total nigeria plc...total nigeria plc was incorporated in 1956 and was listed on the nigerian stoc k...

TOTAL NIGERIA PLC

ANNUAL REPORT

31 December, 2018

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Table of Contents Corporate Profile ................................................................................................................................................ 2 Mission Statement ............................................................................................................................................. 3 Directors, Officers and Professional Advisers ............................................................................................... 4 Corporate Directory ........................................................................................................................................... 5 Results at a Glance ............................................................................................................................................ 6 Notice of Annual General Meeting ................................................................................................................... 7 Chairman’s Statement ....................................................................................................................................... 9 Board of Directors Profile ............................................................................................................................... 12 Report of the Directors .................................................................................................................................... 15 Corporate Governance Report........................................................................................................................ 21 Statement of Directors Responsibilities ........................................................................................................ 22 Report of the Statutory Audit Committee .....................................................................................................34 Report of the Independent Auditors..............................................................................................................35 Statement of Financial Position.....................................................................................................................41 Statement of Profit or Loss and other Comprehensive Income..................................................................42 Statement of Changes in Equity.....................................................................................................................43 Statement of Cash Flows................................................................................................................................44 Notes to the Financial Statements.................................................................................................................45 Other National Disclosures.............................................................................................................................82 Share Capital History......................................................................................................................................86 List of Major Distributors................................................................................................................................87

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CORPORATE PROFILE Total Nigeria Plc was incorporated in 1956 and was listed on the Nigerian Stock Exchange in 1979. Our first petrol station was commissioned at Herbert Macaulay Street, Yaba, Lagos in 1956. Today we have over 575 service stations and 3 lubricants blending plants. We operate 5 aviation storage facilities and have other facilities spread across the country. We are a market leader, reference point and pacesetter in the downstream sector of the Nigerian oil and gas industry. Total S.A. which holds 62% of Total Nigeria Plc is a publicly-traded oil company with businesses in exploration and production, refining, marketing, trading and more recently, solar. It is also a major player in the chemicals sector. Total S.A.’s oil and gas production of more than two million barrels of oil equivalent per day is underpinned by proven reserves of more than eleven billion barrels of oil equivalent and a portfolio of geographically diversified assets that is among the fastest growing in the industry. As Europe’s leading refiner and marketer, the Total Group directly operates 6 refineries; its retail network comprises over 16,000 service stations mainly in Europe and Africa which distribute motor fuels, lubricants and LPG under the internationally recognized TOTAL brand.

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TOTAL NIGERIA PLC RC 1396

Mission Statement We are in business to ensure total customer satisfaction by the creation of quality products and services delivered with a strong commitment to safety and respect for the environment. This objective drives all our corporate actions and the mutual acknowledgement of them by our partners forms the basis for our business relationships. To sustain this objective and our leadership of the market, our commitment is to build and sustain a work culture firmly rooted in professionalism, respect for employees, internal efficiency and dedicated services.

Imrane Barry Managing Director

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TOTAL NIGERIA PLC COMPANY REGISTRATION NO. 1396

DIRECTORS, OFFICERS AND PROFESSIONAL ADVISERS* DIRECTORS

Mr. S. Mittelman - Chairman (French) Mr. I. Barry - Managing Director (Guinean) Mr. B. Dormoy - Executive Director (French) Chief F. Majekodunmi - Non Executive Director Ms. T. Ibru - Non Executive Director Engr. A.R. Sirajo - Non Executive Director Mr. O. Hahn - Non Executive Director (French) Prince (Dr.) J. Nnamani - Non Executive Director Mr. A. Adotevi - Non Executive Director (Dutch)

COMPANY SECRETARY

O. A. Popoola-Mordi REGISTERED OFFICE

Total House 4 Churchgate Street, Victoria Island, Lagos. Telephone No. 01 4617041-2 REGISTRARS

CardinalStone Registrars Limited 358 Herbert Macaulay Way, Yaba, Lagos. Telephone No. 01 7120090, 01 7924462 AUDITORS

KPMG Professional Services KPMG Tower, Bishop Aboyade Cole Street, Victoria Island, Lagos. Nigeria Telephone No. 01 2718955 BANKERS

Access Bank Plc Citibank Nigeria Limited Diamond Bank Plc Ecobank Nigeria Limited. First Bank of Nigeria Ltd. Guaranty Trust Bank Plc Stanbic IBTC Bank Plc Standard Chartered Bank Nigeria Limited Union Bank of Nigeria Plc United Bank for Africa Plc Wema Bank Plc Zenith Bank Plc

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CORPORATE DIRECTORY HEAD-OFFICE

TOTAL HOUSE AIR TOTAL 4, Churchgate Street, IKEJA Victoria Island, Lagos. JUHI P.M.B 2143, Lagos ABUJA Tel: 08113624144 Tel: 01 4631681-4 01 4617041 – 2 TOTAL CARD: 01- 4617044 TERRITORIAL OFFICES

WESTERN EASTERN Total Nigeria Plc Total Nigeria Plc 6, Bonny Road, Apapa, Lagos. Plot 124, Trans-Amadi

Tel: 01- 4618913 Industrial Layout, Port-Harcourt. Tel: 01- 4619180 NORTHERN Total Nigeria Plc Total House,

Plot 247, Herbert Macaulay Way, Central Business District, Abuja. Tel: 01- 4618914 SALES AREA OFFICES ABUJA KANO Total Nigeria Plc Total Nigeria Plc. Total House 181, Airport Road, Plot 247, Herbert Macaulay Way. P.O.Box 21, Kano. Central Business District, Abuja Tel: 01- 4619183

Tel: 01- 4618914

BENIN LAGOS SOUTH

Total Nigeria Plc Total Nigeria Plc 8/10, Akpakpava Street 6, Bonny Road, Apapa, Lagos P.O.Box 20, Benin City. Tel: 01- 4618913 Tel: 01- 4619189 IBADAN LAGOS NORTH Total Nigeria Plc Total Nigeria Plc Mokola Roundabout 3, Steve Ajose Street P.O. Box 868, Ibadan Former SCOA Yard, Tel: 01- 4619188 Behind Elida Hotel, Kirikiri, Lagos Tel: 01- 4619182 KADUNA PORT HARCOURT Total Nigeria Plc Total Nigeria Plc 2, Kachia Road, NO. 59 Trans Amadi Industrial P.O.Box 1433, Kaduna Layout, Port Harcourt. Tel: 01- 4619180

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TOTAL NIGERIA PLC

RESULTS AT A GLANCE FOR THE YEAR ENDED 31ST DECEMBER

2018 2017 Change

₦'000 ₦'000 %

Revenue 307,987,896 288,062,650 7 Profit before taxation 12,098,463 11,795,283 (3)

Profit for the year 7,960,893 8,019,298 (1)

Share capital 169,761 169,761 -

Shareholders' funds 30,730,889 28,225,551 9

Total dividend 5,771,870 5,771,870

Interim dividend - paid 1,018,566 1,018,566

Final dividend - proposed 4,753,306 4,753,306

Dividend declared 4,753,306 2,376,652

2018 2017 Change

PER SHARE DATA: %

Based on 339,521,837 ordinary

shares of 50 kobo each:

Earnings per 50 kobo share (Naira) - basic 23.45 23.62 (1)

Dividend per 50 kobo share (Naira)1 17.00 17.00

Dividend cover (times) 1.38 1.39 (1)

Stock exchange quotation (Naira) 203 299.95 (12)

Number of staff 461 469 (2)

1Interim dividend of ₦3.00 per share was paid during the period. At the board of directors meeting of 28th March, 2019, a final dividend of ₦14.00 was proposed for the year ended 31 December, 2018 (2017 :₦14.00)

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TOTAL NIGERIA PLC NOTICE OF ANNUAL GENERAL MEETING NOTICE IS HEREBY GIVEN that the Forty – First Annual General Meeting of TOTAL NIGERIA PLC will hold at The Africa Ballroom Lagos Continental Hotel, 52A Kofo Abayomi Street, Victoria Island, Lagos on Thursday, the 27th day of June, 2019 at 11.00 a.m. to transact the following: ORDINARY BUSINESS: 1. To lay before Members for approval, the Financial Statements for the year ended 31st December, 2018

and receive the Reports of the Directors, Auditors and Statutory Audit Committee thereon; 2. To declare a final dividend; 3. To re-elect Directors;

4. To appoint Directors;

5. To authorize the Directors to fix the remuneration of the External Auditors; and 6. To elect members of the Statutory Audit Committee. SPECIAL BUSINESS: 1 To fix the remuneration of the Directors.

2. To renew general mandate for Related Party Transactions.

BY ORDER OF THE BOARD

OLUBUNMI POPOOLA-MORDI Company Secretary FRC/2013/ICSAN/00000002042 28th March, 2019 Registered Office TOTAL HOUSE 4 Churchgate Street, Victoria Island, Lagos, Nigeria.

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NOTES: I. PROXY

A member of the Company entitled to attend and vote at the meeting who is unable to attend the meeting and wishes to be represented at the meeting is entitled to appoint a proxy to attend, speak and vote in his/her stead. A proxy need not be a member of the Company. A Proxy Form is enclosed herewith, and if it is to be valid for the purpose of the meeting, it must be completed and duly stamped by the Commissioner of Stamp Duties and deposited at the office of the Registrars, CardinalStone Registrars Limited, 358 Herbert Macaulay Way, Yaba, Lagos not less than 48 hours before the time of the meeting.

II. PAYMENT OF DIVIDEND

If the payment of a dividend is approved and declared by members at the Annual General Meeting, the dividend warrants will be posted or the accounts of shareholders whose names are registered in the Company’s Register of Members as at close of business on Friday 19th April, 2019 will be credited on Friday 14th June, 2019.

III. CLOSURE OF REGISTER AND TRANSFER BOOKS

Notice is hereby given that the Register of Members and Transfer Books of the Company will be closed from Tuesday the 23rd day of April, 2019 to Monday the 29th day of April, 2019 both days inclusive for the purpose of preparing an up-to date Register of Members.

IV. BIOGRAPHICAL DETAILS OF DIRECTORS

The biographical details of the Directors standing for re-election and appointment are provided in the 2018 annual report and posted on the Company’s website www.total.com.ng

V. NOMINATION OF MEMBERS OF THE STATUTORY AUDIT COMMITTEE

Pursuant to Section 359 (5) of the Companies and Allied Matters Act (CAP C20) Laws of the Federation of Nigeria, 2004 any member may nominate a shareholder for election as a member of the Audit Committee by giving notice in writing of such nomination to the Company Secretary at least 21 days before the Annual General Meeting. Nominations should please be accompanied by a copy of the nominee’s curriculum vitae.

VI. RIGHT OF SHAREHOLDERS TO ASK QUESTIONS

Shareholders have a right to ask questions not only at the meeting but also in writing prior to the meeting and such questions must be submitted to the Company Secretary on or before the 6th day of June, 2019.

VII. UNCLAIMED DIVIDEND WARRANTS AND SHARE CERTIFICATES

Several dividend warrants and share certificates remain unclaimed, and are yet to be presented for payment or returned to the Registrars for revalidation. We implore any shareholder affected by this to please write to the Company Secretary or Registrars or call at either office during working hours.

VIII. e-DIVIDEND

In accordance with the Securities and Exchange directives, Shareholders are hereby advised to open bank accounts, stockbroking and CSCS accounts for the purpose of timely receipt of dividend payments. A detachable application form for e-dividend is attached to this Annual Report to enable all shareholders furnish particulars of their bank accounts/CSCS details to the Registrar or Company Secretary expeditiously.

IX. e-REPORT

In order to improve delivery of our Annual Reports, we have inserted a detachable form to this Annual Report and are requesting shareholders who wish to receive the Annual Report in an electronic format to complete and return the form to the Registrars or Company Secretary for further processing.

X. SEC RULE ON COMPLAINTS MANAGEMENT FRAMEWORK

Please note that in accordance with the Securities and Exchange Commission rule No. 10 (a) shareholders who have complaints should use the electronic complaints register on the website of the company at www.total.com.ng to register their complaints. This will enable the company handle complaints from shareholders’ in a timely, effective, fair and consistent manner. The electronic version of the Annual Report and Accounts 2018 is available on the Company’s website www.total.com.ng.

http://www.total.com.ng/


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CHAIRMAN’S STATEMENT AT THE 41ST ANNUAL GENERAL MEETING OF TOTAL NIGERIA PLC INTRODUCTION Good morning distinguished shareholders, members of the Board of Directors of Total Nigeria Plc, esteemed customers, gentlemen of the press, invited guests, ladies and gentlemen, it is with great pleasure that I, on behalf of the Board of Directors of Total Nigeria Plc welcome you to the 41st Annual General Meeting of your Company. During the course of this meeting, I shall present to you the Directors’ Report and Financial Statements for the year ended 31st December, 2018. THE BOARD Since our last Annual General Meeting, there have been changes to the composition of the Board. Mr. Jean-Philippe Torres and Mr. Fabien Colmet-Daage resigned from the Board as they took on new roles in the Total Group. We thank Messrs. Torres and Colmet- Daage for their contributions to the Board and Company. In July, 2018 Mr. Imrane Barry was appointed Managing Director whilst Mr. Alexander Adotevi was appointed a Non-Executive Director in October 2018. At this meeting, we shall be asking you to ratify their appointments. Please join me in wishing Messrs. Barry and Adotevi a very successful tenure on the Board. OUR ENVIRONMENT As you all are aware, 2018 was quite a challenging year for the Company, the downstream petroleum sector and country at large. Some of the key challenges include security issues (such as robberies, kidnapping, clashes between herdsmen and farmers which continue to impact negatively on agricultural production), heavy floods which have affected many farming communities, delayed payment under the Petroleum Support Fund scheme, high cost of investment, reduced capital inflows and weakening crude oil prices (due to anticipated global supply glut as the year came to a close). The regulatory environment continues to be demanding with the proliferation of taxes across the federal and local levels. Importation of PMS was very difficult as the landing cost was higher than pump price and for most of the year, NNPC assumed the role of sole importer of Premium Motors Spirit (PMS), importing about 91% of the country’s consumption. PMS unit margin is still a major source of concern as it remains grossly inadequate in comparison to rising costs of operations and investment. The pattern remained the same as in the previous year; we have continued to experience late payment of subsidies and late payment of the interest and foreign exchange differential element of same. This has placed a huge financial burden on your Company. The CBN official Foreign Exchange rate which is applicable only to white products remained relatively stable between ₦305-₦306 whilst Interbank (NIFEX) hovered between ₦ 331.16 - ₦362.7. 2018 was a year of recovery from a recession that set back economic growth in the country from the penultimate year. Average inflation for 2018 stood at 12.15%. On the whole, economic growth in 2018 remained fragile as real Gross Domestic Product grew at an annual rate of 1.93%. COMPANY PERFORMANCE The Company has continued to experience sustained pressure on its cashflows due to late payment of subsidies resulting in huge financial expenses (high and unanticipated interest charges). All of these add significant costs to doing business, had negative impact on our sales and affected our profitability. In spite of the difficult terrain, our results are indicative of the commitment of the board and management to growing shareholder values irrespective of operating challenges. The Company’s turnover increased from ₦288 Billion in 2017 to ₦307 Billion at the end of 2018. Profit after tax remained stable at ₦7.96 Billion compared to ₦8.01Billion in 2017. DIVIDENDS The Company had earlier distributed the sum of ₦1.02 Billion as interim dividends, representing ₦3.00 (Three Naira only) per share for the year ended 31st December, 2018. Given the challenges which I stated earlier, the Board proposes for approval by shareholders the sum of ₦4.75 Billion representing another ₦14.00 (Fourteen Naira only) to be distributed as final dividend for the year 2018 subject to the deduction of appropriate withholding taxes at the time of payment.

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In line with our corporate reputation for early disbursement of shareholders’ dividends, we are delighted to confirm to you that if approved at this meeting, your dividends will be paid on the 28th of June, 2019. OUR PEOPLE

Employees of Total Nigeria Plc are its most valuable asset and remain the differentiating element between us and our competitors. In 2018, we successfully concluded the healthy living campaign with a focus on Work-Life Balance and 85% of our staff participated in various forms of training during the year. Considering the challenges and uncertainties of the global economy we believe that your Company performed creditably and this is a testament to the passion and commitment of her staff. Our people continue to show unwavering steadfastness to the growth of our business. We shall continue to invest in the development of our people and particularly support the advancement of diversity in the workplace. I am confident that our structure and workforce will enable delivery of excellent returns to our shareholders in 2019 and beyond. On behalf of my colleagues on the Board of our great company and you the shareholders, I hereby express our appreciation to the management and staff of the Company for their dedication, unwavering loyalty and commitment to the Company. KEY DEVELOPMENTS Safety remains our core and number 1 value. Our areas of focus are Safety, Health, Quality and Environmental Protection across all of our operations. We have achieved zero fatalities in the year under review. Our team also implemented a revolutionary idea called the Route Survey where all our approved routes are pre-programmed in an On Board Computer device and it warns the driver of road hazards ahead. We have also recently started the installation of a Truck Rollover Alarm System in our trucks that activates a loud audio alarm and voice message when a truck begins to rollover. We remain vigilant and committed to Road Transport Safety. We maintained our certification status for ISO 9001:2015 and ISO 14001:2015 quality and environment standards. We are also very proud to say that all our Plants and Depots maintained all their certifications. To guarantee our import and logistics optimization, we entered into a storage arrangement in Lagos area which will allow us to capture opportunities. We signed a 15 year Power Purchase Agreement with a manufacturing company in Ogun State to provide 999kWp Solar Hybrid Solution. Fifty stations are now powered by solar energy, with a combined capacity of 1 MW and we produced more than 1 gigawatt hour of clean electricity. Our investments in our blending plants yielded positive results as we saw the sales of our lubricants reach unprecedented heights.

In our retail business we now have 575 stations and opened additional Café Bonjour shops. We have also re-designed over 50 Shops nationwide and look forward to taking the new fascia to every T-Air station in Nigeria. We sold over 73,000 solar lamps, deployed Total Quartz Auto Service concept at 20 lube bays and installed 9 Total Jet Wash (car wash) in our stations. Our One-Stop-Shop strategy has been successful, with a 20% increase in Shops Food and Services alone and we also successfully launched the BtoC Total card offer with top up available at ATMs nationwide and online through totalcard.com.ng. In recognition of our support to the growth of the Downstream Oil and Gas industry we were presented the prestigious Award of Honour at the OTL Africa Downstream Expo, the Oil and Gas Corporate Social Responsibility /Sustainability award by the Guardian Newspaper, an Award for Excellence in Corporate Governance by the Institute of Chartered Secretaries and Administrators and also the 20 Years of Dividend payments as a quoted company by the Third Observers Nigeria Limited. . THE FUTURE According to the World Bank, global growth is expected to slow to 2.9% in 2019 and growth in Nigeria is expected at 2.2% in 2019, assuming that oil production will recover and a slow improvement in private demand will constrain growth in the non-oil industrial sector. We envision that the year will present its own challenges but, I believe we are well positioned to overcome the challenges of the business environment. We envisage that 2019 will provide us with opportunities for growth and investment.

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CONCLUSION We remain a brand of reference and leading energy solutions provider. We hope to progress with the undiminished support of all our stakeholders and the unwavering commitment of our people. With all this in place, we expect to consolidate on our past achievements and deliver value to our shareholders and other stakeholders. . I would also like to thank my colleagues on the Board for their support and commitment. Our gratitude also goes to our customers, transporters, suppliers and other stakeholders. We thank you for your patronage, cooperation and contributions to achieving the results for the year 2018. Finally, I thank you all for your presence at this Annual General Meeting, and I look forward to your participation in this meeting.

Mr. STANISLAS MITTELMAN Chairman

28th March, 2019

.

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BOARD OF DIRECTORS PROFILE

MR. STANISLAS MITTELMAN: Mr. Mittelman graduated with a Master’s degree from EDHEC Lille Business School in France. He previously worked as a Salesman in Network stations in Paris and was transferred to Nigeria to head the project team that upgraded over 400 network stations in Nigeria. He served in Vietnam as TOTAL’s representative in an LPG joint venture and was posted to work as General Manager, TOTAL Zimbabwe and then as General Manager (Specialties), in the UK, a position he held before his appointment in 2007 as Executive Vice President for West Africa and Chairman of all subsidiaries in West Africa. In 2012 he was appointed Vice President Strategy Division Total Marketing and Services in charge of Mergers, Acquisitions and Corporate Planning. In 2015, he was appointed Vice President Total Marketing, France and in 2016 he was appointed Senior Vice President Africa Middle/East and a director of Total Nigeria Plc. He was appointed to the Board on the 15th of April, 2016. He is the Chairman of the Board.

MR. IMRANE BARRY: Mr. Barry holds a Degree in Civil Engineering from Ecole Nationale Supérieure des Traveux Publics- ENSTP (Cote d’Ivoire). Prior to joining Total, Mr. Barry worked in several capacities in Engineering and Construction Companies in Guinea Conakry, Cote d’Ivoire and Gabon. In 1996 he joined Elf and from 1996 to 2000, he served as Operations Manager in Guinea and Engineering and Operations Manager in Kenya. Between 2000 and 2002, he served in Totalfinelf Guinea as Operations Manager. From 2002 to 2012 he served as Operations Manager in Total Cote d’Ivoire, Technical and Transport Director in Total DR Congo and Strategy-Development Senior Officer in Total Paris. Mr. Imrane Barry became the Deputy to the Executive Vice-President Total West Africa in 2012. He was appointed Managing Director of Total Uganda in 2013 and Managing Director of Total Cameroon in 2015. Mr. Barry was appointed to the Board of Total Nigeria Plc. on the 25th of July, 2018. He is the Managing Director.

Mr. BRUNO DORMOY: Mr. Bruno Dormoy is a graduate of CSG Business School, Paris in France and has a Masters of Marketing degree from Lovanium International Management Centre, Belgium. He started his career in 1984 in Fina France as a Treasury Assistant. By 1995 he had risen to become the Administrative and Financial Manager in the lubricant division of Fina France. In 1999 he became the Customer Service Manager Air Total in the Refining and Marketing Division, a position he held until year 2000 when he was appointed the IT Business Manager in the Business and Development Department at Air Total. In 2003, he moved to Total Poland as Chief Financial officer, a position he held until 2007 when he was transferred to Spain as Chief Financial Officer. In 2012 he was appointed Vice President, Control Finance and Performance, Europe Division. Mr. Dormoy was appointed as an Executive Director of Total Nigeria Plc. on the 8th of December, 2016.

