EXPANSION

Fellow shareholders, our company started with an initial storage capacity of about 35m litres of petroleum products. In keeping with our policy of expansion, we refurbished the old tanks we inherited from Unilever Plc to bring the total storage capacity now at about 50m litres. Management has started holding talks with our technical partners on the construction of new terminals.

It will interest you to know that your company expressed interest for the acquisition of any of the slated for privatization. Management is also interested in acquiring some of the existing oil terminals whenever the NNPC depots are designated for privatization.

A service fuel dump was put in place in the last quarter of 2005 and it is expected to be operational in the first quarter of 2006. When fully operational, it will perform dual role of meeting our marketers' fuel demand especially for diesel and help the marketers to get AGO for their trucks at a very affordable price.

We have also initiated the policy of branding and identification of retail outlets throughout the country. Before the end of year 2006, the branded trucks and retail outlets would have been in existence. We have also concluded plans with our technical partners on the complementary liquefied petroleum gas [LPG] terminal and I am pleased to inform you that by the 2nd quarter of 2006, the preliminary paper works on the site would have been completed.

OPERATING RESULTS

Distinguished shareholders, during the last AGM, your company announced a turnover of N4.85b and a profit after tax of N82.5m as a result of the management's aggressive marketing strategies from a modest operation of 5 months and 2 weeks. However, I have the pleasure to inform you that during the year under review, your company made a turnover of N16.2b and a profit after tax of N341.1m. The company dispensed 305m liters of petroleum products representing 25% of our installed capacity. This is a very significant improvement and rather delightful considering the harsh environment we operated in. It also means that we are emerging stronger, bigger and more committed to excellent services.

Operating expenses during the period stood at N497.727m representing about 3.07% of our turnover. Most of these expenses are due to depreciation which stood at N319.5m as the plant being a new one, would have to make adequate provisions for this in line with standard accounting principles.

My fellow shareholders, I equally have the pleasure to inform you that due to numerous marketing strategies and purposeful management prudence, the operating result for the year under review has shown tremendous improvement. The result before you has confirmed the resolve of the Board and management to brace all odds in achieving superior shareholders' value in the industry.

Dear shareholders, fellow Directors, in view of the improved performance, the Board of Directors is proposing a total dividend of N46.92m translating into 25k per share from the profit after tax. Management has retained the sum of N351 m as retained profit to strengthen our working capital requirement.

FUTURE PROSPECTS/CONCLUSION

Fellow shareholders, I want to assure you that the future of your company has become brighter than ever in the light of our enhanced relationship with NNPC as we now receive significantly increased allocations as and when due unlike in the past. The Board is poised to make the company a force to reckon with in the country.

Our focus in the new dispensation is to build a formidable petroleum company that would fit better in the energy reforms of the government while delivering greater value to both our customers and the shareholders.

We are working out a conducive environment in the first quarter of 2006 where by the company would venture into the acquisition of retail outlets. We also look forward to an environment where your company can economically import petroleum products and assist the government in achieving its policy of uninterrupted products availability and affordability.

Distinguished shareholders, on behalf of the Board of Directors, I wish to thank most sincerely our esteemed customers, whose continued confidence and patronage have sustained our impressive performance over the year. I cannot thank the management and staff enough for their hard work and dedication to duty. The impressive result you have seen bears good testimony to the level of their commitment and dedication.

May I also on behalf of the Board, thank our valued shareholders for the confidence reposed in the Board and the company especially the massive support in the last one year. I want to assure you all of our commitment in the quest for increased returns on your company investments. I also assure you that your company will continue to grow and be a great leader in the downstream petroleum sector in Nigeria . I want to extend my profound gratitude to the relevant government agencies like NNPC, PPMC, PPPRA, DPR and PEF for their continued support to our great company.

I thank you all for your kind attention, and May the Almighty God continues to keep us together as one united family.