as last-mile fuel delivery, data-driven solutions, and community-centric initiatives. Ardova is strategically planning for the future, exploring new avenues for growth over the next three to five years, aiming to capitalize on its physical assets and data-driven capabilities to drive innovation and expand its business offerings.