(Alliance News) - Vivo Energy PLC on Friday posted lower gross profit for the third quarter of 2020, due to a decline in volumes, as localised restrictions remain despite the easing of Covid-19 containment measures.
However, Vivo decided to pay its previously withdrawn final dividend for 2019 as an interim dividend.
For the three months to the end of September, the downstream petroleum products distributor - which sells Royal Dutch Shell PLC-branded products - posted gross profit at USD187 million, a 1.0% decline from USD189 million the year before.
Although the gross cash unit margin improved by 5.6% to USD75 per thousand litres from USD71, this was more than offset by volumes falling by 6.7% to 2.49 billion litres from 2.67 billion the prior year.
In the Retail segment, volumes remained lower year-on-year, but improved as restrictions gradually eased. Commercial segment volumes were down, as restrictions on international travel and the end of a material supply contract hampered Aviation and Marine volumes, Vivo said.
Although Vivo had withdrawn its recommendation to pay its 2019 final dividend of 2.65 pence per share, its balance sheet has remained strong despite the pandemic, leading to the company declared an interim dividend of the same amount.
Looking ahead, Vivo said it is encouraged by its resilient performance during the quarter, and is cautiously optimistic for the rest of 2020 and into 2021.
"Mobility restrictions eased across our host countries during the third quarter, which has led to a strong improvement in gross cash profit, demonstrating our resilience and the integral nature of our products to economies across Africa. We are encouraged by the recent performance, which coupled with the strength of our balance sheet has enabled the board to restart dividend payments. We remain cautiously optimistic and believe that with our diversified and resilient business model, and attractive long term growth opportunities across Africa, we are well positioned for the future," said Chief Executive Officer Christian Chammas.
Shares in Vivo Energy were up 1.8% at 73.00 pence in London, while its Johannesburg shares remained untraded at ZAR15.25 on Friday.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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