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CHIEF FELIX MAJEKODUNMI: Chief Felix Majekodunmi obtained a first degree in Mechanical Engineering from the Thames Polytechnic (Greenwich University) London in 1974, and a Certified Diploma in Accounts and Finance (CDipAF) London in 1986. Chief Majekodunmi began his career in 1974 as Operations Engineer with the British Petroleum (BP) Nigeria Ltd. Thereafter, he held various managerial positions in BP. He joined Total Nigeria Plc in 1985 as the Supply and Distribution Manager and rose to the position of Chief Operating Officer. In 1998, he was appointed the Managing Director (MD) and Chief Executive Officer (CEO) Total Tanzania Ltd., a position he held until 2001 when he was appointed the MD and CEO, Total Ghana Ltd. He subsequently became the Managing Director and Chief Executive Officer for Mobil Ghana Ltd, Total Petroleum Ghana Ltd and Total Kenya Ltd respectively. He is a member of several professional bodies including the Institute of Mechanical Engineers (United Kingdom) and the Nigerian Institute of Engineers. He currently runs his private business. He was appointed to the Board on the 16th of November,2010.

MS. TEJIRO IBRU: Ms. Tejiro Ibru obtained a Masters in Engineering and a Masters in Finance from Imperial College, London and started her career with Deloitte & Touche Petroleum Services Group, London. In 2005, she joined Oceanic Bank International Plc as Head of the International Banking Group and later as Head of the Project Management Office. In 2010, she was appointed the Head of Corporate Services of Destiny Dredgers International Limited and in 2014 she joined Dorman Long Engineering Limited as Head of the Programme Management Office. From 2015 to 2017, she worked at Midwestern Oil and Gas Company Limited as a Corporate Finance Analyst. She is an Associate of the Royal School of Mines, Imperial College. She was appointed to the Board on the 27th of October, 2011.

ENGR. RUFA’I SIRAJO: Engr. Rufa’i Sirajo obtained a National Diploma in Electrical/Electronic Engineering from the Federal Polytechnic Mubi, Adamawa State, a Higher National Diploma in Electronics/Telecommunications Engineering from Kaduna Polytechnic, Kaduna State, a Post Graduate Diploma in Electrical Engineering from Bayero University, Kano and an MBA degree from the University of Calabar. He commenced his working career in 1986 as Engineering Superintendent (Electrical) at Geotechnical Services Limited from where he moved on to Northern Cables Processing and Manufacturing Company Limited as Quality Control Supervisor. He is currently the Managing Director/Chief Executive Officer of Afri-International Projects Consulting Limited. He is registered with The Council for the Regulation of Engineering in Nigeria (COREN); he is a Member of the Society of Engineers (MNSE), and is also a Member of the Solar Energy Association of Nigeria. He was appointed to the Board on the 28th of March, 2012.

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MR. OLIVIER HAHN: Mr. Olivier Hahn is a graduate of Process Engineering from the Ecole Nationale Superieure de Chime de Paris and obtained a Masters degree in Management and Economics from IFP School. He started his career in 1999 with Elf Aquitaine as a Refining Economist and he became the Refining Controller in 2000 after the merger of Total Fina with Elf, a position he held until 2001 when he moved to Total Refining and Marketing SA division in Paris as Provence Refinery Senior Pilot in 2002, a position he occupied until he was made the Strategy/Business Development Manager in 2006. Between 2009 and 2011 he was the Project and Corporate Finance Senior Manager Total S.A. He became the Vice President Mergers & Acquisitions for the Group in 2012, a position he held until he was appointed Vice President Supply & Logistics for Africa in 2017. He was appointed to the Board on the 10th of March, 2017.

PRINCE (DR.) JEFFERSON NNAMANI: Prince Jefferson Nnamani is a graduate of Political Science and Administration with a Masters in Public Administration (MPA) from the University of Maiduguri, Borno State, Nigeria. In his over 29 years career with Total Nigeria Plc, he served the Company in various capacities starting as a Sales Representative in Borno State, Industrial Sales Executive in Lagos, Senior Network Inspector, Lagos Region, Sales Executive, Eastern Region, Regional Manager North Central, Regional Manager, Lagos and Western Region, Territorial Sales Manager, West, General Manager, Sales and in 2011 he was appointed General Manager Strategy, a position he held until his appointment in 2015 as Executive Director, Strategy. He retired in December, 2017. Jeff has also served on the Board of Nicon Insurance Corporation and the Governing Council, Yaba College of Technology. Jeff is a fellow of the Institute of Credit Administrators of Nigeria and a Member of the Institute of Directors of Nigeria. He currently runs his private business. He was appointed to the Board as a Non Executive Director with effect from the 16th of December, 2017.

MR. ALEXANDER ADOTEVI: MR. ALEXANDER ADOTEVI: Mr. Adotevi holds a Degree in Economics from Universite de Paris ii Licence in Paris and is qualified as a Chartered Accountant from the Chartered Institute of Management’s Accountant’s (CIMA) in London, UK . Before joining Total, he worked in finance and strategy roles in the UK at firms in various sectors including semi-conductors, transportation and in professional services. He joined Total UK Ltd in 2009 as a Finance Manager, and between 2011 and 2018 he served as the Finance Director initially of Total Nederland NV in The Hague and then of Total Deutschland GmbH in Berlin. In 2018, he was appointed Vice President Corporate Finance & Project Finance, Downstream (MS/ RC) in Total SA in Paris. Mr. Alexander Adotevi was appointed a non Executive Director of Total Nigeria Plc with effect from the 25th of October, 2018.

REPORT OF THE DIRECTORS

FOR THE YEAR ENDED 31ST DECEMBER, 2018

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TOTAL NIGERIA PLC In accordance with the provisions of the Companies and Allied Matters Act, (Cap C20), Laws of the Federation of Nigeria 2004, the Directors present their Annual Report together with the Company’s Audited Financial Statements for the year ended 31st December, 2018 which discloses the state of affairs of the Company. 1. PRINCIPAL ACTIVITIES The principal activities of the Company are marketing and distribution of refined petroleum products. 2. LEGAL FORM The Company was incorporated as a private limited liability company in 1956 and was converted to a public

limited liability company in 1978. Its shares are currently quoted on the Nigerian Stock Exchange. Under a scheme of arrangement concluded and sanctioned by the Federal High Court of Nigeria on the 11th of September 2001, the Company merged with Elf Oil Nigeria Limited and changed its name to TotalFinaElf Nigeria Plc. To mark the completion of its corporate mergers, TotalFinaElf Group worldwide reverted to its former name TOTAL in 2003. Accordingly, the Company changed its name from TotalFinaElf Nigeria Plc to TOTAL Nigeria Plc in the same year. 61.72% of the Company's ordinary shares were held by Total Societe Anonyme and Elf Aquitaine S.A. until 2013 when a restructuring was concluded and Total Raffinage Marketing became the shareholder of 61.72% of Total Nigeria Plc while the remaining 38.28% are held by some members of the Nigerian public. At an extraordinary general meeting in 2013, Total Raffinage Marketing resolved to change its corporate name to Total Marketing Services.

3. OPERATING RESULTS The following is a summary of the Company’s operating results:

2018 2017

N’000 N’000 Revenue 306,709,284 288,062,250 Profit before taxation 12,306,239 11,795,283 Profit for the year 8,412,436 8,019,297

Dividend 1,018,566 5,771,872

4. DIVIDEND During the year ended 31st December, 2018 the Directors authorized the payment of ₦3.00 (2017: ₦3.00) per

ordinary share of 50 kobo each as interim dividend and hereby recommend to members the payment of a final dividend of ₦14.00 (2017: ₦14.00) per ordinary share of 50 kobo each. The dividend is subject to deduction of withholding tax at the rate applicable at the time of payment.

5. DIRECTORS The directors who served during the year and to the date of this report are: Mr. S. Mittelman - Chairman (French) Mr. I. Barry - Managing Director (Guinean) Appointed 25th July, 2018 Mr. B. Dormoy - Executive Director (French)

Chief F. Majekodunmi - Ms.T.Ibru - Engr. A.R. Sirajo - Mr. O. Hahn - (French)

Prince J.E Nnamani - Mr. A. Adotevi - (Dutch) Appointed Non Executive Director 25th October, 2018

Mr. J-P Torres - (French) Resigned 26th July, 2018 Mr. F. Colmet-Daage - (French) Resigned 18th October, 2018 The names of the current Directors are listed on page 4. Their thumbnail pictures and brief profiles are also indicated on pages 12 to 14.



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6. BOARD CHANGES Since the announcements at the last Annual General Meeting, Mr.Jean-Philippe-Torres and Mr. Colmet-Daage resigned from the Board. In July, 2018 Mr. Imrane Barry was appointed Managing Director whilst Mr. Alexander Adotevi was appointed a Non Executive Director in October, 2018

7. DIRECTORS TO RETIRE BY ROTATION In accordance with Section 259 (1) and (2) of the Companies and Allied Matters Act, (Cap C20), Laws of the Federation of Nigeria 2004, the Directors to retire by rotation at this Annual General Meeting are Mr. Stanislas Mittelman and Mr. B. Dormoy who, being eligible, offer themselves for re-election. Pursuant to Section 259 (1) of the Companies and Allied Matters Act, (Cap C20), Laws of the Federation of Nigeria 2004, a resolution will be proposed at the Annual General Meeting approving their appointment as Directors.

8. DIRECTORS INTEREST IN SHARE CAPITAL The interests of each Director in the issued share capital of the company as recorded in the register of

Directors’ shareholding, as notified by the Directors for the purpose of Section 275 of the Companies and Allied Matters Act, (Cap C20), Laws of the Federation of Nigeria 2004, and in compliance with the listing requirements of the Nigerian Stock Exchange and the 2011 Securities and Exchange Commission Corporate Governance Code as at 31st December, 2018 were as follows:

Directors 31st December 2018 No. Of shares (Direct)

31st December 2018 No. Of shares (Indirect)

31st December 2017 No. Of shares (Direct)

31st December 2017 No. Of shares (Indirect)

Chief F. Majekodunmi 43,581 - 43,581 -

Ms. T. Ibru 902,903 43,135 902,903 43,135

Dr. J.E Nnamani 100 - 100 -

Ms. Ibru is a shareholder (0.5%) of Mas Makay Limited which owns shares in Total Nigeria Plc 9. DIRECTORS INTEREST IN CONTRACTS None of the Directors notified the Company for the purpose of Section 277 of the Companies and Allied Matters

Act (CAP C20) Laws of the Federation of Nigeria, 2004 of any declarable interest in any contracts involving the Company. However, some of the directors hold positions in other companies with which Total Nigeria Plc had transactions during the current financial year (see key suppliers No.13 below). The selection and conduct of the other companies were in conformity with the rules of ethics and acceptable standards. In addition, Total ensures that such contracts are conducted at arm’s length at all times.

10. PROPERTY, PLANT AND EQUIPMENT Movements in intangible assets and Property, Plant and Equipment during the year are shown in Notes 16 of the Financial Statements. 11. POST BALANCE SHEET EVENTS As at 28th March, 2019 the Directors were not aware of any post balance sheet events which have no been adequately provided for and which could have a material effect on the financial position of the Company as at 31st December, 2017 as well as the profit for the year to that date. . 12. COMPANY'S DISTRIBUTORS The names of the Company's significant distributors are shown on pages 87 to 90. 13. SUPPLIERS Key suppliers of products and materials to the Company are: Total Outre Mer Nigerian National Petroleum Corporation



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LanreBadmus Industries Limited Lotus Plastics Limited 14. INTER-COMPANY TRANSFERS AND TECHNICAL MANAGEMENT AGREEMENTS The Company is a party to a subsisting agreement in respect of License, Marketing know-how and Training.

This agreement is between the Company and Total Raffinage Marketing and Total Outré Mer. The terms of the agreements include: (a) Provision of assistance and advice on the general organization and management of the Company. (b) Provision of suitable expatriate personnel for employment as required and at the request of the Company. (c) Provision of overseas training and retraining for Nigerian employees to enable them assume positions of

higher responsibility within the Company. (d) Product research development assistance. (e) Constructions, engineering and design assistance, provision of accounting and operations computer software,

sample analysis and control. (f) Technical assistance for inventory control, product storage and handling procedures; aviation services

assistance and provision of operational manual to ensure compliance with international standards. (g) Payment of technical assistance and management fees. No accrual/payment was made in 2018. 15. ACQUISITION OF OWN SHARES The Directors affirm that the Company did not purchase its own shares during the year. The employees of

the Company are participants in the Total Group Employees’ shareholding plan. Total Nigeria Plc finances the purchases made by Staff and this is repayable over a number of years.

16. DONATIONS As the Company did in the previous year, donations were made to several charitable organizations during the

year 2018 and the beneficiaries are as follows:

DONATIONS AND SPONSORSHIPS 2018

NAME OF ORGANISATION

AMOUNT IN NAIRA

1 Donation of Educational Tablets to Queen Amina College (Kaduna) 150,000

2 Adonai Orphanage and Widows Center 250,000

3 Christian Mission for the deaf. 250,000

4 Divine Mercy Compassionate Home 250,000

5 FARID Center for People with Special needs 250,000

6 Fatherless & Motherless Children Aid Organisation 250,000

7 Galilee Foundation Ibada, Oyo State 250,000

8 Honour Ground Orphanage Home 250,000

9 International Women's Organisation for Charity 250,000

10 Koko Primary Health Care Center 250,000

11 Lagos Cheshire Home 250,000



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12 Little Sisters of the Poor Home for the Elderly. 250,000

13 Ministry Of Mercy Orphanages 250,000

14 Nigerian Redcross Society Motherless Babies Home, Enugu. 250,000

15 Nigerwives Braille book production centre 250,000

16 Paroche Reachout Foundation 250,000

17 Right Steps Family Outreach in Nigeria (SUSANA HOMES) 250,000

18 Tenderlove Orphanage 250,000

19 The Care People Foundation 250,000

20 Tivid Orphanage Home International 250,000

21 Wesley School 1 for the hearing impaired 250,000

22 Wesley School 2 for the hearing impaired 250,000

23 Donations towards Ikoyi club Golf tournament 250,000

24 FNCCI Gala Dinner Sponsorship 320,000

25 Donation of 265 units of Mosquito Nets to preventive Health Managers 397,500

26 Heart Of Dorcas Children's Center. 500,000

27 Holy Child Motherless Home 500,000

28 Rosalie Home Rehabilitation Center. 500,000

29 Small World/International womens organisation- Silver sponsorship, National Coverage. 600,000

30 Scholarship for Koko Indigenes, Delta State. 1,430,400

31 Job Shadow educational program for students , Delta State, Koko. 3,037,500

32 Cardiovascular Health Disease campaign in Ajah area of Lagos State. 4,331,500

33 World malaria day awareness campaign and capacity building for health workers, distribution of Treated nets in Ibadan, Oyo State 5,753,707

34 HIV/AIDS prevention and awareness campaign, Jos Plateau State. 7,500,000

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Road Safety Cubes Campaign for School Children, across 11 states of Nigeria.

12,000,000

36 Skills Acquisition Program for Youths, Koko, Delta State. 17,528,494

37 SOS children’s Villages Annual Corporate Sponsorship, FCT Abuja, Plateau, Lagos & Ogun States 20,872,152

80,921,253

In compliance with section 38 (2) of the Companies and Allied Matters Act, Cap.20, Laws of the Federation of Nigeria, 2004, the Company did not make any donations or gift to any political party, political association or for any political purpose in the course of the year under review (2017: Nil)

17. EMPLOYMENT AND EMPLOYEES Equality of opportunity, diversity and inclusion are a part of Total Nigeria Plc’s creed. (a) Our Inclusion Policy Total Nigeria Plc is an equal opportunity employer and does not discriminate on any grounds. We support fair

employment practices. We aim to have an institution free from discrimination and based upon the values of dignity and respect. Respect for the employees is at the heart of our organisation and is one of our core values. We encapsulate listening to each other and respecting human rights. In recognition of our commitment



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to respecting human rights the Total group is ranked amongst the top oil and gas major in the Corporate Human Rights Benchmark.

We employ and retain people from a wide range of backgrounds. Our employment policy is free of

discrimination against existing or potential employees on grounds of race, ethnicity, nationality, gender, age, disability, political opinion, competencies, background or faith. We have relevant policies and processes including recruitment, retention, evaluation, remuneration and career planning to ensure they are gender sensitive. We recognise and mitigate unconscious biases in selection and retention processes. It is Total’s policy not to discriminate against physically challenged persons or persons living with HIV/AIDS. The Company continues to pursue its policy of non-discrimination in recruitment and continued employment, offering physically challenged persons career opportunities. The Company had two physically challenged persons in its employment as at the end of the year under review.

(b) Equal opportunities and Diversity The Company recognizes the need for and values diversity and inclusion in its workforce and leadership. We

believe that diversity of our teams is a key success driver. Total is committed to promoting and fostering a culture of equality, diversity, fairness, integrity and dignity. Diversity plays a pivotal role in our employee community. We believe that our diversity in skills and management is a decisive lever for progress. Diversity does make a positive difference and we celebrates the rich diversity of our employees. We have a diversity policy which we actively pursue and propagate and our code of conduct also propagates our positive diversity stance. All employees are given equal opportunities and resources to develop professionally and personally to their full potential.

We have created an open and inclusive corporate culture where all genders can flourish and actively pursue

a feminization policy aimed at developing and empowering our female staff. On the 8th of March, 2018 we joined the world to commemorate the International Women’s Day. We are guided by and continue to develop equal opportunity and diversity policies. Total has also signed the call to action on greater gender equality: “Closing the Gender Gap”

(c) Health, Safety, Environment and Quality Policy Our first core value has remained Safety. Health, Safety, Environment and Quality (HSEQ) protection

continues to be of utmost importance in our operations. Total considers people safety and security, health protection, operational safety, respect for the environment, customer satisfaction and listening to stakeholders as paramount priorities. We are conscious at all levels of the organization, of our personal responsibility and give due consideration to the prevention of accidents, injury, environmental damage or adverse impacts of product and service quality. Health, Safety, Quality and Environmental protection is of utmost importance to us. Our commitment to HSEQ values was unwavering throughout the year despite the challenging environment. We are committed to maintaining the highest standards of safety and enforce strict health and safety rules and practices. We have implemented and operate the Total Group’s Health, Safety, Environment and Quality Charter which places these issues above economic considerations.

Emergency procedures are tested, drilled and updated systematically to ensure optimum performance.

Compliance with these principles remains a crucial element in the performance evaluation of the Company and its employees. Environmental, Industrial and Personal safety continues to be at the core of the Company’s operations in Nigeria. This is applicable in all our offices, depots, outlets, areas of operation and is further extended to our partners and visitors to our offices. We operate a proactive safety culture.

Our commitment to HSEQ values was unwavering throughout the year despite the challenging environment.

We proudly achieved remarkable milestones. As at year end, our Total Rate of Incident Recorded stood at Zero and we recorded no transport or worksite accident in our perimeter. We retained our ISO 9001:2015 and ISO 14001:2015 quality and environment standards.

Total remains committed to Safety For Me, For You, For All.

(d) Welfare of Employees, Staff Development and Training. The Company operates a medical scheme under which free healthcare is provided to employees and their

dependants. We have well equipped clinics at our offices. Employees are mandated to undergo annual medical examinations which form the basis for the provision of timely medical interventions. The Company also periodically runs various health campaigns geared at addressing certain ailments. The 2018 Edition of



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one of such health campaigns was the 13th Healthy Living Campaign held by Total. The focus of the campaign was on work-life balance. The annual healthy living campaign and medical examination for employees and their spouses took place in all the sales areas and head office in November 2018. This was conducted in conjunction with the support of medical professionals. In addition to this, the Company at some of its locations continues to provide aerobic classes and light football workout for staff. On a quarterly basis, staff are invited to partake in a “walk for life” exercise which involves taking long swift walks aimed at maintaining a healthy lifestyle.

We are committed to constantly ensuring that our staff understand their roles and rights. The Company

constantly equips and updates its employees with the skills and knowledge required for the successful performance of their jobs. In 2018, staff participated in various local and international trainings on diverse subjects including HSEQ, Human Rights, Business lines, Management and Personal Development. 85% of the workforce attended at least a class-based training session during the year, and we achieved an average of 5 training days per employee in line with best practices. Furthermore, we encourage our staff to be members of professional institutions which will add value to both themselves and the Company.

18. MAJOR SHAREHOLDINGS. (a) The issued and fully paid shares of 50 kobo each of the Company as at 31st December, 2018, were beneficially

held as follows: 2018

Number of share Holding

2017 Number

of share Holding

‘000 % ‘000 % Total Raffinage Marketing 209,560 61.72 209,560 61.72 Other Shareholders 129,962 38.28 129,962 38.28

339,522 100.00 339,522 100.00

(b) No shareholder, except as disclosed above, held more than 5% of the issued capital as at 31st December,

2018 and as at 28th March, 2019. (c) Range analysis of ordinary shareholdings

Range

No of Holders % Holders Holdings % Holdings

1 - 500 13,317 50.99 2,314,220 0.68

501 - 1,000 3,476 13.31 2,571,685 0.76

1,001 - 5,000 7,211 27.61 15,141,121 4.46

5,001 - 10,000 1,101 4.22

7,579,052 2.23

10,001 - 20,000 540 2.07

7,413,288 2.18

20,001 - 50,000 235 0.90

7,183,830 2.12

50,001 - 100,000 94 0.36

6,767,293 1.99

100,001 - 500,000 107 0.41

23,217,345 6.84

500,001 - 5,000,000 35 0.13

44,416,943 13.08

5,000,001 - 50,000,000 2 0.01

13,357,430 3.93

50,000,001 - 339,521,837 1 0.00

209,559,630 61.72

Grand-Total 26,119 100.00 339,521,837 100.00



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19. INTERNAL FINANCIAL CONTROLS

Effective financial controls are an essential management tool. Accordingly, reasonable care has been taken to establish and maintain a framework of financial controls to ensure that the Company’s assets are safeguarded and that proper accounting records are maintained with a view to providing reliable financial information.

