Capital Oil Plc has made available its Audited Financial Statement for 2016 Accounting year available with Nigerian Stock Exchange last week. The report shows that the company had a negative EPS for four consecutive years. This has severely affect the stock price of Capital oil as it share price remain stagnant for more than a week.

Capital oil shares has not been active in the the Market also. The five year financial summary (extract) of the company is stated below. The figures are stated in 'millions
Item 2016 2015 2014 2013 2012
Turnover 840 1.132 2.106 2.967 1.901
PAT/LAT (294) (61) (131) (475) (23)
CA 155 432 463 557 876
CL 152 154 161 256 607
Long TD 624 621 605 554 --
Equity 1.464 1.464 1.464 1.464 618
Net Asset 420 760 822 950 1.425
Specific ratios of this Capital Oil PLC are stated below;
2016 2015 2014 2013 2012
EPS/LPS (0.12) (0.03) (0.05) (0.05) 0.01
NAPS (k) 0.17 0.31 0.33 0.38 0.66
ROI (70%) (8.1%) (16%) (50%) (1.6%)
CR 1.02:1 2.80:1 2.87:1 2.17:1 1.44:1
Lev 1.49 0.82 0.74 0.58 --

Interpretation

EPS symbolises Earnings per Share, LPS means Loss Per Share. NAPS is Net Assets per share. ROI means Return on Investment. CR is for current ratio and Lev is leverage.

The company EPS was negative for four consecutive years. For 2012, the EPS was 1kobo, a positive figure. Also, there was no long term debt on that date. The company involving itself on debt may has triggered the negative EPS. This is true because, a company should not include debts in its capital structure unless the EPS is higher than the interest on loan so as to avoid financial risk.

The company do not has a good prospect since its leverage is very low. It leverage for 2017 is 149%. This means that its long term debts is 49% higher than it's Net worth. Though, its Equity can pay up the long term creditors.

However, there may be a way out for the company. Especially, if the prices of crude oil surge.
http://www.myfinancein.com/2017/04/capital-oil-negative-eps-four-years.html