Angola | Sonangol needs to undergo financial restructuring

Sonangol’s headquarters in Luanda

Angolan state oil company Sonangol needs to undergo financial restructuring and USD1.569 billion to guarantee payments until the end of this year, said on Thursday in Luanda the chairman of the Board of Directors, Isabel dos Santos.

Dos Santos also said that revenues from Sonangol have been falling since 2013 “without operating costs falling in line with this drop, “she estimates gross revenues of $15.325 billion and that this year the company will not pay dividends to the State.

“Sonangol’s gross revenue in 2013 was $40.070 billion, in 2014 was $24.657 billion, in 2015 it was $16.212 billion and this year, 2016, we estimate gross revenues of $15.325 billion,” according to a statement issued by the company.

The statement added that “at the same time the company’s operating costs have not fallen as much as the drop in revenue, estimated at $11.957 billion in 2016, a decrease compared to $14.443 billion in 2015.”

Isabel dos Santos was appointed to chair Sonangol last June and last week revealed that the valuation carried out since then, for “full knowledge of the initial situation,” detected “inconsistencies between the accounts and the real information of the company” and “a lack of control over various investments.”

The Chair of the Board of Directors even said that the situation, “is much more serious than scenario originally outlined,” forcing “management decisions as a matter of urgency.”

The financial debt of the group for 2016 is estimated at $9.851 billion, there is currently “a need to take on new financing” based on financial commitments “yet to be funded,” so that Sonangol “can make payments until the end of the year, “a need that totals $1.569 billion.”

The management of Sonangol was led from 2012 until the appointment, in June 2016, of Isabel dos Santos, by Francisco de Lemos Jose Maria, who in turn succeeded Manuel Vicente, who was then became vice president of Angola.

Isabel dos Santos also said an “oversizing of the structure” of the group had been detected, with about 22,000 people linked to Sonangol, 8,000 active workers, more than 1,100 non-active workers and more than 8,000 workers from temporary employment agencies.

The statement said that the investment portfolio is currently characterized by problematic projects such as the Lobito Refinery and the Barra Ocean Terminal and large investments with no return, outside of Sonangol’s core business, namely investments in areas such as health, hospitality, real estate and renewable energy.  MDT/Macauhub