There exist adequate guidelines for all aspects of internal controls relating to operational and compliance controls as well as risk management. The Board and Management will in line with regulation and international best practices continue to review the effectiveness and the adequacy of the Company’s internal control systems and update such as may be necessary.

20. AUDITORS Messrs. KPMG Professional Services were appointed External Auditors from the 11th of June, 2014. In

accordance with Section 357 (2) of the Companies and Allied Matters Act, (Cap C20), Laws of the Federation of Nigeria 2004, Messrs. KPMG Professional Services have indicated their willingness to continue in office as External Auditors of the Company. A resolution will be proposed at the next Annual General Meeting authorizing the directors to determine their remuneration.

BY ORDER OF THE BOARD

Olubunmi Popoola-Mordi FRC/2013/ICSAN/00000002042 Company Secretary LAGOS, NIGERIA

28th March, 2019



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Total is committed to institutionalizing the principles of corporate governance and ethical business practices. We have always adopted a responsible attitude towards corporate governance and issues of corporate social responsibility in Nigeria. The Company conducts its business with integrity and pays due regard to the laws of Nigeria and the legitimate interest of its stakeholders. The Board of Directors (“the Board”) is continually reviewing corporate governance standards and procedures in line with international best practices. The Board has demonstrated commitment towards embedding excellent corporate governance practices across the entire Company. This commitment is visibly seen in its sustained drive to institutionalize practices, policies and structures which accentuate the very essence of good corporate governance and best practices in its functions and across the entire Company. THE BOARD OF DIRECTORS As currently constituted, the Board of Directors comprises the Chairman, the Managing Director, one Executive Director as well as six Non-Executive Directors. The positions of the Chairman and that of Managing Director are held by different persons. In accordance with the provisions of the Company’s Articles of Association, the Board is mandated to manage the business and affairs of the Company except as required by statute or the Articles to be exercised by the Company in the general meeting. The Directors of Total are well established in various fields of endeavour and bring a wealth of experience to bear on the activities of the Board.

Roles and Responsibilities of the Board of Directors The Board is responsible for ensuring that the Company is properly managed and meets its strategic objectives. The Directors act in good faith, with due diligence and care and in the best interest of the Company. The Board in discharging its duties, adopts best international practice principles in line with laid down regulations. The responsibilities of the Board include:

a) Management of the business and affairs of the Company except as required by statute or the Articles to be exercised by the Company in the general meeting;

b) Articulation and formation of Strategy;

c) Formulation of policies and overseeing the management and conduct of business;

d) Formulation and management of risk management framework;

e) Succession planning and the appointment, training, remuneration and replacement of Board members and

Executive Committee members;

f) Overseeing the effective performance of management in order to protect and enhance shareholder value and to meet the Company’s obligations to its stakeholders.

g) Overseeing the effectiveness and adequacy of internal control systems;

h) Performance monitoring and appraisal of the Company;

i) Overseeing the maintenance of the Company’s communication and information dissemination policy;

j) Serving the legitimate interests of the shareholders and the Company and accounting to them fully;

k) Ensuring effective communication with stakeholders;

l) Reviewing and approving annual budgets.

m) Ensuring the integrity of financial reports;

n) Promoting and ensuring that ethical standards are maintained;

o) Ensuring that the human and financial resources of the Company are effectively deployed towards achieving

her goals;



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p) Ensuring that no one person or group of persons has unfettered power and that there is an appropriate

balance of power and authority on the Board which is usually reflected by separating the roles of the Managing Director/Chief Executive Officer (MD/CEO) and Chair and by having a balance between executive and non-executive Directors;

q) Regularly assessing its performance and effectiveness as a whole and that of the individual Directors,

including the MD/CEO;

r) Appointment of the MD/CEO;

s) Ensuring the motivation and protection of human capital intrinsic to the Company; ensuring that there is adequate training in the Company for management and employees and a succession plan;

t) Ensuring that all technology and systems used in the Company are adequate to properly run the business

and for it to remain effectively competitive;

u) Identifying key risk areas and key performance indicators of the business and monitoring these factors;

v) Ensuring annually that the Company survives, thrives and continues as a viable going concern;

w) Ensuring compliance with the Company’s articles, all laws and regulations;

x) Conducting performance and progress monitoring against the strategies and objectives of the Company, including assessing the Company’s financial position and performance (at least quarterly);

y) Approving the Company’s interim dividend and proposing dividends to be finally approved by the

shareholders at the annual general meeting; and

z) Deciding and approving the expenditure and authorising, investment and credit limits to be delegated to the Chair, Board Committees, Executive and Senior Management.

Board Appointment, Induction and Training Once a vacancy on the Board of Directors is declared, curricula vitae of suitable candidates (depending on the required experience, competencies and skills set) are obtained and reviewed; interviews are conducted and a recommendation is made to the Board of Directors. Appointment is by the Board of Directors. Subsequently, Directors appointed by the Board are presented to shareholders at the next Annual General Meeting for election. Board members undergo an induction and training from time to time. To ensure effective management of the Company, Directors regularly attend relevant seminars designed to aquaint them with new trends in governance and organizational development. The Board of Directors is able to retain external counsel for independent advice. Board Evaluation The Board did not conduct a formal evaluation of its performance in the year under review. Re- election of Directors As prescribed by the Company’s Articles of Association and the Companies and Allied Matters Act (CAP C20) Laws of the Federation of Nigeria, 2004 a maximum of one third of the Directors who are longest in office since their last appointment are required to retire by rotation and are eligible for re-election. Likewise, Directors appointed since the last Annual General Meeting retire and being eligible, offer themselves for re-election. Messrs. Mittelman and Dormoy are Directors seeking re-election at this Annual General Meeting. Their biographical details are contained on Pages 12 to 14 of this Annual Report and Accounts. Code of business conduct and ethics The Board is committed to conducting all business activities, legally, ethically and in accordance with the highest standards of integrity and propriety. The Board exercises leadership, enterprise, integrity and judgment in directing the Company so as to achieve continuing survival and prosperity for the company.



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The Board promotes an ethical corporate culture. Every Director and employee subscribes to comply with the Company’s Business Integrity Guide and Code of Conduct which covers our business principles and ethics. We are committed to maintaining a brand of repute and business reputation. Attendance at Board Meetings The Board met 5 (five) times during the 2018 financial year. Attendance at Board Meetings during the year ended 31st December, 2018 is as indicated below:

Directors 21st February 20th June 25th July 25th October 7th December

Mr. S. Mittelman P P A P P

Mr. J-P Torres P P P R R

Mr. I. Barry N N P p P

Mr. B Dormoy P P P P P

Chief F. Majekodunmi A P P P P

Ms. T. Ibru P P A P P

Engr. A.R. Sirajo P P P P P

Mr. F.Colmet-Daage P P P R R

Mr. O. Hahn P P A P A

Prince (Dr.) J.E Nnamani P P P P P

Mr. A. Adotevi N N N P P

Attendance Keys: A= Absent with apology, P= Present, N = Not yet appointed R= Resigned

Board Committees In line with its Articles, the Companies and Allied Matters Act, (Cap C20), Laws of the Federation of Nigeria 2004 and in conformity with the Securities and Exchange Commission’s 2011 Corporate Governance Code, the Board has established committees. These committees assist the Board to effectively perform its guidance and oversight functions. All committees have terms of reference which guide them in the carrying out of their responsibilities. The committees comprise of Directors and shareholder representatives. Currently, there are two Board committees and a statutory committee. The following committees are in existence: Diversity and Staff Development Committee, Corporate Governance Committee and the Statutory Audit Committee. In the opinion of the Board, the committees performed creditably during the year under review. (i) Diversity and Staff Development Committee:

The Company recognizes diversity as a decisive factor for its competitiveness, attractiveness and ability to adapt. This committee is charged with studying diversity patterns in the work-force and developing ideas and solutions towards ensuring a balanced and productive human resource base for the Company as well as recommending methods for building and developing employee potential in line with Company policy.

The members of the Diversity and Staff Development Committee were:

Chief F. Majekodunmi

Ms. T. Ibru

Engr. R. Sirajo

Mr. Jeff Nnamani

Attendance at the meetings of the committee during the year ended 31st December, 2018 was as indicated below:

Director 9th March

25th October

6th December

Chief F.Majekodunmi P P P

Ms. T. Ibru (Chair) P P P

Engr. A.R. Sirajo P P P

Dr. J. Nnamani P P P

Attendance Keys: P= Present



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(ii) Corporate Governance Committee: This committee’s brief is essentially the application of the Code of Corporate Governance to the structure and operations of the Company with a view to ensuring compliance with internationally accepted guidelines, practices and norms of corporate conduct. In this respect, it examines matters that bear potential risks for the Company. The members of the committee were:

Chief F. Majekodunmi

Ms. T. Ibru

Engr. A.R Sirajo

Attendance at meetings of the meeting of the committee during the year ended 31st December, 2018 was as indicated below:

Director 9th March 23rd October

6th December

Chief F.Majekodunmi P P P

Ms. T. Ibru (Chair) P P P

Engr. A.R. Sirajo P P P

Mr. B. Dormoy P P P


(iii) Statutory Audit Committee: In compliance with Section 359(3) of the Companies and Allied Matters Act, (CAP C20) Laws of the Federation of Nigeria,, 2004 the Company has established a Statutory Audit Committee. The Statutory Audit Committee is composed of three Directors (two of whom are Non-Executive Directors) and three shareholders elected at the Annual General Meeting. It is chaired by a shareholder representative. The terms of reference of the committee are as prescribed in the provisions of Section 359(6) of the Companies and Allied Matters Act, (CAP C20) Laws of the Federation of Nigeria, 2004. In the performance of their duties, members of the committee have direct access to the internal audit department, the external auditors, management and any other officer that is required. In compliance with the provisions of Section 359(5) of the Companies and Allied Matters Act, (CAP C20) Laws of the Federation of Nigeria, 2004 the following members and Directors were elected and will serve on the committee up to the conclusion of the 41st Annual General Meeting:

Chief T.A. Adesiyan - Shareholder (Chairman)

Mr. T.K Akanji - Shareholder

Mr. C. Achara - Shareholder

Ms. T. Ibru - Director

Engr. R. Sirajo - Director

Mr. B. Dormoy - Director

Attendance at meetings of the Committee (21st June, 2018 – 26h March, 2019) was as indicated below

16th August 23rd October 7th December 26th March

Chief T.A. Adesiyan (Chairman)

P P P P

Mr. K.A Taiwo. Adesiyan

P P P P

Mr. C. Achara P P P P

Ms. T. Ibru P P P P

Engr. R. Sirajo P P P P

Mr. B. Dormoy P P P P


In accordance with Section 359(6) of the Companies and Allied Matters Act, (CAP C20) Laws of the Federation of Nigeria, 2004 the Shareholders and Directors stated above sat on the Audit Committee for the purpose of the Company’s year 2018 audit.



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COMPLIANCE STATEMENT In accordance with the amended Post-listing Requirements of the Nigerian Stock Exchange, the Company has put in place a securities trading policy which has been circulated to all directors, employees and counterparts who may at any time possess inside or material information about the Company. The said policy also contains a reminder of the Investment and Securities Act 2007 and the Companies and Allied Matters Act , (CAP C20) Laws of the Federation of Nigeria, 2004 and can be found on our website. In the course of 2018, none of our directors, employees and counterparts notified us of any contravention of the Post-listing Requirements of the Nigerian Stock Exchange and Total’s Securities Trading Policy. The Company has complied with the requirements of the Securities and Exchange Commission’s 2011 Code of Corporate Governance for Public Companies in Nigeria and the Post-listing Requirements of the Nigerian Stock Exchange. Total complied with all regulations guiding its operations and activities throughout the year. Total ensures that its existence and operations remain within the law. The Company complies with the laws and regulations of Nigeria. WHISTLE-BLOWING POLICY In line with the requirements of the Securities and Exchange Commission’s 2011 Code of Corporate Governance and global best practices, the Company has put in place a Whistle-Blowing Policy which is a process whereby the illegal, unethical or inappropriate actions of employees that are injurious to the interest of the company can be reported. The whistle blowing hotline is confidentially managed by PriceWaterhouseCoopers. CORRUPTION Safety is one of the pillars of our organization, and so are Governance and Ethics. They define who we are, what we believe in, how we behave and interact. We shall continue to strongly promote integrity whilst sanctioning corrupt and fraudulent behaviour.Total Nigeria Plc is an ethical business organisation. In all our dealings, we are committed to the highest standards of integrity. We do not tolerate bribery and corruption in any form. We actively promote transparency, encourage and monitor strict adherence to our anti-corruption policy. Not only is our anti-corruption policy entrenched in-house (as our staff are trained), we have extended the same to our suppliers, partners and third parties acting for and on behalf of Total Nigeria Plc. Our stance remains a policy of zero tolerance for corruption. Demonstrating high ethical standards has today become a business imperative and is a vital criterion in achieving our ambition to become the responsible energy major. The Company has developed a robust compliance plan, which involves knowing who you are doing business with, continuously analyzing the risks associated with every transaction, monitoring, making our expectations clear to our suppliers and demanding them to cascade same to their stakeholders. Our staff and stakeholders are encouraged to approach issues with individual and collective vigilance. Everyone in the chain must play his / her role. In the course of the year several programmes and activities were run on ethics; these culminated in the Company setting aside the 9th of December, 2018 to commemorate the Total Business Ethics Day which focused on Supply Chain Challenges. ANTI-COMPETITON We recognize that competition is an instrument of promoting growth and sustainable development. We are at the forefront of fostering competition in our sector of the economy as we actively play by the rules and ensure that we do not engage in anti-competitive activities. ROLE IN SOCIETY Total Nigeria Plc is one of the major players in the downstream sector of the oil and gas industry and is an integral part of the Nigerian society as an employer, a supplier, a customer, a partner and a taxpayer. Through its service providers, stations dealers, suppliers and transporters, Total provides employment to over 10,000 persons. We consult with our stakeholders and have a policy which, not only drives but equally regulates our relationships within our operating environment. Total organizes stakeholders’ fora in all its sites where joint decisions are taken concerning projects implementation and monitoring jointly implemented. The Company has a strong belief that sustenance of its business is linked to the wellbeing of its immediate environment hence its decision to invest in health, education and economic empowerment of its host communities, stakeholders and the Nigerian public.



27

We have remained unwavering in our commitment to impact on the Nigerian society through the sustainable implementation of various projects. In this regard we continued to carry out the Road Safety Cubes Campaign aimed at protecting Nigerian children from road accidents by educating them on road signs and proper behaviour on the roads. This year we took the programme to 103 Schools in Abia, Abuja, Cross Rivers, Ebonyi, Gombe, Kwara, Lagos, Owerri, Plateau, Rivers and Sokoto states. Through our Skills Acquisition Programme we continued to empower and train youths of our host communities on vocations of their choice. These vocations include but are not limited to welding and fabrication, fashion and designing, hairdressing, information technology, woodcraft and furniture making. All graduates of the programme have been equipped with starter packs and tools to enable them commence their small scale businesses. Also in partnership with our sister company Total E&P our AIDS awareness campaign focused on Plateau state for 2018 with Free Voluntary Counselling and Testing in various locations in the state. World Malaria Day also saw us jointly taking our preventive awareness campaign to Ibadan, Oyo State where treated mosquito nets were distributed and Rapid Diagnostics Testing donated. To educate people about cardiovascular diseases and their prevention, we organized an outreach at Ajah Market in Lagos where educational materials and testing was done. Through our Complete Child Care Initiative, we are sponsoring 40 orphaned children living in four family houses at the SOS Children's Villages in Lagos, Abuja, Ogun and Jos. The Mentor - a - Child – Programme remains a key component of our sponsorship. It is a programme which runs side by side with the corporate sponsorship whereby employees act as mentors through the monitoring of the moral, mental and general developmental stages in the lives of their chosen child while the child still lives in the village The Total Job Shadow initiative helped us to expose 40 Senior Secondary School students, from Secondary Schools in Kano state, to the potential jobs they can aspire to do by allowing them spend time at our Kano office and at the Kano airport. The students were paired up with employees who acted as mentors to them for the day. They were exposed to actual work environment side by side employees, and given a tour of our facilities. They were also engaged in a leadership workshop. The students wrote an essay on their experience and learning points at the end of the program. A prize of an educational computer was given to each of the first three winners whilst consolation prizes were given to the runners up. We have continued to support several non-governmental organisations which focus on education, addressing substance abuse, providing Brailed text books, programs and services to the visually impaired and blind, caring for the young and elderly etc. RELATIONSHIP WITH SHAREHOLDERS The Board considers effective communication with Shareholders as being of utmost importance. The Board is committed to continuous engagement with its shareholders and ensures that shareholder rights are well protected. The Company reports formally throughout the year with the quarterly and full year results announcements, Corporate Social Responsibility and Annual Reports to all Shareholders. Through these reports the Board renders an account of its stewardship to shareholders. In accordance with the rules of the Securities and Exchange Commission, shareholders who have complaints may use the electronic complaints register on the Company’s website to register their complaints. This enables the Company to handle complaints from shareholders in a timely, effective, fair and consistent manner. Total maintains active dialogue with its shareholders. From time to time the Company also makes other announcements which can be found on our website (www.total.com.ng). We can also be contacted on social media via:

Twitter (www.twitter.com/totalnigeriaplc) Facebook (www.facebook.com/totalnigeria).

Youtube (www.youtube.com/Total) In addition to this, periodically, Total holds meetings with institutional investors and other Shareholders.


http://www.twitter.com/totalnigeriaplc

http://www.facebook.com/totalnigeria

http://www.youtube.com/Total



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The Board also welcomes the participation of all Shareholders at the Annual General Meeting during which Shareholders are able to put questions to the Directors, Audit Committee and Senior Managers in writing prior to the meeting, formally during the meeting and informally after the meeting. Our records show that several dividends and share certificates remain unclaimed despite publications in the newspapers to our shareholders and the circulation of the e-dividend forms. Affected shareholders are urged to kindly

update their records to enable the Registrars complete the e-dividend process. The e-dividend form is attached to this annual report for your necessary and urgent attention.

Olubunmi Popoola-Mordi FRC/2013/ICSAN/00000002042 Company Secretary



29

STATEMENT OF DIRECTORS RESPONSIBILITIES In accordance with the provisions of Sections 334 and 335 of the Companies and Allied Matters Act (CAP C20) Laws of the Federation of Nigeria, 2004, the Company’s Directors are responsible for the preparation of the financial statements which give a true and fair view of the state of affairs of the Company as at the end of the financial year and its results for that year. This responsibility includes ensuring that: - Proper accounting records are maintained; - Appropriate internal control procedures are instituted which, as far as is reasonably possible, safeguard

the assets, prevent and detect fraud and other irregularities; - Applicable accounting standards are followed; - Suitable accounting policies and standards are adopted and consistently applied; - Judgments and estimates made are reasonable and prudent; and - The going concern basis is used, unless it is inappropriate to presume that the Company will continue

in business. The Directors accept responsibility for these financial statements which have been prepared using the appropriate accounting policies supported by reasonable and prudent judgments and estimates, in conformity with the International Financial Reporting Standards, the Financial Reporting Council of Nigeria Act No. 6 2011 and the Companies and Allied Matters Act (CAP C20) Laws of the Federation of Nigeria, 2004. The Directors are of the opinion that these financial statements give a true and fair view of the state of affairs of the Company as at the end of the financial year and its results for that year. The Directors further accept responsibility for maintaining adequate accounting records as required by the Companies and Allied Matters Act CAP C20) Laws of the Federation of Nigeria, 2004 and for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatements whether due to fraud or error. Nothing has come to the attention of the Directors that indicate that the Company will not remain a going concern for twelve months from the date of this statement.

Mr. B. Dormoy Mr. I. BARRY FRC/2017/IODN/00000017283 Managing Director Executive Director 28th March, 2019 28th March, 2019



30

TOTAL NIGERIA PLC

STATEMENT OF FINANCIAL POSITION

AS AT 31 December 31 December

2018 2017

Notes ₦'000 ₦'000Non-current assets

Property, plant and equipment 16 33,855,656 28,519,814

Intangible assets 15 25,943 50,572

Prepayments 19 7,201,941 4,291,217

Trade and other receivables 18.1 1,524,840 2,875,395

Total non-current assets 42,608,380 35,736,998

Current Assets

Inventories 17 30,045,177 26,666,240

Trade and other receivables 18 52,007,770 32,726,367

Prepayments 19 1,765,438 571,724

Cash and cash equivalents 23 6,094,018 12,162,802

89,912,403 72,127,133

Assets held-for-sale 16.2 - 117,742

Total current assets 89,912,403 72,244,875

Total assets 132,520,783 107,981,873

Equity

22 169,761 169,761

30,561,127 28,055,790

Total equity 30,730,888 28,225,551

Non-current liabilities

Deferred tax liabilities 11.3 5,370,433 2,393,262

Deferred income 21.3 - 6,000

Employee benefits 12 435,408 418,152

Total non-current liabilities 5,805,841 2,817,414

Current liabilities

Trade and other payables 21 61,583,881 63,419,933

Deferred income 21.2 38,535 78,781

Current tax liabilities 11.2 141,094 305,171

Borrowings 20 34,220,544 13,135,023

Total current liabilities 95,984,054 76,938,908

101,789,895 79,756,322

Total equity and liabilities 132,520,783 107,981,873

0 (0)

Imrane Barry - Managing Director1

Bruno Dormoy - Executive Director

Additionally certified by:

Samson Eghwerehe - Head of Finance

1A waiver has been obtained from the Financial Reporting Council (FRC) of Nigeria dated 13 February 2019; for Mr. Imrane Barry to approve these 2018

financial statements pending finalization of his registration with the Council.

FRC/2017/ICAN/00000018952

The notes on pages 42 to 82 form an integral part of these financial statements.

