Edwin Provencal, BOST MD
Contrary to a series of online portal report that the Bulk Oil Storage and Transportation Company Limited (BOST) has incurred a loss of GH¢400million, the company has rather made a profit.
The report as put out on the portals originated from a lack of knowledge of how to interpret accounting figures BOST management explained over the weekend.
The depreciation of the cedi, for instance, when one is analysing the accounting books of a company, could pose a challenge for the uninitiated.
BOST has rather made great strides under the current management having for instance cleared judgment debts and now a toast of investors and banks. “These are important indicators about the progress made by the company,” a top official of BOST told DAILY GUIDE.
The erroneous report about the state of BOST emanated from a misinterpreted State Interests and Governance Authority (SIGA) report about the company making an operating profit before tax of GH¢30million.
In a reaction, BOST management stated that “we, by this publication seek to correct the erroneous impressions created by the publication and wish to set the record straight as follows, the Underlying Business of your company, BOST is PROFITABLE – The report of the GH¢400million losses made by BOST is not accurate. To measure the profitability and operational efficiency of a business, one must determine whether the underlying operations (core business) of the company are profitable.”
Continuing, the BOST MD during his presentation at SIGA said the company “had achieved a profit before tax of GH¢9,844,673 versus an estimated GH¢30million in year 2020 as against a loss of GH¢158,478,676 in 2019.”
BOST management pointed out that “the positive net profit before tax attained in 2020 implies a massive turnaround of the operational fortunes of the company. The MD had stated that “unpaid tax obligations over the five-year period to date, the reduction in the value of our GOIL investment, and forex difference on dollar denominated loans may turn the profit before tax into a net loss for the period.”
This enhanced performance, he said, “was driven by extensive operational efficiency initiatives including, but not limited to massive repair works of our storage tanks, pipelines and marine assets, and replacement of outmoded parts.”
BOST explained that “several events outside management’s control that impacted the overall business negatively, thus posting a loss for the year 2020 in the statement of comprehensive income.
A case in point is the outcome of a revaluation of company assets in the 2020 financial year because “most of the assets still in operation had been written down to near-zero levels”
BOST’s 20 per cent stake in GOIL management stated impacts on the profitability or otherwise of the company.
By A.R. Gomda