Share capital

Retained earnings

Total liabilities

FRC/2017/IODN/00000017283

These financial statements were approved by the Board of Directors of the Company on 28 March 2019 and signed on behalf of the Board

by:

38

TOTAL NIGERIA PLC

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED

31 December 31 December

2018 2017

Notes ₦'000 ₦'000

Revenue 6 307,987,896 288,062,650

10 (273,202,676) (258,766,772)

Gross profit 34,785,220 29,295,878

9.1 1,451,424 3,936,147

9.2 (1,324,883) -

10 (4,470,363) (2,719,209)

10 (19,945,070) (17,668,753)

(684,512) (574,849)

Operating profit 9,811,816 12,269,214

8 6,747,584 2,589,877

8 (4,460,937) (3,063,808)

Net finance income/ (costs) 2,286,647 (473,931)

Profit before taxation 12,098,463 11,795,283

Taxation 11.1.1 (4,137,570) (3,775,985)

Profit for the year 7,960,893 8,019,298

Other comprehensive income - -

Total comprehensive income for the year 7,960,893 8,019,298

Earnings per share

Basic and diluted earnings per share 14 23.45 23.62


Finance costs

Other expenses

Selling & distribution costs

Administrative expenses

Other income

Cost of sales

Finance income

Impairment loss on trade receivables

and contract assets

39

TOTAL NIGERIA PLC

STATEMENT OF CHANGES IN EQUITY

Share

capital

Retained

earnings

Total

equity

₦'000 ₦'000 ₦'000

Notes

Balance at 1 January 2018 169,761 28,055,790 28,225,551

4.22 - 255,846 255,846

Adjusted balance at 1 January 2018 169,761 28,311,636 28,481,397

- 7,960,893 7,960,893

13.1 - 60,470 60,470

13.1 - (4,753,306) (4,753,306)

13.1 - (1,018,566) (1,018,566)

Total transactions with owners of the Company - (5,711,402) (5,711,402)

169,761 30,561,127 30,730,888

Share

capital

Retained

earnings

Total

equity

₦'000 ₦'000 ₦'000

Notes

Balance as at 1 January 2017 169,761 23,400,336 23,570,097

- 8,019,298 8,019,298

13.1 - 31,374 31,374

13.1 - (2,376,652) (2,376,652)

13.1 - (1,018,566) (1,018,566)

Total transactions with owners of the Company - (3,363,844) (3,363,844)

169,761 28,055,790 28,225,551

For the year ended 31 December 2018

Total comprehensive income for the year

Transactions with owners of the Company:

Prior year final dividend

Balance at 31 December 2018

Contributions and Distributions

Forfeited dividend

Current year interim dividend

Adjustment on initial application of IFRS 9, net of tax

Current year interim dividend

Balance at 31 December 2017


For the year ended 31 December 2017

Total comprehensive income for the year

Transactions with owners of the Company:

Contributions and Distributions

Forfeited dividend

Prior year final dividend

40

TOTAL NIGERIA PLC

STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 December 31 December

2018 2017

Note ₦'000 ₦'000

Profit for the year 7,960,893 8,019,298

Adjustments for:

Depreciation 16 4,306,166 3,460,906

Amortisation 15 31,490 49,934

Provision for Long Service Award 31(iii) 88,101 219,857

Write down and write back of inventory (Net) 17.1 (1,366) 35,156

Gains on sale of PPE 9 (1,201,521) (103,142)

Reversal and remeasurement of foreign exchange forward contract 9.2 - (1,624,000)Net foreign exchange (gain)/loss 9.2 1,324,883 (993,424)

Net finance costs 8 (2,286,647) 473,931

Taxation 11.1.1 4,137,570 3,775,985

14,359,569 13,314,501

Changes in:

- Inventories (3,377,571) 8,201,448

- Trade and other receivables (17,071,388) 16,152,096

- Prepayments (3,961,369) 155,777

- Trade and other payables 1,674,266 (21,440,794)

- Derivative financial liabilities - (1,624,000)

- Deferred tax 120,396 -

- Deferred income (46,246) (138,760)

Cash (used in)/ generated from operating activities (8,302,343) 14,620,268

Payment for long service award 12 (70,845) (25,497)

Interest on loans and receivables 8 6,360,602 2,299,362

Tax paid 11.2 (981,723) (6,743,576)

Withholding tax 11.2 (463,149) (565,703)

Net cash (used in)/ generated from operating activities (3,457,458) 9,584,854

Cash flows from investing activities

Additions to finance lease (236,513) (1,931,068)

Purchase of property, plant and equipment 16 (9,809,517) (7,179,048)

Purchase of intangible assets 15 (6,861) (26,536)

Interest on deposits 8 386,982 290,515

Proceeds from disposal of property, plant and equipment 1,343,704 182,666

Net cash used in investing activities (8,322,204) (8,663,471)

Cash flows from financing activities

Interest paid 8 (4,460,937) (3,063,808)

Trade finance loan 20 8,512,109 (2,833,564)

Dividends paid 13.1 (2,997,605) (6,566,587)

Net cash generated from/ (used in) financing activities 1,053,567 (12,463,959)

Net decrease in cash and cash equivalents (10,726,095) (11,542,575)

Cash and cash equivalents at 1 January 2,587,742 19,016,262

Effect of movement in exchange rates on cash held (7,916,100) (4,885,945)

23 (16,054,454) 2,587,742 Cash and cash equivalents as at year ended


41

TOTAL NIGERIA PLC

NOTES TO THE FINANCIAL STATEMENTS

1 The Company

Legal form:

Number Holdings Number Holdings

'000 % '000 %

Total Raffinage Marketing 209,560 61.72 209,560 61.72

Other shareholders 129,962 38.28 129,962 38.28

339,522 100.00 339,522 100.00

Principal activities

Description of business

2.0 Basis of preparation

2.1 Statement of compliance

2.2 Basis of measurement

2.3 Functional and presentation currency

These financial statements have been prepared in accordance with the International Financial Reporting Standards

(IFRS) as issued by the International Accounting Standards Board (IASB) and in conformity with the Financial Reporting

Council (FRC) of Nigeria Act, 2011 and the Companies and Allied Matters Act, Cap C.20, Laws of the Federation of

Nigeria, 2004 (“CAMA”). They were approved by the Board of Directors on 28 March 2019.

Total Nigeria Plc. ("the Company") is a subsidiary of Total Raffinage Marketing ("the Parent Company") in France and

operates in the petroleum marketing and distribution business in Nigeria. The Company's registered office is situated at:

The Company was incorporated as a private limited liability company in 1956 and was converted to a public company in

1978. The merger of the Company with Elf Oil Nigeria Limited which commenced globally in November 1999 was

completed in Nigeria in 2002. With this development, the authorised, issued and fully paid share capital was

₦148,541,000 made up of 297,082,000 ordinary shares of 50k each. In 2003, to mark the completion of its corporate

mergers, Total Group worldwide reverted to its former name Total and adopted a new logo with a unifying design to

express its corporate ambition.

Accordingly, the Company changed its name from TotalFinaElf Nigeria Plc to Total Nigeria Plc in the same year. With

the capitalisation of the bonus issue of 42,440,228 ordinary shares of 50k each in March 2004, the authorised share

capital became ₦169,760,918 made up of 339,521,837 ordinary shares of 50k each. 61.72% of the Company's ordinary

shares were held by Total Societe Anonyme up until 2013 when a restructuring was concluded and Total Raffinage

Marketing became the shareholders of 61.72% of Total Nigeria Plc while the remaining 38.28% are held by some

members of the general public.

31 December 2018 31 December 2017

The principal activity of the Company is the blending of lubricants, sales and marketing of refined petroleum products

and solar products .

No shareholder, except as disclosed above, held more than 10% of the issued share capital of the Company as at 31

December 2018 (2017: Nil).

No. 4, Churchgate Street

Victoria Island

Lagos State

These financial statements have been prepared on the historical cost basis except for the following;

- provision for long service award which has been measured at the present value of the obligation (Note 12)

- inventories which has been measured at lower of cost and net realisable value (NRV)

- trade and other payables which has been measured at amortised cost

- trade and other receivables which has been measured at amortised cost.

These financial statements are presented in Nigerian Naira (NGN), which is the Company's functional currency. All

financial information presented in Nigerian Naira have been rounded to the nearest thousand unless otherwise stated.

42

TOTAL NIGERIA PLC


2.4

2.5

2.6

2.7

(a) Judgement

(i)

(ii) Recognition of foreign exchange balances

(b) Assumptions and estimation uncertainties

(i) Employee benefits

(ii)

(iii)

Measurement of Expected Credit Loss (ECL) - Note 26 (iv)

Significant events and transactions.

Other than events already disclosed in the various notes, there are no other significant events in the year that are

required to be disclosed.

Going concern

Use of estimates and judgments

Information about judgements made in applying accounting policies that have the most significant effects on

amounts recognised in the financial statements are as follows;

Determining if balances held with Total Treasury meets the criteria for classification as cash and cash equivalents.

In preparing these financial statements, the directors have made certain judgements, estimates and assumptions that

affect the application of the Company's accounting policies and the reported amounts of assets, liabilities, income and

expenses. Actual results may differ from these estimates.

These financial statements cover the financial period from 01 January 2018 to 31 December 2018, with corresponding

figures for the financial period from 01 January, 2017 to 31 December, 2017.

Recognition of contingencies - key assumptions about likelihood and magnitude of an outflow of resources.

Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are

recognised prospectively.

These financial statements have been prepared on a going concern basis.

The amount recognised in Note 12 of the financial statements as employee benefits - measurement of the

Company's Long Service Award (LSA) scheme. This estimate relates to the discount rate, mortality and inflation

rate applied in the computation of the Company's liabilities.

Financial period

Measurement of contingencies - Note 24

Allowance for trade and other receivables - key assumptions in determining the weighted average loss rate.

Cash held with Total Treasury - Note 23

Information about assumptions and estimation uncertainties at 31 December 2018 that have a significant risk of

resulting in a material adjustment to the carrying amounts of assets and liabilities in the next financial year includes;

Balances in foreign currencies included in Note 26(ii) of these financial statements have been translated using the

applicable rates from the most advantageous market for the different categories of monetary assets and liabilities of

the company.

43

TOTAL NIGERIA PLC


3

Date issued by

IASB

Effective date Periods beginning on or

after Summary of the requirements and assessment of impact

- IFRIC 23 Uncertainty over Income Tax Treatments

New standards and interpretations not yet adopted

Effective for the financial year commencing 1 January 2019

- IFRS 16 Leases

A number of new Standards, Amendments to Standards, and Interpretations are effective for annual periods beginning after 1 January 2019 and early application is permitted;

however, the Company has not applied the new or amended standards in preparing these financial statements. Those Standards, Amendments to Standards, and Interpretations

which may be relevant to the Company are set out below.

1 January 2019

Early adoption is permitted

Standard/Interpretation not

yet effective as at 31

December 2017

IFRS 16 was published in January 2016. It sets out the principles for the

recognition, measurement, presentation and disclosure of leases for both parties

to a contract, i.e. the customer (‘lessee’) and the supplier (‘lessor’). IFRS 16

replaces the previous leases Standard, IAS 17 Leases, and related

Interpretations. IFRS 16 includes a single model for lessees which will result in

almost all leases being included in the Statement of Financial Position. No

significant changes have been included for lessors. IFRS 16 also includes

extensive new disclosure requirements for both lessees and lessors.

The Company has begun assessing the potential impact of IFRS 16 on the

financial statements. Refer to note 3.1 of these financial statements for detailed

disclosure on the impact of IFRS 16.

The standard is effective for annual periods beginning on or after 1 January

2019, with early adoption permitted only if the entity also adopts IFRS 15.

IFRS 16 1 January 2019

Early adoption is permitted only for

entities that adopt IFRS 15 Revenue from

Contracts with Customers, at or before

the date of initial application of IFRS 16

January 2016Leases

The directors are of the opinion that the impact of the application of the relevant standards and interpretations will be as follows:

IFRIC 23 clarifies the accounting for income tax treatments that have yet to be

accepted by tax authorities. Specifically, IFRIC 23 provides clarity on how to

incorporate this uncertainty into the measurement of tax as reported in the

financial statements. IFRIC 23 does not introduce any new disclosures but

reinforces the need to comply with existing disclosure requirements about:

• Judgments made;• Assumptions and other estimates used; and• The potential impact of uncertainties that are not reflected.

IFRIC 23 applies for annual periods beginning on or after 1 January 2019.

Amendments

to IAS 1 and

IAS 8

Definition of

Material

October 2018 1 January 2020

Early adoption is permitted

The IASB refined its definition of material to make it easier to understand. It is

now aligned across IFRS Standards and the Conceptual Framework. The

changes in Definition of Material (Amendments to IAS 1 and IAS 8) all relate to a

revised definition of ‘material’ which is quoted below from the final amendments

"Information is material if omitting, misstating or obscuring it could reasonably be

expected to influence decisions that the primary users of general purpose

financial statements make on the basis of those financial statements, which

provide financial information about a specific reporting entity.”The Board has also removed the definition of material omissions or

misstatements from IAS 8 Accounting Policies, Changes in Accounting Estimates

and Errors.

The amendments are effective from 1 January 2020 but may be applied earlier.

However, the Board does not expect significant change – the refinements are not

intended to alter the concept of materiality.

IFRIC 23 Uncertainty Over

Income Tax

Treatments

June 2017

44

TOTAL NIGERIA PLC


3.1

(i)

(ii)

Impact assessment - IFRS 16

The Company is required to adopt IFRS 16 Leases from 1 January 2019. The Company has assessed the estimated impact that

initial application of IFRS 16 will have on its financial statements, as described below. The actual impacts of adopting the

standard on 1 January 2019 may change because:

– the Company has not finalised the testing and assessment of controls over its new IT systems; and– the new accounting policies are subject to change until the Company presents its first financial statements that include the date

of initial application. IFRS 16 introduces a single, on-balance sheet lease accounting model for lessees. A lessee recognises a

right-of-use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease

payments. There are recognition exemptions for short-term leases and leases of low-value items. Lessor accounting remains

similar to the current standard – i.e. lessors continue to classify leases as finance or operating leases. IFRS 16 replaces existing

leases guidance, including IAS 17 Leases , IFRIC 4 Determining whether an Arrangement contains a Lease , SIC-15 Operating

Leases – Incentives and SIC-27 Evaluating the Substance of Transactions Involving the Legal Form of a Lease.

Leases in which the Company is a lessee.

The Company will recognise new assets and liabilities for its operating leases of facilities and vehicles. The nature of expenses

related to those leases will now change because the Company will recognise a depreciation charge for right-of-use assets and

interest expense on lease liabilities.

Previously, the Company recognised operating lease expense on a straight-line basis over the term of the lease, and recognised

assets and liabilities only to the extent that there was a timing difference between actual lease payments and the expense

recognised.

In addition, the Company will no longer recognise provisions for operating leases that it assesses to be onerous. Instead, the

Company will include the payments due under the lease in its lease liability. No significant impact is expected for the Company’sfinance leases. The company is yet to conclude on it assessment of the impact of IFRS 16 but would implement on 1 January

2019

Transition

The Company plans to apply IFRS 16 initially on 1 January 2019, using the modified retrospective approach. Therefore, the

cumulative effect of adopting IFRS 16 will be recognised as an adjustment to the opening balance of retained earnings at 1

January 2019, with no restatement of comparative information. The Company plans to apply the practical expedient to

grandfather the definition of a lease on transition. This means that it will apply IFRS 16 to all contracts entered into before 1

January 2019 and identified as leases in accordance with IAS 17 and IFRIC 4.

45

TOTAL NIGERIA PLC


4 Significant accounting policies

4.1 Foreign currency transactions

4.2 Revenue and other income

(i) Revenue recognition

Performance obligations and revenue recognition policies

(ii) Other income

Customers obtain control of products

when the goods are delivered to and

have been accepted at their

premises. Invoices are generated and

revenue is recognised at that point in

time. Credit sales are due for

collection within 30 days.

Revenue is recognised when the

goods are delivered and have

been accepted by customers at

their premises or picked up by

the customer.

Revenue was recognised when the goods

were delivered to the customers’ premises or picked up by the customer, which was

taken to be the point in time at which the

customer accepted the goods and the

related risks and rewards of ownership

transferred.

The Company recognises income from commission on sales at its bonjour shops as well as the rental of some of

its space. The period of occupancy is the basis upon which rental income is recognised. Rental income is

recognised in profit or loss on a straight line basis over the term of the lease.

The Company has initially applied IFRS 15 from 1 January 2018. Information about the Company’s accounting

policies relating to contracts with customers is provided and the effect of initially applying IFRS 15 is described in

Note 4.22. Due to the transition method chosen in applying IFRS 15, comparative information has not been restated

to reflect the new requirements.

Revenue streams

The Company generates revenue primarily from the sale of refined petroleum products and lubricants to its

customers (see Note 5). Other sources of revenue include sale of special fluids and solar products.

Revenue is measured based on the consideration specified in a contract with a customer. The Company

recognises revenue when it transfers control over a good or service to a customer. The following table provides

information about the timing of the satisfaction of performance obligations in contracts with customers, including

significant payment terms, and the related revenue recognition policies.

Revenue recognition under

IFRS 15 (applicable from 1

January 2018)

Nature and timing of satisfaction

of performance obligations,

including significant payment

terms.

Revenue recognition under IAS 18

(applicable before 1 January 2018)

The accounting policies set out below have been applied consistently to all periods presented in these financial

statements.

Transactions denominated in foreign currencies are translated at the exchange rate on the transaction date. At

each reporting date, monetary assets and liabilities are translated at the closing rate. Non-monetary assets and

liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the

exchange rate when the fair value was determined. Non-monetary items that are measured based on historical cost

in a foreign currency translated at the exchange rate at the date of the transaction. Exchange differences are

recognised in profit or loss on a net basis as “Other income” (net foreign exchange gain) or “Other expenses” (net

foreign exchange loss).

46

TOTAL NIGERIA PLC


4.3 Finance income and finance costs

4.4 Income taxes

Current taxes

Deferred tax

The Company is subject to the Companies Income Tax Act (CITA), Tertiary Education Trust Fund

(Establishment Act 2011) and Capital Gains Tax Act. Tertiary education tax is assessed at 2% of

assessable profit, Capital gains tax at 10% of chargeable capital gains while Company income tax is

assessed at 30% of adjusted profit.

Income taxes disclosed in the statement of profit or loss and other comprehensive income include

current tax expenses/credits and deferred tax expenses/credits.

The company has determined that interest and penalties related to income taxes, including uncertain

tax treatments, do not meet the definition of income taxes, and therefore accounted for them under

IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

The Company's finance income comprises interest income on bank balances and advances to

employees and reimbursement of any foreign exchange loss and/or interest from Petroleum Product

Pricing Regulatory Agency (PPPRA). Interest income is recognised as it accrues in profit or loss, using

the effective interest method.

The Company offsets the tax assets arising from withholding tax credits and current tax liabilities if, and

only if, the entity has a legally enforceable right to set-off the recognised amounts, and it intends to

either settle on a net basis, or to realise the asset and settle the liability simultaneously. The tax asset

is reviewed at each reporting date and written down to the extent that it is no longer probable that future

economic benefits would not be realised.

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets

and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax is not recognised for:

––Temporary differences on the initial recognition of assets or liabilities in a transaction that is not a

business combination and that affects neither accounting nor taxable profit or loss;

–– Temporary differences related to investments in subsidiaries, associates and joint arrangements to

the extent that the Company is able to control the timing of the reversal of the temporary differences

and it is probable that they will not reverse in the foreseeable future; and

–– Taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible

temporary differences to the extent that it is probable that future taxable profits will be available

against which they can be used. Future taxable profits are determined based on the reversal of

relevant taxable temporary differences. If the amount of taxable temporary differences is insufficient to

recognise a deferred tax asset in full, then future taxable profits, adjusted for reversals of existing

temporary differences, are considered, based on the business plans approved by the board for the

Company.

Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no

longer probable that the related tax benefit will be realised; such reductions are reversed when the

probability of future taxable profits improves. Unrecognised deferred tax assets are reassessed at

each reporting date and recognised to the extent that it has become probable that future taxable

profits will be available against which they can be used.

Deferred tax is measured at the tax rates that are expected to be applied to temporary differences

when they reverse, using tax rates enacted or substantively enacted at the reporting date. The

measurement of deferred tax reflects the tax consequences that would follow from the manner in

which the Company expects, at the reporting date, to recover or settle the carrying amount of its

assets and liabilities.

Deferred tax assets and liabilities are offset only if certain criteria are met.

Current tax is the expected tax payable or receivable on the taxable income or loss for the period,

using tax rates statutorily or substantively enacted at the reporting date, and any adjustment to tax

payable or receivable in respect of previous periods.

PPPRA foreign exchange differentials arise when there is a difference between the CBN rate used for

imports and the rate per the PPPRA pricing template. Reimbursement of interest by PPPRA arise

when there is a delay in the payment of subsidy earned on import by PPPRA. Reimbursements of

foreign exchange loss and/or interest from PPPRA are classified under operating activities in the

Statement of Cash Flows while interest income on funds invested are classified under investing

activities.

Finance costs comprise interest expense on borrowings and unwinding of discount on provisions.

Interest expenses are recognised in profit or loss using the effective interest method.

47

TOTAL NIGERIA PLC


4.5 Earnings per share (EPS)

i Basic earnings per share

ii Diluted earnings per share

4.6 Property plant and equipment

i Recognition, derecognition and measurement

ii Subsequent costs

iii Depreciation

Type of asset Useful lives

‧ Motor vehicles 4 years

‧ Office equipment and furniture 4 years

‧ Computer equipment and other tangibles 4 - 20 years

‧ Plant, machinery and fittings 3 - 30 years

‧ Buildings 10 - 25 years‧ Leasehold land Not depreciated

The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the

future economic benefits embodied within the part will flow to the Company and its cost can be measured reliably. The carrying amount of the

replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.

Property, plant and equipment are measured at cost, less accumulated depreciation and any accumulated impairment losses.

The cost of an item of property, plant and equipment shall be recognised as an asset if;

- it is possible that future economic benefits associates with the item will flow to the entity: and

- the cost of the item can be measured reliably.

Capital work in progress is not depreciated. The attributable cost of each asset is transferred to the relevant asset category immediately the asset is

available for use and depreciated accordingly.

Diluted earnings per share adjusts the figures used in the determination of Basic earnings per share to take into account the weighted average

number of additional shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying

amount of property, plant and equipment, and are recognised in profit or loss.

Basic earnings per share is calculated by dividing the profit attributable to ordinary shareholders of the Company by the weighted average number of

ordinary shares outstanding during the year, adjusted for bonus elements in ordinary shares issued during the year.

Property, plant and equipment under construction are disclosed as work in progress. The cost of self-constructed assets includes the cost of

materials, direct labour and any other costs directly attributable to bringing the asset to a working condition for their intended use including, where

applicable, the cost of dismantling and removing the items and restoring the site on which they are located and borrowing costs on qualifying assets.

Depreciation is calculated to write off the cost of items of property, plant and equipment less their estimated residual values using the straight-line

method over their estimated useful lives, and is generally recognised in profit or loss.

Depreciation methods, useful lives and residual values are reviewed at each financial year end and adjusted if appropriate.

Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Company will obtain

ownership by the end of the lease term.

Property, plant and equipment are derecognised on disposal or when it is withdrawn from use and no future economic benefits are expected from its

disposal.

Property, plant and equipment are depreciated to their residual values using the straight-line method over their useful lives for current and

comparative periods as follows:

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of

property, plant and equipment.

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TOTAL NIGERIA PLC


4.7 Intangible assets

i Recognition and measurement

ii Subsequent expenditure

iii Amortisation of intangible assets

4.8 Assets held for sale

4.9 Dividends

Non-current assets that cease to be classified as held for sale are measured the lower of the carrying amount before the asset was classifed as held

for sale, adjusted for any depreciation that would have been recognised had the assets not been classified as held for sale and its recoverable

amount at the date of the subsequent decision not to sell.

Amortisation methods, useful lives and residual values are reviewed at each financial year end and adjusted if appropriate.

Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific intangible asset to which it

relates. All other expenditure is recognised in profit or loss as incurred.

Amortisation is calculated on the cost of the asset, or other amount substituted for cost, less its estimated residual value. Amortisation is recognised

in profit or loss on a straight-line basis over the estimated useful lives of intangible assets from the date that they are available for use, since this

most closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset.

Intangible assets that are acquired by the Company and have finite useful lives are measured at cost less accumulated amortisation and

accumulated impairment losses.

Non-current assets, or disposal groups comprising assets and liabilities, are classified as held-for-sale if it is highly probable that they will be

recovered primarily through sale rather than through continuing use.

Such assets, or disposal groups, are generally measured at the lower of their carrying amount and fair value less costs to sell.

Any impairment loss on a disposal group is allocated first to goodwill, and then to the remaining assets and liabilities on a pro rata basis, except that

no loss is allocated to inventories, financial assets, deferred tax assets, employee benefit assets, investment property or biological assets, which

continue to be measured in accordance with the company’s other accounting policies. Impairment losses on initial classification as held-for-sale or

held for distribution and subsequent gains and losses on remeasurement are recognised in profit or loss. Once classified as held-for-sale and

property, plant and equipment are no longer amortised or depreciated, and any equity-accounted investee is no longer equity accounted.

Computer software and software licences have estimated useful lives for the current and corresponding periods of 3 to 5 years.

The corresponding entry of any accrual made is in reserves and not in profit or loss.

An accrual is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the Company, on or

before the end of the reporting period but not distributed at the end of the reporting period.

Intangible assets are computer software and software licenses. These are capitalised on the basis of acquisition costs as well as costs incurred to

bring the assets to use.

Intangible assets are derecognised upon sale. The gain or loss arising from the derecognition of an intangible asset shall be determined as the

difference between the net disposal proceeds, if any, and the carrying amount of the asset.

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TOTAL NIGERIA PLC


4.10 Impairment

i Non-derivative financial assets

Policy applicable from 1 January 2018

Financial instruments

The Company recognises loss allowances for Expected Credit Losses (ECLs) on financial assets measured

The Company measures loss allowances at an amount equal to lifetime ECLs, except for bank balances for

which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not

increased significantly since initial recognition, which are measured at 12-month ECLs.

Presentation of allowance for ECL in the statement of financial position

The maximum period considered when estimating ECLs is the maximum contractual period over which the

Company is exposed to credit risk.

Measurement of ECLs

ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value

of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the

contract and the cash flows that the Company expects to receive).

Credit-impaired financial assets

– the financial asset is more than 180 days past due.

Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial

instrument. 12-month ECLs are the portion of ECLs that result from default events that are possible within

the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than

12 months).

At each reporting date, the Company assesses whether financial assets carried at amortised cost are credit-

impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on

the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is

credit-impaired includes the following observable data:

– significant financial difficulty of the borrower or issuer;– a breach of contract such as a default or being more than 180 days past due; or– it is probable that the borrower will enter bankruptcy or other financial reorganisation.

Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying

amount of the assets.

When determining whether the credit risk of a financial asset has increased significantly since initial

recognition and when estimating ECLs, the Company considers reasonable and supportable information

that is relevant and available without undue cost or effort. This includes both quantitative and qualitative

information and analysis, based on the Company’s historical experience and informed credit assessment

and including forward-looking information.The Company assumes that the credit risk on a financial asset has increased significantly if it is more than

90 days past due.

The company considers a financial asset to be in default when:

– the borrower is unlikely to pay its credit obligations to the Company in full, without recourse by the

Company to actions such as realising security (if any is held); or

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TOTAL NIGERIA PLC


4.10 Impairment (Cont'd)

Policy applicable before 1 January 2018

Objective evidence that financial assets are impaired includes;

‧ Default or delinquency by a debtor

‧

‧ Indications that a debtor or issuer will enter bankruptcy

‧ Adverse changes in the payment status of the debtors

‧

Financial assets measured at amortised cost

ii Non financial assets

Impairment losses are recognised in profit or loss. An impairment loss is reversed only to the extent that

the asset's carrying amount does not exceed the carrying amount that would have been determined, net of

depreciation or amortisation, if no impairment loss had been recognised.

At each reporting date, the Company reviews the carrying amounts of its non-financial assets (other than

inventories and deferred tax assets) to determine whether there is any indication of impairment. If any such

indication exists, then the asset’s recoverable amount is estimated.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair

value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their

present value using a pre-tax discount rate that reflects current market assessments of the time value of

money and the risks specific to the asset or CGU.

For impairment testing, assets are grouped together into the smallest group of assets that generates cash

flows from continuing use that are largely independent of the cash flows of other assets or Cash Generating

Units (CGUs).

An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its estimated

recoverable amount.

Restructuring of an amount due to the Company on terms that the Company would not consider

otherwise

The Company considers evidence of impairment for these assets at both an individual asset and a

collective level. All individually significant assets are individually assessed for impairment. Those found not

to be impaired are then collectively assessed for any impairment that has been incurred but not yet

individually identified. Assets that are not individually significant are collectively assessed for impairment.

Collective assessment is carried out by grouping together assets with similar risk characteristics.

An impairment loss is calculated as the difference between an asset's carrying amount and the present

value of the estimated future cash flows discounted at the asset’s original effective interest rate. Losses are

recognised in profit or loss and reflected in an allowance account. When the Company considers that there

are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the amount of

impairment loss subsequently decreases and the decrease can be related objectively to an event occurring

after the impairment was recognised, then the previously recognised impairment loss is reversed through

profit or loss.

Financial assets not classified at fair value through profit or loss (FVTPL) are assessed at each reporting

date to determine whether there is objective evidence of impairment.

Observable data indicating that there is a measurable decrease in the expected cash flows from a group

of financial assets

Write-off

The gross carrying amount of a financial asset is written off when the Company has no reasonable

expectations of recovering a financial asset in its entirety or a portion thereof. For customers, the Company

makes an assessment with respect to the timing and amount of write-off based on whether there is a

reasonable expectation of recovery. The Company expects no significant recovery from the amount written

off. However, financial assets that are written off could still be subject to enforcement activities in order to

comply with the Company’s procedures for recovery of amounts due.

In assessing collective impairment, the Company uses historical information on timing of recoveries and

the amount of loss incurred, and makes adjustment if current economic and credit conditions are such that

the actual losses are likely to be greater or less than suggested by historical trends.

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TOTAL NIGERIA PLC


4.11 Financial instruments

i Recognition and initial measurement

ii Classification and subsequent measurement

Financial assets - Policy applicable from 1 January 2018

Financial assets - Business model assessment: Policy applicable from 1 January 2018

On initial recognition, a financial asset is classified as measured at: amortised cost; FVOCI – debt

investment; FVOCI – equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its

business model for managing financial assets, in which case all affected financial assets are reclassified on

the first day of the first reporting period following the change in the business model.

A financial asset is measured at amortised cost if it meets both of the following conditions and is not

designated as at FVTPL:

- it is held within a business model whose objective is to hold assets to collect contractual cashflows; and

- its contractual terms give rise on specified dates to cash flows that are solely payments of principal and

interest on the principal amount outstanding.

All financial assets not classified as measured at amortised cost or fair value through other comprehensive

income (FVOCI) as described above are measured at FVTPL. On initial recognition, the Company may

irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised

cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that

would otherwise arise.

- how the performance of the portfolio is evaluated and reported to the Company’s management;

- the risks that affect the performance of the business model (and the financial assets held within that

business model) and how those risks are managed;

Transfer of financial assets to third parties in transactions that do not qualify for derecognition are not

considered sales for this purpose consistent with the company's continiuing recognition of the assets.

Financial assets that are held for trading or are merged and whose performance is evaluated on a fair

value basis are measured at FVTPL.

- the frequency, volume and timing of sales of financial assets in prior periods, the reasons for

such sales and expectations about future sales activity.

Financial assets – Assessment whether contractual cash flows are solely payments of principal and

interest: Policy applicable from 1 January 2018

For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial

recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk

associated with the principal amount outstanding during a particular period of time and for other basic

lending risks and costs (e.g. liquidity risk and administrative costs), as well as a profit margin.

The Company makes an assessment of the objective of the business model in which a financial asset is

held at a portfolio level because this best reflects the way the business is managed and information is

provided to management. The information considered includes:

- the stated policies and objectives for the portfolio and the operation of those policies in practice. These

include whether management’s strategy focuses on earning contractual interest income, maintaining a

particular interest rate profile, matching the duration of the financial assets to the duration of any related

liabilities or expected cash outflows or realising cash flows through the sale of the assets;

Trade receivables issued are initially recognised when they are originated. All other financial assets and

financial liabilities are initially recognised when the Company becomes a party to the contractual provisions

of the instrument.

A financial asset (unless it is a trade receivable without a significant financing component) or financial

liability is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly

attributable to its acquisition or issue. A trade receivable without a significant financing component is

initially measured at the transaction price.

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TOTAL NIGERIA PLC


4.11 Financial instruments (cont'd)

iii

Financial assets

iv

- terms that may adjust the contractual coupon rate, including variable-rate features;

Financial assets – Subsequent measurement and gains and losses: Policy applicable from 1

January 2018

In assessing whether the contractual cash flows are solely payments of principal and interest, the Company

considers the contractual terms of the instrument. This includes assessing whether the financial asset

contains a contractual term that could change the timing or amount of contractual cash flows such that it

would not meet this condition. In making this assessment, the Company considers:

- contingent events that would change the amount or timing of cash flows;

- prepayment and extension features; and

- terms that limit the Company’s claim to cash flows from specified assets (e.g. non-recourse features).

A prepayment feature is consistent with the solely payments of principal and interest criterion if the

prepayment amount substantially represents unpaid amounts of principal and interest on the principal

amount outstanding, which may include reasonable additional compensation for early termination of the

contract. Additionally, for a financial asset acquired at a discount or premium to its contractual par amount,

a feature that permits or requires prepayment at an amount that substantially represents the contractual

par amount plus accrued (but unpaid) contractual interest (which may also include reasonable additional

compensation for early termination) is treated as consistent with this criterion if the fair value of the

prepayment feature is insignificant at initial recognition.

Financial assets – Policy applicable before 1 January 2018The Company classified its financial assets into one of the following categories into loans and receivables.

Loans and receivables

Measured at amortised cost using the effective interest method.

Financial assets – Subsequent measurement and gains and losses: Policy applicable before1 January 2018

These assets are subsequently measured at amortised cost using the effective interest method. The

amortised cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and

impairment are recognised in profit or loss. Any gain or loss on derecognition is recognised in profit or loss.

The Company derecognises a financial liability when its contractual obligations are discharged or cancelled,

or expire. The Company also derecognises a financial liability when its terms are modified and the cash

flows of the modified liability are substantially different, in which case a new financial liability based on the

modified terms is recognised at fair value. On derecognition of a financial liability, the difference between

the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or

liabilities assumed) is recognised in profit or loss.

Financial liabilities

Financial assets and financial liabilities are offset and the net amount presented in the statement of

financial position when, and only when, the Company currently has a legally enforceable right to set off the

amounts and it intends either to settle them on a net basis or to realise the asset and settle the liability

simultaneously.

Financial assets at amortised cost

Financial liabilities – Classification, subsequent measurement and gains and losses

The Company derecognises a financial asset when the contractual rights to the cash flows from the

financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in

which substantially all of the risks and rewards of ownership of the financial asset are transferred or in

which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and

it does not retain control of the financial asset. The Company enters into transactions whereby it transfers

assets recognised in its statement of financial position, but retains either all or substantially all of the risks

and rewards of the transferred assets. In these cases, the transferred assets are not derecognised.

Offsetting

Financial liabilities are classified as measured at amortised cost or FVTPL. A financial liability is classified

as at FVTPL if it is classified as held-for-trading, or it is designated as such on initial recognition. Financial

liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense,

are recognised in profit or loss. Other financial liabilities are subsequently measured at amortised cost

using the effective interest method. Interest expense and foreign exchange gains and losses are

recognised in profit or loss. Any gain or loss on derecognition is also recognised in profit or loss.

Derecognition

53

TOTAL NIGERIA PLC


4.12 Share capital

4.13 Statement of cash flows

4.14 Cash and cash equivalents

4.15 Inventories

The basis of costing inventories based on the product types are as follows:

Total purchase cost incurred at transaction date

Cost BasisProduct Type

Refined Petroleum Products

(AGO, ATK, PMS, DPK, LPFO, LPG)

Packaging Materials, Solar Lamps,

Lubricants, Greases, Special fuids and

Car care products

Inventories-in-transit

Weighted Average Cost

Net realisable value is the estimated selling price in the ordinary course of business, less the estimated

costs of completion and selling expenses. Inventory values are adjusted for obsolete, slow-moving or

defective items.

The statement of cash flows is prepared using the indirect method. Dividends paid to ordinary shareholders

are included in financing activities. Interest paid is also included in financing activities while interest

received is included in investing activities. Foreign exchange differential and interest claim on Petroleum

Support Fund (PSF) are included in operating activities.

The Company has only one class of shares namely ordinary shares. Ordinary shares are classified as

equity. When new shares are issued, they are recorded in share capital at their par value. The excess of

the issue price over the par value is recorded in the share premium reserve.

Inventories are measured at the lower of cost and net realisable value. The cost of blended

products/lubricants includes an appropriate share of production overheads based on normal operating

capacity.

Weighted Average Cost

Cash and cash equivalents comprise cash on hand, cash balances with commercial banks and Total

Treasury as well as call deposits with original maturities of three months or less. Bank overdrafts that are

repayable on demand and form an integral part of the Company’s cash management are included as a

component of cash and cash equivalents for the purpose of the statement of cash flows. Bank overdrafts

are shown within borrowings in current liabilities on the statement of financial position.

Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from

equity, net of any tax effects.

When shares recognised as equity are repurchased, the amount of the consideration paid, which includes

directly attributable costs, net of any tax effects, is recognised as a deduction from equity.

54

TOTAL NIGERIA PLC


4.16 Provisions

4.17 Employee benefits

i Defined contribution plan

Gratuity scheme

ii Other long-term employee benefits

iii Termination benefits

iv Short-term employee benefits

4.18 Government grant

Provisions comprise liabilities for which the amount and the timing are uncertain. They arise from environmental risks,

legal and tax risks, litigation and other risks. A provision is recognised when the Company has a present obligation

(legal or constructive) as a result of a past event for which it is probable that an outflow of resources will be required

and when a reliable estimate can be made regarding the amount of the obligation. Provisions are determined by

discounting the expected future cash flow at a pre-tax rate that reflects current market assessment of the value and the

risk specific to the liability. The unwinding of the discount is recognised in profit or loss as a finance cost.

However, possible obligations depending on whether or not certain future events occur are disclosed as contingent

liabilities.

A defined contribution plan is a post-employment benefit plan under which the Company pays fixed contributions into a

separate entity. The Company has no legal or constructive obligations to pay further contributions if the fund does not

hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related

service is provided.

A liability is recognised for the amount expected to be paid if the Company has a present legal or constructive

obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated

reliably.

Termination benefits are expensed at the earlier of when the Company can no longer withdraw the offer of those

benefits and when the Company recognises costs for a restructuring. If benefits are not expected to be settled wholly

within 12 months of the end of the reporting period, then they are discounted.

In line with the provisions of the Pension Reform Act 2014, the Company has instituted a defined contribution pension

scheme for its permanent staff. Employees contribute 8% of their Basic salary, Transport and Housing Allowances to

the Fund on a monthly basis. The Company’s contribution is 10% of each employee’s Basic salary, Transport and

Housing Allowances. Staff contributions to the scheme are funded through payroll deductions while the Company’scontribution is recognised in profit or loss as staff costs in the periods during which services are rendered by

employees.

The Company’s other long-term employee benefits represents a Long Service Award scheme instituted for all

permanent employees. The Company’s obligations in respect of this scheme is the amount of future benefits that

employees have earned in return for their service in the current and prior periods. The benefit is discounted to

determine its present value. The discount rate is the yield at the reporting date on Federal Government of Nigeria

issued bonds that have maturity dates approximating the term of the Company’s obligation. The calculation is

performed using the Projected Unit Credit method. Remeasurements are recognised in profit or loss in the period in

which they arise. This Scheme is not funded. The obligations are paid out of the Company’s cash flows as and when

due.

The Company operates a gratuity scheme for its employees in service before January 2001. This is funded by the

Company on a monthly basis, at a rate of contribution of 9.5% of total annual emolument and paid to Fund Managers

chosen by each employee.

The Company's obligation are extinguished once the amounts have been transferred to the Fund Managers.

Petroleum Products Pricing Regulatory Agency (PPPRA) subsidises the cost of importation of certain refined petroleum

products whose prices are regulated in the Nigerian market. The subsidies are recognised when there is reasonable

assurance that they will be recovered and the Company has complied with the conditions attached to receiving the

subsidy. The subsidies are recognised as a reduction to the landing cost of the subsidised petroleum product in the

year in which the Company makes the determination that all conditions have been met and the amount will be

recovered. Where the amounts relate to interest and foreign exchange differentials, they are recognised in profit or loss

when there is reasonable assurance that the amounts will be recovered.

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TOTAL NIGERIA PLC


4.19 Leases

Determining whether an arrangement contains a lease

Leased assets

4.20 Operating Profit

4.21 Measurement of fair values

- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities

-

-

Assets held by the Company under leases that transfer to the Company substantially all of the risk and reward of

ownership are classified as finance lease. The leased assets are measured initially at an amount equal to the lower of

the fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the assets are

accounted for in accordance with the accounting policy applicable to that asset.

Any other type of lease is an operating lease, and is not recognised in the statement of financial position.

At inception of an arrangement, the Company determines whether the arrangement is or contains a lease. At inception

or on reassessment of an arrangement that contains a lease, the Company seperates payment and other consideration

required by the arrangement into those for the lease and those for other elements on the basis of their relative fair

values.

If the Company concludes for a finance lease that is impracticable to separate the payment reliably, then an asset and

a liability are recognised at an amount equal to the fair value of the underlying asset. Subsequently, the liability is

reduced as payments are made and an imputed finance cost on the liability is recognised using the Company's

incremental borrowing rate.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly

(i.e. as prices) or indirectly (i.e. derived from prices)

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs)

The FAM regularly reviews significant unobservable inputs and valuation adjustments. If third party information, such

as broker quotes or pricing services, is used to measure fair values, then the FAM assesses the evidence obtained

from the third parties to support the conclusion that such valuations meet the requirements of IFRS, including the level

in the fair value hierarchy in which such valuations should be classified. Significant valuation issues are reported to the

Audit Committee and the Board of Directors.

Operating profit is the result generated from the continuing principal revenue producing activities of the Company as

well as other income and expenses related to operating activities. Operating profit excludes net finance costs and

income taxes.

Lease payments

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during

which the change has occurred.

Some of the Company’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values. The Final Account

Manager (FAM) has overall responsibility for overseeing all significant fair value measurements, including Level 3 fair

values, and reports directly to the Board of Directors.

Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the

lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the

lease. Minimum lease payments made under finance leases are apportioned between the finance income and the

reduction of the gross receivable. The finance income is allocated to each period during the lease term so as to

produce a constant periodic rate of return on the Company’s net investment in the lease.

If the inputs used to measure the fair value of an asset or a liability might be categorised in different levels of the fair

value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value

hierarchy as the lowest level input that is significant to the entire measurement.

When measuring the fair value of an asset or a liability, the Company uses market observable data as far as possible.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation

techniques as follows:

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TOTAL NIGERIA PLC


4.22 Changes in significant accounting policies.

As reported Adjustments

Amounts without

adoption of IFRS 15

₦'000 ₦'000 ₦'000 61,583,881 577,356 62,161,237

5,370,433 61,557 5,431,990

66,954,314 638,913 67,593,227

As reported Adjustments

Amounts without

adoption of IFRS 15

₦'000 ₦'000 ₦'000 307,987,896 (1,663,602) 306,324,294

1,451,424 1,086,246 2,537,670

(4,137,570) 61,557 (4,076,013)

305,301,750 (515,799) 304,785,951

The Company has initially applied IFRS 15 and IFRS 9 from 1 January 2018. A number of other new standards are also

effective from 1 January 2018 however, they do not have a material effect on the Company's financial statements.

Due to the transition methods chosen by the Company in applying these standards, comparative information throughout these

financial statements has not been restated to reflect the requirements of the new standards, except for certain requirements

for separately presenting impairment loss on trade and other receivables.

Tax liability

Tax expese

IFRS 9 contains three principal classification categories for financial assets: measured at amortised cost, FVOCI and FVTPL.

The classification of financial assets under IFRS 9 is generally based on the business model in which a financial asset is

managed and its contractual cash flow characteristics. IFRS 9 eliminates the previous IAS 39 categories of held to maturity,

loans and receivables and available for sale.

Classification and measurement of financial assets and financial liabilities

As a result of the adoption of IFRS 9, the Company has adopted consequential amendments to IAS 1 Presentation of

Financial Statements , which require impairment of financial assets to be presented in a separate line item in the statement of

profit or loss and other comprehensive income. Previously, the Company’s approach was to include the impairment of trade

receivables in administrative expenses. Consequently, the Company reclassified impairment losses amounting to ₦574.85million, recognised under IAS 39, from ‘administrative expenses’ to ‘impairment loss on trade receivables’ in the statement of

profit or loss and OCI for the year ended 31 December 2017.

Based on management's assessment, IFRS 15 did not have a material impact on the Company's accounting policies and

retained earnings. Based on the Company's business model, revenue is recognised at a point in time (at the point of sale).

Trade and other payables

Excerpt of statement of comprehensive income

31 December 2018

Revenue

Other income

IFRS 9 largely retains the existing requirements in IAS 39 for the classification and measurement of financial liabilities. The

adoption of IFRS 9 has not had a significant effect on the Company's accounting policies related to financial liabilities.

IFRS 15 Revenue from Contracts with Customers

The effect of initially applying these standards is mainly attributed to a change in impairment losses recognised on financial

assets.

IFRS 9 Financial Instruments

IFRS 9 sets out requirements for recognising and measuring financial assets, financial liabilities and some contracts to buy or

sell non-financial items. This standard replaces IAS 39 Financial Instruments: Recognition and Measurement.

The following tables summarise the impacts of adopting IFRS 15 on the Company’s statement of financial position as at 31

December 2018 and its statement of profit or loss and OCI for the year then ended for each of the line items affected.

31 December 2018

IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It

replaced IAS 18 Revenue , IAS 11 Construction Contracts and related interpretations. Under IFRS 15, revenue is recognised

when a customer obtains control of the goods or services. Determining the timing of the transfer of control – at a point in time

or over time – requires judgement. The Company has adopted IFRS 15 using the cumulative effect method (without practical

expedients), with the effect of initially applying this standard recognised at the date of initial application (i.e. 1 January 2018).

Accordingly, the information presented for 2017 has not been restated – i.e. it is presented, as previously reported, under IAS

18, IAS 11 and related interpretations. Additionally, the disclosure requirements in IFRS 15 have not generally been applied to

comparative information.

Excerpt of statement of financial position

Additionally, the Company has adopted consequential amendments to IFRS 7 Financial Instruments : Disclosures that are

applied to disclosures about 2018 but have not been generally applied to comparative information.

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TOTAL NIGERIA PLC


4.22

Note

Original classification under

IAS 39

New classification under

IFRS 9

Original carrying

amount under IAS 39

New carrying

amount under IFRS 9

₦'000 ₦'000Loans and receivables Amortised cost 28,270,336 28,646,574

Loans and receivables Amortised cost 12,162,802 12,162,802

40,433,138 40,809,376

₦'000 ₦'000Other financial liabilities Other financial liabilities 63,107,093 63,107,093

Other financial liabilities Other financial liabilities 13,135,023 13,135,023

76,242,116 76,242,116

IAS 39 carrying amount at

31 December 2017 Remeasurement

IFRS 9 carrying

amount at 1 January

2018

₦'000 ₦'000 ₦'000

Cash and cash equivalents:

Brought forward: Loans and receivables 12,162,802 - -

Carried forward: Amortised cost - - 12,162,802

Trade and other receivables:

Brought forward: Loans and receivables 28,270,336 - -

Remeasurement - 376,238 -

Carried forward: Amortised cost - 28,646,574 40,433,138 376,238 40,809,376

₦'000 (376,238)

120,396 (255,846)

₦'000

1,625,561

(376,238)

1,249,323

4.23 Joint arrangement

The following table and the accompanying notes below explain the original measurement categories under IAS 39 and the new

measurement categories under IFRS 9 for each class of the Company’s financial assets and financial liabilities as at 1 January 2018.

The effect of adopting IFRS 9 on the carrying amounts of financial assets at 1 January 2018 relates solely to the new impairment

requirements.

The following table reconciles the carrying amounts of financial assets under IAS 39 to the carrying amounts under IFRS 9 on transition

to IFRS 9 on 1 January 2018.

The Company has used an exemption not to restate comparative information for prior periods with respect to classification and

measurement (including impairment) requirements. Differences in the carrying amounts of financial assets and financial liabilities

resulting from the adoption of IFRS 9 are recognised in retained earnings and reserves as at 1 January 2018. Accordingly, the

information presented for 2017 does not generally reflect the requirements of IFRS 9, but rather those of IAS 39.

The following assessments have been made on the basis of the facts and circumstances that existed at the date of initial application.

Trade and other payables

Loss allowance at 1 January 2018 under IFRS 9

Additional information about how the Company measures the allowance for impairment is described in Note 26(iv).

IFRS 9 replaces the ‘incurred loss’ model in IAS 39 with an ‘expected credit loss’ (ECL) model. The new impairment model applies to

financial assets measured at amortised cost, contract assets and debt investments at FVOCI, but not to investments in equity

instruments. Under IFRS 9, credit losses are recognised earlier than under IAS 39. For assets in the scope of the IFRS 9 impairment

model, impairment losses are generally expected to increase and become more volatile. The Company has determined that the

application of IFRS 9’s impairment requirements at 1 January 2018 results in a reduction in allowance for impairment as follows.

Loss allowance at 31 December 2017 under IAS 39

Bank overdrafts

The following table summarises the impact, net of tax, of transition to IFRS 9 on retained earnings at 1 January 2018.

Impact of adopting

IFRS 9 at 1 January

2018

Changes in significant accounting policies. (Cont'd)

Trade and other receivables that were classified as loans and receivables under IAS 39 are now classified at amortised cost. A

decrease of ₦303.01 million in the allowance for impairment over these receivables was recognised in opening retained earnings at 1

January 2018 on transition to IFRS 9.

Financial assets

Amortised cost

Impairment of financial assets

Financial assets

Trade and other receivables

Cash and cash equivalents

Financial liabilities

Retained earnings

The Company’s joint arrangement is in respect of its interests in joint aviation facilities held with other parties. These financial

statements include the Company’s share of assets, liabilities, revenue, and expenses of the joint arrangement.

Impairment on financial assets

Related tax

Impact at 1 January 2018

Reduction in impairment recognised at 1 January 2018 on:

Trade and other receivables as at 31 December 2017

- The determination of the business model within which a financial asset is held.

Changes in accounting policies resulting from the adoption of IFRS 9 have been applied retrospectively, except as described below.

Transition

58

TOTAL NIGERIA PLC


5 Seasonality and Segment Reporting

Seasonality of Operations

The company's operations are such that revenue and cost are not affected by the impact of seasonality.

Segment Reporting

Reportable Segment Operations

Network Sales to service stations

General Trade Sales to corporate customers excluding customers in the aviation industry

Aviation Sales to customers in the aviation industry

5.1 Segment profit or loss (key items)

NETWORK

GENERAL

TRADE AVIATION TOTAL

₦'000 ₦'000 ₦'000 ₦'000Revenue 66% 203,272,011 25% 76,996,974 9% 27,718,911 100% 307,987,896

- Petroleum products 66% 170,920,227 23% 60,188,570 11% 27,718,911 100% 258,827,708

- Lubricant and others 66% 32,351,784 34% 16,808,404 0% - 100% 49,160,188

Gross profit 72% 25,048,846 23% 7,845,355 5% 1,891,018.29 100% 34,785,220

Finance income 84% 5,667,971 11% 742,234 5% 337,379 100% 6,747,584

Finance cost 84% (3,747,187) 11% (490,703) 5% (223,047) 100% (4,460,937)

Taxation 57% (2,358,415) 37% (1,530,901) 6% (248,254) 100% (4,137,570)

Writeback of Impairment allowance -4% 37,409 38% (355,384) 66% (617,246) 100% (935,221)

Depreciation and amortisation 98% (4,230,521) 2% (106,766) 0% (369) 100% (4,337,656)

NETWORK

GENERAL


₦'000 ₦'000 ₦'000 ₦'000

Revenue 74% 213,709,731 20% 57,544,847 6% 16,808,072 100% 288,062,650

- Petroleum products 75% 182,152,766 18% 43,663,514 7% 16,808,072 100% 242,624,352

- Lubricant and others 69% 31,556,966 31% 13,881,333 0% - 100% 45,438,299

Gross profit 77% 22,598,362 23% 6,608,316 0% 89,199 100% 29,295,878

Finance income 54% 1,388,050 44% 1,127,996 3% 73,831 100% 2,589,877

Finance cost 32% (984,159) 65% (1,992,307) 3% (87,342) 100% (3,063,808)

Taxation 80% (3,007,396) 34% (1,292,792) -14% 524,203 100% (3,775,985)

Increase/ (writeback) of Impairment allowance -19% 9,141 975% (460,311) -856% 403,962 100% (47,208)

Depreciation and amortisation 93% (3,259,855) 7% (250,592) 0% (393) 100% (3,510,840)

The following summary describes the operations of each reportable segment.

Products and services from which reportable segments derive their revenues

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.

The Board has given the Company's Chief Executive Officer (CEO) the power to assess the financial performance and position of the Company, allocate resources and make strategic

decisions. Segment reports that are reported to the CEO includes items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

Information reported to the Company's CEO for the purposes of resource allocation and assessment of segment performance is focused on the sales channels for the company's

products (petroleum products, lubricants and others). The principal sales channels are Network, General Trade and Aviation. The Company's reportable segments under IFRS 8 are

therefore as follows: Network, General Trade and Aviation.

Segment revenue reported below represents revenue generated from external customers. There were no inter-segment sales in the current period (2017: Nil). Performance is

measured based on segment which correspond with IFRS amounts in the Financial Statement.

31 December 2018

31 December 2017

59

TOTAL NIGERIA PLC


5.2 Segment assets and liabilities

NETWORK

GENERAL


₦'000 ₦'000 ₦'000 ₦'000

Non-current assets 79% 33,600,098 15% 6,483,559 6% 2,524,723 100% 42,608,380

Assets held-for-sale 79% - 15% - 6% - 100% -

Inventories 62% 18,628,010 29% 8,713,101 9% 2,704,066 100% 30,045,177

Receivables and prepayments 52% 27,962,068 41% 22,047,015 7% 3,764,125 100% 53,773,208

Cash and cash equivalents1

66% 4,024,193 25% 1,521,068 9% 548,757 100% 6,094,018

ASSETS 84,214,369 38,764,743 9,541,670 132,520,783

Addition to non-current assets 79% 5,418,630 15% 1,045,593 6% 407,158 100% 6,871,382

Payables, deferred income and current tax

liabilities 73% 45,073,482 22% 13,373,697 5% 3,316,331 100% 61,763,510

Borrowings1

66% 22,597,582 25% 8,541,454 9% 3,081,509 100% 34,220,544

Non-current liabilities 95% 5,499,317 3% 199,625 2% 106,898 100% 5,805,841

LIABILITIES 73,170,381 22,114,776 6,504,738 101,789,895

NETWORK

GENERAL


₦'000 ₦'000 ₦'000 ₦'000

Non-current assets 81% 29,070,789 13% 4,602,849 6% 2,063,361 100% 35,736,998

Assets held-for-sale 34% 39,931 66% 77,811 0% - 100% 117,742

Inventories 66% 17,646,369 25% 6,583,545 9% 2,436,326 100% 26,666,240

Receivables and prepayments 51% 17,113,524 38% 12,799,460 10% 3,385,107 100% 33,298,091

Cash and cash equivalents1

74% 9,023,416 20% 2,429,703 6% 709,683 100% 12,162,802

ASSETS 72,894,029 26,493,368 8,594,477 107,981,873

Addition to non-current assets 81% 4,538,755 13% 718,632 6% 322,148 100% 5,579,536

Payables, deferred income and current tax

liabilities 78% 49,583,966 19% 12,173,681 3% 2,046,238 100% 63,803,885

Borrowings1

74% 9,744,694 20% 2,623,918 6% 766,411 100% 13,135,023

Non-current liabilities 92% 2,591,996 6% 169,960 2% 55,458 100% 2,817,414

LIABILITIES 61,920,656 14,967,559 2,868,107 79,756,322

5.3 Geographic information

NIGERIA CONGO CAMEROON NIGER GABON TOTAL

₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000Revenue 307,244,803 293,523 409,894 19,003 20,672 307,987,896

Cost of Sales (272,629,097) (232,585) (302,904) (17,541) (20,549) (273,202,676) Gross Profit 34,615,706 60,938 106,990 1,462 123 34,785,220

NIGERIA CONGO CAMEROON NIGER GABON TOTAL

₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000Revenue 287,536,581 - 505,312 - 20,757 288,062,650

Cost of Sales (258,255,815) - (491,970) - (18,987) (258,766,772) Gross Profit 29,280,766 - 13,342 - 1,770 29,295,878

31 December 2018

The company does not hold non-current assets in these foreign countries.

The Company is domiciled in Nigeria. During the period, it sold products to some of its affiliates in Congo, Cameroon, Niger and Gabon.

The geographic information analyses the Company’s revenue and cost of sales by the Company’s country of domicile and other countries.

31 December 2018

31 December 2017

31 December 2017

1For the purpose of monitoring segment performance and allocating resources between segments, cash and borrowings are allocated to reportable segments on the basis of the

revenues earned by individual segments.

60

TOTAL NIGERIA PLC


FOR THE YEAR ENDED

6 Revenue

Revenue generated from the Company's revenue streams are as follows;

31 December 31 December2018 2017

₦'000 ₦'000258,827,708 240,560,869

49,160,188 47,501,781

307,987,896 288,062,650

7 Auditor's remuneration

The analysis of auditors' remuneration is as follows:


2018 2017

₦'000 ₦'000

36,023 31,500

Total audit fees 36,023 31,500

Other services1 - 7,547

Total fees 36,023 39,047

7.1


2018 2017

₦'000 ₦'000

Tax services 156,352 128,568

Information technology services 673,118 449,641

Litigation services 111,300 87,035

Recruitment and remuneration services 11,683 12,057

Air Total International subrogation fees 148,949 88,572

Product supply fees and certifications 117,382 58,640

Other services 47,770 33,675

1,266,554 858,188

8 Net finance income/ (costs)

measured at amortised costs


Finance income: ₦'000 ₦'000Petroleum Subsidy Fund (PSF) 5,996,994 1,866,332

Interest on unclaimed dividend 81,498 135,537

Finance lease income 282,110 297,493

Interest on deposits 386,982 290,515

Total finance income 6,747,584 2,589,877

Finance costs:

Interest on bank overdrafts and loans (4,460,937) (3,063,808)

Total finance costs (4,460,937) (3,063,808)

Net finance income/ (costs) 2,286,647 (473,931)

Petroleum products

Lubricants and others

The effect of initially applying IFRS 15 on the Company’s revenue from contracts with customers is described in

Note 4.2 and 4.22. Due to the transition method chosen in applying IFRS 15, comparative information has not

been restated to reflect the new requirements.

1Other services relates to the review of the Company's eligibility to claim the Work Experience Acquisition

Programme Relief (WEAPR) in accordance with the requirements of the Exemption of Profits Order 2012.

Statutory audit fees

Fees paid to professional consultants

61

TOTAL NIGERIA PLC


9 Other income and other expenses31 December 31 December

2018 2017

9.1 Other income ₦'000 ₦'000 Network income

1247,925 1,078,305

Other sundry income2

1,978 137,276

Gain on disposal of property, plant and equipment 1,201,521 103,142

Reversal and remeasurement of foreign exchange forward contract - 1,624,000

Net foreign exchange gain - 993,424

1,451,424 3,936,147

9.2 Other expenses

Net foreign exchange loss 1,324,883 -

1,324,883 -

10 Expenses by nature


2018 2017

₦'000 ₦'000 Changes in inventory of lubes, greases and refined products 269,259,591 254,872,410

Custom duties 1,999,241 1,975,582

Transport of supplies 1,943,844 1,865,679

Distribution costs 4,470,363 2,719,209

Staff costs (Note 31(iii)) 8,815,810 8,240,675

Depreciation (Note 16) 4,306,166 3,460,906

Amortisation of software (Note 15) 31,490 49,934

Rent 775,283 817,621

Maintenance expenses 1,289,090 1,509,107

Motor fuels and travelling expenses 1,304,863 1,237,738

Communication, computer and stationery expenses 405,596 354,779

Directors' remuneration (Note 30.3) 248,508 259,105

Bank charges 80,973 128,274

Business promotion and publicity 558,319 580,701

Other expenses 109,005 78,295

Security & guarding 280,235 297,954

Write back of impairment allowance (935,221) (622,057)

Bad debts written off/ (recovered) 572,595 (9,335)

Fees paid to professional consultants (Note 7.1) 1,266,554 858,188

Purchase of consumables 102,879 62,678

Insurance 167,384 178,157

Service charge 145,809 12,331

Levies 150,447 89,485

Entertainment expenses 67,990 60,951

Engineering studies 165,272 37,321

Auditor's Remuneration (Note 7) 36,023 39,047

Total cost of sales, selling & distribution costs and administrative expenses 297,618,109 279,154,735

1Network income represents income from Bonjour shop, rent, vendor management fees and other miscellaneous income.

(2017: included sales of solar products which has been recognised in 2018 as revenue in line with IFRS)2Other sundry income relates to royalties received from dealers for services rendered at the stations different from the

Company's core line of business.

62

TOTAL NIGERIA PLC


11 Company Income Tax

Income tax expense

11.1.1 Amounts recognised in profit or loss


2018 2017

₦'000 ₦'000Current tax expenses:

Company Income Tax (CIT) 1,368,234 1,038,832

Tertiary Education Tax (TET) 222,004 182,689

Capital gains tax 105,043 4,622

Current year tax expense 1,695,281 1,226,143

Withholding tax credit notes recovered (414,486) -

1,280,795 1,226,143

Deferred tax

Origination and reversal of temporary differences (Note 11.3) 2,856,775 2,549,842

4,137,570 3,775,985

11.1.2 Reconciliation of effective tax rate


2018 2017

₦'000 ₦'000

Profit before tax 12,098,463 11,795,283

Income tax using the statutory tax rate (30%) 30% 3,629,539 3,538,585

Effect of tertiary education tax rate (2%) 241,969 235,906

Capital gains tax 105,043 4,622

Non-deductible expenses 277,761 47,601

Tax incentives (150,812) (129,886)

Withholding tax credit notes recovered (414,486) -

Impact of IFRS 9 143,831 -

Changes in prior year estimate 243,697 -

Other differences 316 11,963

Difference in CIT and TET rates 60,712 67,194

4,137,570 3,775,985

11.2 Movement in current tax liability 31 December 31 December

2018 2017

₦'000 ₦'000

Balance as at 1 January 305,171 6,388,307

Net provision for the year (Note 11.1.1) 1,280,795 1,226,143

Payments during the year (981,723) (6,743,576)

Withholding tax credit notes (463,149) (565,703)

Balance as at 31 December 141,094 305,171

The tax charge for the year has been computed after adjusting for certain items of expenditure and income, which are

not deductible or chargeable for tax purposes and comprises:

63

TOTAL NIGERIA PLC


11.3 Deferred taxation

Deferred tax assets and liabilities are attributable to the following;

31 December 31 December 31 December 31 December 31 December 31 December

2018 2017 2018 2017 2018 2017

₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000

Property, plant and equipment - - (1,354,647) (4,320,060) (5,674,707) (4,320,060)

Provision for doubtful debts - 495,603 (344,769) - 150,834 495,603

Provision for employee benefits 5,522 133,808 - - 139,330 133,808

Provision for inventory - 24,583 - - 24,583 24,583

Unrealised foreign exchange differences - 1,272,804 (1,283,277) - (10,473) 1,272,804

5,522 1,926,798 (2,982,693) (4,320,060) (5,370,433) (2,393,262)

Movement in deferred tax balances during the year;

Balance

1 January

2017

Recognised in

profit or loss

Balance

31 December

2017

Recognised in

profit or loss

Recognised in

equity

Balance

31 December

2018

₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000

Property, plant and equipment (3,740,659) (579,402) (4,320,060) (1,354,646) - (5,674,707)

Provision for doubtful debts 510,061 (14,458) 495,603 (224,373) (120,396) 150,834

Provision for employee benefits 71,614 62,195 133,808 5,522 - 139,330

Provision for inventory 27,570 (2,987) 24,583 - - 24,583

Unrealised foreign exchange difference 3,287,994 (2,015,190) 1,272,804 (1,283,277) - (10,473)

156,580 (2,549,842) (2,393,262) (2,856,774) (120,396) (5,370,433)

11.4 The charge for income tax in these financial statements is based on the provisions of the Companies Income Tax Act CAP C21 LFN 2004 (as

amended) and the tertiary education tax charge is based on the Tertiary Education Trust Fund Act, 2011.

Assets Liabilities Net

64

TOTAL NIGERIA PLC


12

13 Dividends

Declared dividends

The following dividends were declared by the Company during the year.


2018 2017

₦'000 ₦'000Final dividend:

₦14.00 per qualifying ordinary share (2017: ₦7.00) 4,753,306 2,376,652

Interim dividend:

₦3.00 per qualifying ordinary share (2017: ₦3.00) 1,018,566 1,018,566

5,771,872 3,395,218

13.1 Dividend payable 31 December 31 December

2018 2017

₦'000 ₦'000

Balance as at 1 January 2,022,830 5,225,573

Final dividend (prior year) 4,753,306 2,376,652 Interim dividend (current year) 1,018,566 1,018,566

7,794,702 8,620,791

Forfeited dividend (Note 13.1(a)) (60,470) (31,374)

Dividend paid (2,997,605) (6,566,587)

Balance as at 31 December 4,736,627 2,022,830

(a)

Employee benefits

Employee benefits represents the Company's liability for long service awards. Staff who have attained the milestones for the

specified number of years of service in the Company (i.e. 10 years, 15 years and 20 years) are rewarded with cash and gift items

as long service awards.

An additional provision of ₦88.10 million has been made during the year ended 31 December 2018 (2017: ₦219.86 million). See note 31 (iii). Payment of ₦70.85 million (2017: ₦25.50 million) was made to qualifying employees during the year.

By the provision of the Companies and Allied Matters Act, dividend which remain unclaimed for 12 years stand forfeited.

65

TOTAL NIGERIA PLC


14 Earnings per share (EPS)

Basic earnings per share

The company has no dilutive potential ordinary shares and as such, diluted and basic earnings per share are the same.


2018 2017

Earnings

Profit for the year attributable to shareholders (expressed in Naira) 7,960,893,000 8,019,298,000

Number of shares

339,521,837 339,521,837

23.45 23.62

15 Intangible assets

The movement on these accounts were as follows:

Cost ₦'000Balance as at 1 January 2017 383,361

Additions 26,536

Disposals (11,162)

Balance as at 31 December 2017 398,735

Balance as at 1 January 2018 398,735

Additions 6,861

Disposals -

Balance as at 31 December 2018 405,596

Amortisation

Balance as at 1 January 2017 (309,391)

Additions (49,934)

Disposals 11,162

Balance as at 31 December 2017 (348,163)

Balance as at 1 January (348,163)

Charge for the year (31,490)

Disposals -

Balance as at 31 December (379,653)

Carrying amount

At 1 January 2017 73,970

At 31 December 2017 50,572

At 31 December 2018 25,943

1Amortisation of intangible assets are included in administrative expenses in Profit or Loss.

Basic earnings per share of ₦23.45 (December 2017: ₦23.62) is based on profit attributable to ordinary shareholders of ₦7.96 Billion (December 2017: ₦8 Billion), and on the 339,521,837 ordinary shares of 50 kobo each, being the weighted average number of ordinary shares in issue during the year (December 2017: 339,521,837 ordinary shares).

Weighted average ordinary shares of 50 kobo each

Basic earnings per 50 kobo share (expressed in Naira)

The denominators for the purposes of calculating basic earnings per share are based on issued and paid ordinary shares of 50

kobo each as at 31 December 2018.

Computer software

and software

licensing

66

TOTAL NIGERIA PLC


16 Property, plant and equipment

The movement on these accounts were as follows:

Total

₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000Cost

Balance as at 1 January 2017 4,262,189 12,691,275 12,247,504 558,233 11,067,453 2,005,510 4,063,665 46,895,829

Additions 84,554 422,370 1,105,741 432 658,022 121,023 4,786,907 7,179,048

Transfers (Note 16.1) 431,613 715,436 1,709,255 4,264 1,502,779 100,215 (4,692,672) (229,110)

Disposals (667) (24,851) (172,831) (2,307) (36,140) (460,684) - (697,480)

Reclassification to assets held-for-sale - (21,686) (405,548) (5,992) (85,569) (52,055) - (570,851)

Balance as at 31 December 2017 4,777,689 13,782,544 14,484,121 554,630 13,106,545 1,714,009 4,157,900 52,577,436

Balance as at 1 January 2018 4,777,689 13,782,544 14,484,121 554,630 13,106,545 1,714,009 4,157,900 52,577,436

Additions 15,167 87,264 989,490 3,271 419,322 429,945 7,865,058 9,809,517

Transfers (Note 16.1) 89,807 1,574,739 2,593,395 18,915 1,116,766 532,236 (6,068,927) (143,069)

Disposals - (117,014) (159,231) (345) (96,826) (37,503) - (410,919)

Reclassification from assets held for sale - 21,261 257,119 5,992 85,145 52,055 - 421,572

Balance as at 31 December 2018 4,882,663 15,348,794 18,164,894 582,463 14,630,952 2,690,742 5,954,031 62,254,537

Accumulated depreciation and impairment

Balance as at 1 January 2017 (525,294) (4,157,209) (7,606,739) (556,423) (7,677,470) (1,144,645) - (21,667,780)

Charge for the year (79,293) (590,216) (1,139,628) (5,846) (1,329,482) (316,441) - (3,460,906)

Eliminated on disposals - 14,886 119,113 2,305 30,431 451,221 - 617,956

Reclassification to assets held-for-sale - 9,664 309,816 5,985 75,589 52,055 - 453,109

Balance as at 31 December 2017 (604,587) (4,722,875) (8,317,438) (553,979) (8,900,932) (957,810) - (24,057,620)

Balance as at 1 January 2018 (604,587) (4,722,875) (8,317,438) (553,979) (8,900,932) (957,810) - (24,057,621)

Charge for the year (84,139) (654,692) (1,505,816) (17,704) (1,609,331) (434,484) - (4,306,166)

Eliminated on disposals - 62,164 156,951 345 72,431 37,503 - 329,394

Reclassification from assets held for sale - (8,313) (209,873) (5,978) (68,941) (52,055) - (345,160)

Charge on assets reclassed held for sale - (926) (12,128) (7) (6,267) - - (19,328)

Balance as at 31 December 2018 (688,726) (5,324,642) (9,888,304) (577,323) (10,513,040) (1,406,846) - (28,398,881)

Carrying amount

At 1 January 2017 3,736,895 8,534,066 4,640,765 1,810 3,389,983 860,865 4,063,665 25,228,049

At 31 December 2017 4,173,102 9,059,669 6,166,682 652 4,205,613 756,199 4,157,900 28,519,816

At 31 December 2018 4,193,937 10,024,152 8,276,590 5,140 4,117,912 1,283,896 5,954,031 33,855,656

16.1

16.2 Asset held-for-sale

(a) Assets of disposal group held for sale

Buildings

Plant,

machinery

and fittings

Office

equipment

and furniture

Computer

equipment

and other

tangibles

Motor

vehicles Total₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000

Cost

Balance as at 1 January 2017 - - - - - -

Reclassification to assets held-for-sale 21,686 405,548 5,992 85,569 52,055 570,850

- - - - - -

21,686 405,548 5,992 85,569 52,055 570,850

21,686 405,548 5,992 85,569 52,055 570,850

(425) (148,429) - (424) - (149,278)

Reclassification to PPE (21,261) (257,119) (5,992) (85,145) (52,055) (421,572)

Balance as at 31 December 2018 - - - - - -

Balance as at 1 January 2017 - - - - - -

Reclassification to assets held-for-sale (9,664) (309,816) (5,985) (75,589) (52,055) (453,109)

- - - - - -

(9,664) (309,816) (5,985) (75,589) (52,055) (453,109)

Balance as at 1 January 2018 (9,664) (309,816) (5,985) (75,589) (52,055) (453,109)

Eliminated on disposal - LPG assets 425 87,816 - 381 - 88,622

Reclassification to PPE 9,239 222,000 5,985 75,208 52,055 364,487

- - - - - -

At 1 January 2017 - - - - - -

At 31 December 2017 12,022 95,733 7 9,980 - 117,742

At 31 December 2018 - - - - - -

No item of property, plant and equipment has been pledged as security.

Transfers represent additions to other categories of PPE as well as from period's work-in-progress as they become completed. Capital work in progress items include construction and other

tangible asset awaiting completion.

Balance as at 1 January 2018

Accumulated depreciation and impairment

Disposal - LPG assets

Balance as at 31 December 2017

Motor

vehicles

Capital

work in

progress

Plant,

machinery

and fittingsBuildings

Computer

equipment and

other tangibles

Dispoasl - LPG assets

Leasehold

land

Balance as at 31 December 2017

Office

equipment

and

furniture

At 31 December 2018, the LPG disposal group was carried at the net book value. The Company performed an assessment of the recoverable value (fair value less costs to sell) of the

assets using the third party quotations received, and compared the recoverable amount to the carrying value. Based on its assessment, the recoverable value of the assets is higher than the

carrying amount and assets have therefore been valued using their carrying amount.

In December 2018, the Company ceased its efforts to dispose its LPG assets held for sale. These assets have been reassigned to new plants and alternative uses within the company's

production production have been found for the assets. Consequently, assets held for sale have been reclassified back to property, plant and equipment.

Carrying amount

Disposal - LPG assets

67

TOTAL NIGERIA PLC


17 Inventories

Inventories comprise:


2018 2017

₦'000 ₦'000Raw materials 4,512,056 310,154

Goods in transit 2,956,259 3,401,007

Finished goods 21,243,097 21,756,197

Consumable equipment and spares 1,333,765 1,198,882

30,045,177 26,666,240

17.1 Movement in write down of inventory


₦'000 ₦'000 402,333 339,914

22,533 352,719

(23,899) (290,300)

400,967 402,333

18 Trade and other receivables (Current) 31 December 31 December

2018 2017

₦'000 ₦'00024,494,941 14,627,397

669,054 367,831

25,163,995 14,995,228

Net investment in finance lease 1,540,645 671,340

Advance on letters of credit 4,616,913 4,642,860

Bridging claims 9,814,009 2,242,222

Receivable from Petroleum Support Funds 6,248,648 251,654

Unclaimed dividends 1,743,332 1,441,302

Employee receivables 727,873 485,289

Advance to supplier 1,202,439 6,677,809

Other receivables 949,916 1,318,664

26,843,775 17,731,140

52,007,770 32,726,367


18.1 Trade and other receivables (Non-current) 2018 2017

Non-current portion of trade and other receivables comprise: ₦'000 ₦'000Employee receivables 847,164 682,620

Net investment in finance lease (Note 18.1.1) 677,675 2,192,775

1,524,839 2,875,395

18.1.1


2018 2017

₦'000 ₦'000Gross investment in finance lease receivable 3,077,321 3,973,186

Unearned finance income (859,000) (1,109,071)

Net investment in finance lease 2,218,321 2,864,115


2018 2017

₦'000 ₦'000Less than one year 1,540,645 671,340

Between one and three years 677,676 2,192,775

2,218,321 2,864,115

1During the year, amounts of ₦22.5 million (2017: ₦325.5 million) were written down and recognised in cost of sales.

Customers account

Total trade receivables

Balance as at 31 December

Due from related parties (Note 30.2)

Finance lease receivable

Balance as at 1 January

Write down of inventory1

Reversal of prior year write down

Total other receivables

The company leases transport equipment to some of its transporters under a finance lease arrangement. The lease term is between

three to five years, with options to extend. The finance lease receivables at the end of the reporting period are neither past due nor

impaired. At 31 December 2018, the carrying amount of leased equipment was ₦2.22 billion (2017: ₦2.86 billion). The carrying amount of the finance lease receivables approximates their fair value and may be analysed as follows:

Net investment in finance lease

68

TOTAL NIGERIA PLC


18.2


2018 2017

₦'000 ₦'000 17,837,562 10,410,270

5,414,358 2,837,320

1,003,324 295,464

908,751 1,452,173

25,163,995 14,995,227

18.3

19 Prepayments


2018 2017

₦'000 ₦'000Current

Prepaid rent 664,794 215,288

Employee advances 1,100,644 356,436

1,765,438 571,724

Non-current

Long term prepaid network assets 7,109,652 4,233,253

Prepaid rent 92,289 57,964

Total non-current prepayment 7,201,941 4,291,217

Total prepayments 8,967,379 4,862,941


2018 2017

20 Borrowings ₦'000 ₦'000

22,148,472 9,575,060

12,072,072 3,559,963

Total borrowings 34,220,544 13,135,023

-

- The carrying amount of current borrowings is a reasonable approximation of fair value as at 31 December, 2018.

The principal features of the Company’s borrowings are as follows:

Unsecured borrowings at amortised cost

Bank overdrafts (Note 23)

Trade finance loan

Bank overdrafts are repayable on demand. The average interest rate on bank overdrafts for the year was approximatey 16.07% per

annum (2017: 19.0% per annum). This was determined based on banks' cost of funding plus lenders' mark-up. These overdrafts are

neither guaranteed nor is any collateral given on the balances.

Trade finance loan represents short term borrowings obtained to fund letters of credits for product importation.

The long term prepaid network assets relate to amounts paid in advance for leased stations, as well as lands on which stations and

other Company installations are built.

Non-current and current prepayments mainly represent long term prepaid network assets, advance payment for rent and insurance

expenses.

Management believes that the unimpaired amounts that are past due by more than 90 days are still collectible in full based on the

historical payment pattern and extensive analysis of customer credit risk.

The Company considers its receivables to be impaired when normal collection methods fail and the receivables are referred to the legal

team/collection agents.

Ageing of impairments

91 - 180 days past due

Neither past due nor impaired

0 - 90 days past due

As at 31 December 2018, the ageing of trade receivables that were not impaired was as follows:

Above 180 days past due

69

TOTAL NIGERIA PLC


21 Trade and other payables 31 December 31 December

2018 2017

₦'000 ₦'000Trade payables :

Amount due to related companies (Note 30.2) 6,985,111 23,852,874

12,424,899 5,632,367 Bridging contribution 11,986,663 4,202,064

Payable to Petroleum Support Fund 616,869 616,869

32,013,542 34,304,174

Other payables:

Sundry creditors 2,515,755 6,110,212

Security deposits 4,360,278 6,143,559

Accrued liabilities 17,812,083 14,753,536

Dividend payable (Note 13.1) 4,736,627 2,022,830

Pay As You Earn (PAYE) 55,267 55,759

Staff pension 87,478 26,720

Staff gratuity 2,851 3,143

29,570,339 29,115,759

Total trade and other payables 61,583,881 63,419,933


21.2 Deferred income (current) 2018 2017₦'000 ₦'000

Rental services 38,535 20,571

Advance received for solar distribution - 58,210

38,535 78,781

31 December 31 December21.3 Deferred income (non current) 2018 2017

₦'000 ₦'000Rental services - 6,000

- 6,000


2018 2017

22 Share capital ₦'000 ₦'000

169,761 169,761


2018 2017

₦'000 ₦'00023 Cash and cash equivalents

Bank and cash balances 2,688,916 7,232,623

Cash balances with Total Treasury (Note 30.2) 3,405,102 4,930,179

Cash & cash equivalents in statement of financial position 6,094,018 12,162,802

Bank overdrafts (Note 20) (22,148,472) (9,575,060)

Cash & cash equivalents in statement of cash flows (16,054,454) 2,587,742

All ordinary shares rank equally with regard to the Company's residual assets. Holders of these shares are entitled to dividends as

declared from time to time and are entitled to one vote per share at general meetings of the Company.

The directors believe that the amounts held with Total Treasury qualify as cash and cash equivalents because they can be

withdrawn at any time without penalty.

Accrued liabilities principally comprise accrual for product bills and other charges for which invoices were not yet received at the

end of the year.

Authorised, Issued and fully paid:

339,521,837 ordinary shares of 50 kobo each

The Directors consider that the carrying amount of trade payables as at 31 December 2018 approximates their fair value.

Information about the Company’s exposure to currency and liquidity risks is included in Note 26(iii).

Trade creditors

Trade and other payables principally comprise amounts outstanding for trade purchases and ongoing costs.

The deferred income represents amounts billed and collected in accordance with contractual terms in advance of when the goods

are delivered or services rendered. These advance payments primarily relate to the rental income and prepaid revenue for goods

and services yet to be rendered. The Company estimates this will be earned as revenue during the subsequent financial periods.

70

TOTAL NIGERIA PLC


24 Commitments and contigent liabilities

Financial commitments

The Company did not charge any of its assets to secure liabilities of third parties.


2018 2017

Bonds ₦'000 ₦'000

Total commitments given 2,000,350 2,500,350

Total commitments received 590,000 -

There are contingent liabilities in respect of legal actions against the Company amounting to

approximately ₦1.27 trillion (2017: ₦1.26 trillion). The Directors have not made provisions for these

contingent liabilities as consultation with the in-house legal team (who holds regular discussions and

get expert opinion from the Company’s external solicitors) has indicated that no material losses will

crystalise against the Company.

The Directors are of the opinion that all known liabilities and commitments have been taken into

account in the preparation of these financial statements. These liabilities are relevant in assessing the

Company's state of affairs.

At 31 December 2018, the Company had contractual commitments for the acquisition of property,

plant and equipment amounting to ₦3.9 Billion (2017: ₦4.5 Billion).

Commitments received include customers' guarantees.

Commitments received and given are held with local banks.

Contingent liabilities

Commitments given primarily include guarantee to Pipelines and Products Marketing Company

Limited (PPMC) for bulk purchase of petroleum products and Nigeria Customs Service for duties and

taxes in the ordinary course of business. No losses are anticipated in respect of these.

71

TOTAL NIGERIA PLC


25 Capital management

The Company is not subject to any externally imposed capital requirements.

Gearing ratio

The gearing ratio is as follows:


2018 2017

₦'000 ₦'000Borrowings (Note 20) 34,220,544 13,135,023

Cash and cash equivalents (Note 23) (6,094,018) (12,162,802)

Net debt 28,126,526 972,221

Equity 30,730,888 28,225,551

Net debt to equity ratio 0.89:1 0.03:1

The capital structure of the Company consists of debt, which includes the borrowings disclosed in Note 20,

cash and cash equivalents and equity attributable to equity holders, comprising issued capital, reserves and

retained earnings.

Borrowing is defined mainly as long and short-term borrowings.

Equity includes all capital and reserves of the Company that are managed as capital.

The Company manages its capital to ensure that the Company will be able to continue as a going concern

while maximising the return to stakeholders through the optimisation of its debt and equity balance. The

Company’s overall strategy remains unchanged from prior period.

72

TOTAL NIGERIA PLC


26 Financial risk management

(i) Financial risk management objectives

(ii) Market risk

Interest rate risk management

Interest rate risk

Sensitivity analysis


2018 2017₦'000 ₦'000

Variable rate instruments

Borrowings (Note 20) 34,220,544 13,135,023

34,220,544 13,135,023

Sensitivity analysis for variable rate instruments

Change of 500 basis points or 5%

₦'000 ₦'00031 December 2018 4,460,937 '+/-5 % 1,354,261

31 December 2017 3,063,808 '+/-5 % 758,963

Effect of increase/decrease in

Interest rate

A change of 500 basis points in interest rates at the reporting date would have increased (decreased) equity and profit

or loss by the amounts shown below:

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices

will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk

management is to manage and control market risk exposures within acceptable parameters, while optimising the

return.

The Company manages market risks by keeping costs low through various cost optimisation programs. Moreover,

market developments are monitored and discussed regularly, and mitigating actions are taken where necessary.

Interest

charged

At the reporting date the interest rate profile of the Company's interest-bearing financial instruments was:

The Company is exposed to interest rate risk as it borrows funds at multiple interest rates. The risk is managed by the

Company by constantly negotiating with the banks to ensure that interest rates are consistent with the monetary policy

rates as defined by the Central Bank of Nigeria.

The Company’s Treasury function provides services to the business, co-ordinates access to domestic and

international financial markets, monitors and manages the financial risks relating to the operations of the Company

through internal risk reports which analyses exposures by degree and magnitude of risks. These risks include market

risk (including currency risk, interest rate risk), credit risk and liquidity risk.

The Company's Treasury function reports monthly to the Group's Treasury, a section of the Group that monitor's risk

and policies implemented to mitigate risk exposures.

73

TOTAL NIGERIA PLC


26 Financial Risk Management (cont'd)

Foreign exchange risk management

Effect in thousands of Naira

As at 31 December 2018

Foreign currency Naira balance Exchange rate*

'000 '000 N '000

Trade receivables

USD 4,464 1,568,335 351.33 '15% 235,250

Euro (11,562) (4,607,110) 398.47 '15% (691,067)

Cash deposits

USD 13,783 4,842,376 351.33 '15% 726,356

EURO 187 74,514 398.47 '15% 11,177

Trade payables

USD (34,256) (12,035,148) 351.33 '15% (1,805,272)

EURO (2,758) (1,098,980) 398.47 '15% (164,847)

GBP (43) (19,085) 443.84 '15% (2,863)

CHF (20) (7,236) 361.79 '15% (1,085)

Net impact on profit or loss

USD (16,009) (5,624,437) 351.33 15% (843,666)

EURO (14,133) (5,631,576) 398.47 15% (844,737)


Foreign currency Naira balance Exchange rate

'000 '000 N '000

Trade receivables

USD 2,690 867,821 322.61 '15% 130,173

Euro - - - '15% -

Cash deposits

USD 20,723 6,685,447 322.61 '15% 1,002,817

EURO - - 376.38 '15% -

Trade payables

USD (73,911) (23,844,428) 322.61 '15% (3,576,664)

EURO (10,733) (4,039,687) 376.38 '15% (605,953)

Net impact on profit or loss

USD (50,498) (16,291,160) 322.61 15% (2,443,674)

EURO (10,733) (4,039,687) 376.38 15% (605,954)

A movement in the exchange rate either positively or negatively by 15 percent is illustrated below. Such movements would have increased (decreased) the profit or loss

by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Company considered to be reasonably possible at the end of the

reporting period. The analysis assumes that all other variables, in particular interest rates, remain constant.


exchange rate

A decrease in exchange rate by 15 percent (2017: 15 percent) against the above currencies at the reporting period would have had the equal but opposite effect on the

above currencies to the amounts shown above, on the basis that all other variables remain constant.

*These exchange rates have been derived by computing the weighted average of the CBN intervention rate, Interbank rate, and NAFEX which represents the Company's

expected pattern of realisation and settlement.


exchange rate

74

TOTAL NIGERIA PLC


Financial Risk Management (cont'd)

(iii) Liquidity risk management

Liquidity and interest risk tables

Total

As at 31 December 2018 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000Borrowings (Note 20) 34,220,544 34,220,544 22,148,472 12,072,072 -

Trade payables (Note 21) 32,013,542 32,013,542 12,424,899 7,601,980 11,986,663

Other payables1

(Note 21) 28,902,610 28,902,610 10,333,892 9,709,294 8,859,424

95,136,696 95,136,696 44,907,263 29,383,346 20,846,087

31 December 2017

Borrowings (Note 20) 13,135,023 13,135,023 9,575,060 3,559,963 -

Trade payables (Note 21) 34,304,174 34,304,174 5,632,367 24,469,743 4,202,064

Other payables1

(Note 21) 28,802,919 28,802,919 10,298,248 9,675,804 8,828,866

76,242,116 76,242,116 25,505,675 37,705,510 13,030,930

1The amount of other payables does not include statute-based deductions.

Financing facilities

2018 2017

₦'000 ₦'000Amount used 34,220,544 13,135,023

Amount unused 58,779,456 52,414,958

Total Facilities 93,000,000 65,549,981

Unsecured bank loans which are revolving trade loans with a tenure of one year and overdrafts payable at call are reviewed annually.

The Company manages liquidity risk by maintaining reserves, banking facilities by monitoring forecasts and actual cash flows and matching the maturity profiles of

financial assets and liabilities. Below is a listing of financing facilities that the Company has at its disposal to further reduce liquidity risk.

The following tables detail the Company’s remaining contractual maturity for its derivative and non-derivative financial liabilities with agreed repayment periods. The tables

have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. To the extent

that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the reporting period. The contractual maturity is based on

the earliest date on which the Company may be required to pay.

Less than

1 month 1 to 3 months

3 months

to 1 year

Contractual cashflows

Carrying amount

75

TOTAL NIGERIA PLC



(iv) Credit risk management

Cash and cash equivalents


Not Credit Impaired Credit Impaired Total

₦'000 ₦'000 ₦'000

Trade receivables 24,961,271 202,724 25,163,995

As at 31 December 2017Comparative information under IAS 39

Fully performing Past due Total

₦'000 ₦'000 ₦'000

Trade receivables 10,410,270 4,584,957 14,995,228

An analysis of the credit quality of trade receivables that are neither past due nor impaired is as follows;

Network Channel: Credit is extended to dealers who operate the Company Owned, Dealer Operated Service Station

(CODO) and some of the Dealer Owned, Dealer Operated service stations (DODO) who specifically apply to operate under

the DODO credit scheme. Under both CODO and DODO credit schemes, credit is extended to each dealer to cover the

working capital needs of the station. Each day's sales proceeds are lodged into the Company's bank accounts at least twice

daily. The Company's financial risk exposure is covered by retentions from dealers income to increase the security deposit,

as well as retention of title over physical stock in the station in event of non payment.

General Trade (GT) Channel: Credit for the GT customers is set at the monthly average sales to the customer for a year of

one year or six months after proper financial and qualitative analysis. The approved credit limit is extended for 30 days or 45

days in rare occassions for blue chip companies.

The Company obtains bank guarantees in its favour for transactions with certain customers. These guarantees are held with

Nigerian banks as a form of security in the event of a default.

Aviation Channel: Most of the customers are on a cash and carry basis with the exception of a few companies with 15 days

credit limit. Credit is given only after a year of three months sales to the customer. Sales to international customers are based

on a contract of one year and credit amount is based on expected turnover. Sales to international customers are guaranteed

by Air Total International, a related party and the risk of loss in this circumstance is nil.

The Company held cash and cash equivalents of ₦16.05 million (net overdraft) at 31 December 2018 (2017: ₦2.59 million).

The cash and cash equivalents are held with bank and financial institution counterparties with high credit-ratings assigned by

international credit-rating agencies or Total Treasury, a related entity within the Total Group.

On initial application of IFRS 9, the Company did not recognise an impairment allowance as at 1 January 2018. This did not

change during 2018.

Impairment on cash and cash equivalents has been measured on a 12-month expected loss basis and reflects the short

maturities of the exposures. The Company considers that its cash and cash equivalents have low credit risk based on the

external credit ratings of the counterparties.

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the

Company. The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient

collateral where appropriate e.g. security deposits, as a means of mitigating the risk of financial loss from defaults. The

Company uses other publicly available financial information and its own trading records to rate its major customers. Credit

exposure is controlled by setting credit limits that are routinely reviewed and approved by the management.

The Company does not have any significant credit risk exposure to any single counterparty or any group of counterparties

having similar characteristics. The Company defines counterparties as having similar characteristics if they are related

entities.

The credit policy of Total Nigeria Plc. is set in accordance with the sales channel that the Customer belongs to:

76

TOTAL NIGERIA PLC




2018 2017

₦'000 ₦'000Customers 24,494,941 14,627,397

Due from related parties 669,054 367,830

Due from regulators (Government entities) 16,062,657 2,493,876

Other receivables 2,474,755 4,194,059

43,701,407 21,683,162

Due from related parties

Due from Government entities

Other receivables

Expected credit loss assessment for customers

31 December 2018

Weighted average

loss ratio

Gross carrying

amount Loss allowance

Credit

impaired

₦'000 ₦'000Current (not past due) 0.34% 17,213,368 58,050 No

1 - 30 days past due 1.93% 3,375,898 65,102 No

31 - 60 days past due 3.77% 1,628,806 61,469 No

61 - 90 days past due 7.02% 399,064 28,021 No

91 - 120 days past due 21.30% 623,042 132,726 No

121 - 150 days past due 34.02% 325,113 110,600 No

151 - 180 days past due 81.16% 113,466 92,086 No

More than 180 days past due 100.00% 202,724 202,724 Yes

23,881,481 * 750,778

This comprises amount due from PPPRA with respect to subsidies/PSF receivables on imported products as well as amounts

receivable from PEF with respect to bridging claims. Bridging claims receivables are usually netted off against the payables

following recinciliations with PEF.

The maximum exposure to credit risk for trade and other receivables at the reporting date by type of counterparty was:

The Company uses an allowance matrix to measure the ECLs of trade receivables from individual customers, which

comprise a very large number of small balances. Loss rates are calculated using a single default rate approach. The single

default or loss rate approach is the amount that is expected to be written-off in each bucket (balances that are 180 days past

due in line with the Company's provisioning matrix) and divided by the relevant total unpaid balances included in each ageing

bucket.

The following table provides information about the exposure to credit risk and ECLs for trade receivables and contract assets

from customers as at 31 December 2018.

Determination of amounts due are based on existing regulations/ guidelines and impairment is only recognised when changes

occur in the regulations/ guidelines that prohibit or limit recovery of previously recognised amounts.

The Company has transactions with its parent and other related parties who are related to the Company by virtue of being

members of the Total Group. In the directors’ view, all amounts are collectible. Related party receivable balances were assessed for impairment in accordance with IFRS 9.

Other receivables include finance lease receivables, staff debtors and other sundry receivables. The Company reviews the

balances due from this category on a yearly basis taking into consideration functions such as continued

business/employment relationship and ability to offset amounts against transactions due to these parties. Where such does

not exist, the amounts are impaired. Other receivables were assessed for impairment in accordance with IFRS 9.

77

TOTAL NIGERIA PLC


Credit risk (cont'd)

Expected credit loss assessment for employee receivables

31 December 2018

Weighted average

loss ratio

Gross carrying

amount Loss allowance

Credit

impaired

₦'000 ₦'000Current (not past due) 9.61% 1,806,251 173,637 No

1,806,253 * 173,637

*This has been adjusted for security deposits and receivables not impaired during the year.

Movements in the allowance for impairment in respect of trade receivables.

2018 2017

₦'000 ₦'000Balance at 1 January under IAS 39 1,625,561 1,682,124

Adjustment on initial application of IFRS 9 (376,238) -

Balance at 1 January under IFRS 9 1,249,323 1,682,124

Amounts written off (74,199) (9,355)

Reversal of impairment (935,221) (622,057)

Net remeasurement of loss allowance 684,512 574,849

Balance at 31 December 924,415 1,625,561

Loss rates are based on actual credit loss experience over the past six years. These rates are multiplied by scalar factors to

reflect differences between economic conditions during the period over which the historical data has been collected, current

conditions and the Company’s view of economic conditions over the expected lives of the receivables.

A decrease in credit-impaired balances of ₦636.37 million resulted in decreases in impairment allowances in 2018 of ₦324.93 million.

The movement in the allowance for impairment in respect of trade and other receivables during the year was as follows.

Comparative amounts for 2017 represent the allowance account for impairment losses under IAS 39.

Individual impairments

78

TOTAL NIGERIA PLC



27 Classification of financial instruments

(a) Accounting Classifications and fair values


Loans and

receivables

Other financial

liabilities Total

₦'000 ₦'000 ₦'000

Financial assets not measured at fair value

Trade and other receivables (Note 18)1

52,185,520 - 52,185,520

Cash and cash equivalents (Note 23) 6,094,018 - 6,094,018

58,279,538 - 58,279,538

Financial liabilities not measured at fair value

Borrowings (Note 20) - 34,220,544 34,220,544

Trade and other payables (Note 21)2

- 60,916,152 60,916,152

- 95,136,696 95,136,696


Loans and

receivables

Other financial

liabilities Total

₦'000 ₦'000 ₦'000

Financial assets not measured at fair value

Trade and other receivables (Note 18)1

28,270,336 - 28,270,336

Cash and cash equivalents (Note 23) 12,162,802 - 12,162,802

40,433,138 - 40,433,138

Financial liabilities not measured at fair valueBorrowings (Note 20) - 13,135,023 13,135,023

Trade and other payables (Note 21)2

- 63,107,093 63,107,093

- 76,242,116 76,242,116 1Trade and other receivables excludes advance to suppliers

2Trade and other payables excludes statute based deductions

28 Assets pledged as security

As at the year ended 31 December 2018 there were no assets pledged as security (2017: Nil).

The classification of financial assets and liabilities, together with the carrying amounts shown in the statement of financial position, are shown in the

table below. It does not include fair value information for financial assets and financial liabilities not measured at fair value as the carrying amount is a

reasonable approximation of fair value.

Carrying amount

The Directors consider that the fair value of financial assets and liabilities are not significantly different from their carrying values.

Carrying amount

79

TOTAL NIGERIA PLC


29 Events after the reporting date

30 Related party transactions

30.1 Trading transactions

31 December 31 December 31 December 31 December 31 December 31 December

2018 2017 2018 2017 2018 2017

₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000Total Outré Mer - - 33,326,842 45,353,015 221,393 78,702

Total Oil Trading - - - 955,874 - -

Total E&P Nigeria 1,747,705 2,184,732 - - - -

Total Lubricants 427,945 302,402 - - - -

Total Supply 10,294 -

Total Access to Solar - - 246,489 116,701 - -

Total marketing middle east - - 352,970 237,022 - -

Total SA - - - - 2,518 1,553

Total Congo 293,523 - - - - -

Total Cameroon 409,894 - - - 9,585 -

Total Niger 19,003 - - - - -

Total Gabon 20,672 - - - - -

Total Gestion International - - - - 43,931 79,286

Total Raffinage Marketing - - - - 1,120,297 - 2,918,742 2,487,134 33,936,595 46,662,612 1,397,724 159,541

30.2 Outstanding balance

The following amounts were outstanding at the reporting date:

31 December 31 December 31 December 31 December

2018 2017 2018 2017

₦'000 ₦'000 ₦'000 ₦'000 Total Outre Mer - - 6,547,938 23,695,736

Total Supply - - - 10,294

Total E&P Nigeria 425,218 307,441 - -

Total SA - - 1,553 1,553

Total Cameroon 140,620 - 9,585 -

Total Niger 19,004 - - -

Total Gabon 20,672 - - -

Total Gestion International - - 7,143 -

Total Oil Trading - - 38,375 9,560

Total Marketing middle east - - 104,187 -

Total Raffinage Marketing - - 276,330 135,732

Total Lubrifiants 63,540 60,389 - -

669,054 367,830 6,985,111 23,852,875

Total Treasury 1 3,405,102 4,930,179 - -

4,074,156 5,298,009 6,985,111 23,852,875

Technical assistance and management fees

Total Raffinage Marketing charges Total Nigeria Plc for General Assistance recorded and Total Outre Mer charges Total Nigeria Plc for Research &

Development costs. The expenses are generally charged to profit or loss when the Company obtains approval from National Office for Technology

Acquisition and Promotion (NOTAP) with respect to these transactions. During the year, no accrual was made in this regard.

1Included in the analysis above is the balance of funds held with Total Treasury as at the year ended 31 December 2018; amounting to ₦ 3.41 billion

(2017: ₦4.93 billion). This has however been classified along with cash and cash equivalents in the statement of financial position. See Note 23.

Amounts owed by

related parties

Amounts owed to

related parties

There were no events after the reporting date that could have a material effect on the financial position of the Company at 31 December 2018 and on

the profit for the year ended on that date that have not been taken into account in these financial statements.

As at the year ended 31 December 2018, the Parent Company Total Raffinage Marketing (incorporated in France) owned 61.72% of the issued

shares of Total Nigeria Plc. The Ultimate Parent Company and ultimate controlling party is Total S.A (incorporated in France).

Related Party Transactions above 5% of total tangible assets

In line with Nigerian Stock Exchange - Rules Governing Transactions with Related Parties or Interested Persons, the Company has disclosed

transactions with related parties which are individually or in aggregate greater than 5% of the total tangible assets. The total tangible assets

amounted to ₦33.86 billion and the 5% disclosure limit is ₦1.69 billion. During the year, the Company had entered into transactions above the 5%

disclosure limit with Total Outre Mer and Total E&P Nigeria. Refer to Note 30.1 for details of these transactions.

During the year, the Company entered into the following transactions with related parties, who are members of the Total Group, as shown below:

Sale of goods Purchase of goods Others

80

TOTAL NIGERIA PLC


30.3 Related party transactions (continued)

Emoluments of the Directors of the Company were:

2018 2017₦'000 ₦'000

Transactions with key management 210,061 235,927

Directors remuneration (Note 10) 248,508 259,104

248,508 259,104

Fees for service as directors 46,397 27,866

Other remunerations 202,111 231,238

Chairman's remuneration - - 248,508 259,104

2018 2017

Number Number

₦6,000,001 and above 6 6 6 6

Number of Directors who had no emoluments during the year 3 3

Dividends totalling ₦27,712,120.34 were paid in the year in respect of ordinary shares held by the Company’s directors. (2017:

₦19,798,368.17)

The table below shows the number of Directors whose emoluments during the year excluding pension contributions were within the ranges

stated:

Emoluments of the highest paid director was ₦115,348,140.00(2017 ₦125,874,000.00). The chairman of the board did not earn any

emoluments during the year (2017:Nil).

81

TOTAL NIGERIA PLC


31 Information regarding employees

(i)


2018 2017

Number Number

Below ₦1,500,000 4 1

₦1,500,001 - ₦2,500,000 3 1

₦2,500,001 - ₦3,500,000 3 2

₦3,500,001 - ₦4,500,000 3 18

₦4,500,001 - ₦5,500,000 11 26

₦5,500,001 - ₦6,500,000 10 108

₦6,500,001 - ₦7,500,000 11 112

₦7,500,001 - ₦8,500,000 21 79

₦8,500,001 - ₦9,500,000 104 43

₦9,500,001 and above 291 79

461 469

(ii)


2018 2017

Number Number

Managerial staff 123 122

Senior staff 315 326

Junior staff 23 21

461 469

(iii) The related staff cost amounted to ₦8.82 billion (2017: ₦8.24 billion).

Staff costs relating to the above were: 31 December 31 December

2018 2017

₦'000 ₦'000

Salaries and wages 6,296,861 5,850,626

Termination benefits 165,839 7,520

Pension and social benefit 521,043 472,924

Medical expenses 384,373 318,152

Training expenses 126,471 169,800

Provision for long service award 88,101 219,857

Other Staff Expenses 154,891 180,079

Temporary Staff 1,078,231 1,021,717

Total staff cost 8,815,810 8,240,675

The table below shows the number of staff of the Company whose emoluments during the year excluding pension contributions were within

the ranges stated:

The average number of persons employed in the financial year and the staff costs were as follows:

82

Other national disclosures

FOR THE YEAR ENDED 31 DECEMBER

2018 2017

N'000 % N'000 %

307,987,896 288,062,650

- Imported (33,936,595) (46,662,612)

- Local (246,420,411) (217,920,236)

27,630,890 23,479,802

1,451,424 3,936,146

6,747,584 2,589,877

35,829,898 100 30,005,825 100

4,137,570 12 3,775,985 13

8,815,810 25 8,240,675 27

4,460,937 12 3,063,808 10

Interim dividend 1,018,566 3 1,018,566 3

To maintain and replace:

- Property, plant and equipment 4,651,326 13 3,460,906 12

- Intangible assets 31,490 - 49,934 -

Final dividend 4,753,306 13 2,376,653 8

To augment retained earnings 7,960,893 22 8,019,298 27

35,829,898 100 30,005,825 100

To pay employees:

Salaries, wages, pensions and social benefits

To pay providers of finance:

Finance costs

To pay government:

Income tax, education tax and capital gains tax

Retained in the business

OTHER NATIONAL DISCLOSURES

STATEMENT OF VALUE ADDED

Revenue

Other Income

Finance Income

Less: Bought in materials and services :

Value added

Applied as follows:

84

OTHER NATIONAL DISCLOSURES

FINANCIAL SUMMARY

2014

2018 2017 2016 2015 Restated*

₦'000 ₦'000 ₦'000 ₦'000 ₦'000ASSETS

Property, plant and equipment 33,855,656 28,519,814 25,228,049 23,091,142 21,921,619

Intangible assets 25,943 50,572 73,970 132,610 171,907

Deferred tax assets - - 156,580 - -

Prepayments - Non- current portion 7,201,941 4,291,217 3,261,797 3,743,473 2,198,706

Trade and other receivables 1,524,840 2,875,395 1,437,066 559,960 886,610

Current assets 89,912,403 72,244,875 106,770,698 56,126,370 70,333,586

132,520,783 107,981,873 136,928,160 83,653,555 95,512,428

EQUITY AND LIABILITIES

Current liabilities 95,984,054 76,938,908 113,112,861 63,949,939 76,603,595

Non -current liabilities 5,805,841 2,817,414 245,202 3,461,135 2,978,663

Share capital 169,761 169,761 169,761 169,761 169,761

Retained earnings 30,561,127 28,055,790 23,400,336 16,072,720 15,760,409

132,520,783 107,981,873 136,928,160 83,653,555 95,512,428

REVENUE AND PROFITS

Revenue 307,987,896 288,062,650 290,952,520 208,027,688 240,618,693

Profit before taxation 12,098,463 11,795,283 20,353,076 6,495,390 6,832,922

Profit for the year 7,960,893 8,019,298 14,797,095 4,047,051 5,290,458

Dividends 5,771,872 5,771,872 5,771,870 4,753,305 3,734,740

Basic earnings per share:

Per 50 kobo share (basic) (Naira) 23.45 23.62 43.58 11.92 15.58

Dividend per share:

Per 50 kobo share (actual) (Naira) 17 17 17 14 11

Net assets:

Per 50 kobo share (actual) (Naira) 90.51 83.13 69.42 47.84 46.92

NOTE:

0

Interim dividend of ₦3.00 per share was paid during the period. At the board of directors meeting of 28 March 2018, a final dividend of ₦14.00 was

proposed for the period ended 31 December 2018 (2017 :₦7.00)

Dividend per share is based on the interim dividend declared and paid within the year and the final dividend proposed for that year which is subject

to approval at the Annual General Meeting divided by the number of ordinary shares in issue at the end of the year.

Net assets per share are based on the net assets of the Company and number of ordinary shares of 50k in issue at the end of each financial year.

The financial information presented above reflects historical summaries based on International Financial Reporting Standards.

Earnings per share is based on profit after tax and the number of ordinary shares of 50k in issue at the end of each financial year.

85

86

SHARE CAPITAL HISTORY

The authorized share capital has been increased as follows:

S/N DATE RESOLUTION

1. 10th of April, 1958 18th of August, 1959 25th of May, 1960 30th of November, 1976 21st of June, 1978

₦1,500,000 ₦2,000,000 ₦3,000,000 ₦5,000,000 ₦10,000,000

2. 21st of June, 1978 Each share of₦20 was sub- divided into 40 shares of 50 kobo each.

3. 10th of October, 1978 Authorized capital of the Company was ₦10,000,000 divided into 20,000,000 shares of 50 kobo each.

4. 8th of August, 1980

By a special resolution of the Annual General Meeting of the Company, the authorized share capital of the Company was increased to ₦15,000,000 divided into 30,000,000 ordinary shares of 50 kobo each.

5. 18th of October, 1982

By a special resolution of the Extra -ordinary General Meeting of the Company, the authorized share capital of the Company was increased to ₦22,500,000 divided into 45,000,000 ordinary shares of 50 kobo each.

6. 27th of June, 1984

By a special resolution of the Annual General Meeting of the Company, the authorized Share capital of the Company was increased to ₦33,750,000 divided into 67,500,000 ordinary shares of 50 kobo each.

7. 23rd of June, 1988


8. 11th of July, 1991


9. 8th of June 1994

By a special resolution of the Annual General Meeting of the Company, the authorized share capital of the Company was increased to ₦72,000,000 divided into 144,000,000 ordinary shares of 50 kobo each.

10. 7th of June, 1995

By a special resolution of the Annual General Meeting of the Company, the authorized share capital of the Company was increased to ₦96,000,000 divided into 192,000,000 Ordinary shares of 50 kobo each.

11. 11th of June, 1997

By a special resolution of the Annual General Meeting of the Company, the authorized share capital of the Company was increased to ₦112,000.000 divided into 224,000,000 ordinary shares of 50 kobo each.

12. 28th of August, 2001

By a special resolution of the Annual General Meeting of the Company, the authorized share capital of the Company was increased to ₦148,540,804 divided into 297, 081,608 ordinary shares of 50 kobo each.

13. 17th of June 2004

By a special resolution of the Annual General Meeting of the Company, the authorized and issued share capital of the Company was increased to ₦169,760,918.00 divided into 339,521,836 ordinary shares of 50 kobo each.

87

LIST OF DEALERS AND STATIONS

NO STATE NAME OF DEALER NAME OF STATION

1 ABIA P. C. OGBU ABA GRA

2 ABIA ONYEABO MADUKWE ABA/ OWERRI ROAD

3 ABIA ONWUBIKO ONYEKWERE ABA CENTER

4 ABUJA ABUBAKAR SHAHADA ASOKORO

5 ABUJA FRANCES SULE TOTAL HOUSE

6 ABUJA HENRY ASEMOTA WUSE 2 SS

7 ABUJA LARRY DANIELS KUBWA

8 ABUJA OTETA AUGUSTINE TIPPER GARRAGE

9 ADAMAWA MOHAMMED ADAMU AIRPORT ROAD YOLA

10 AKWA IBOM AKAN OKON ABA ROAD, IKOT EKPENE

11 AKWA IBOM UDUAK UMOH UYO TOWN

12 ANAMBRA JOSEPH IKE OGUTA ROAD

13 ANAMBRA OGWUDU STEPHEN ENUGU ROAD

14 ANAMBRA OKEREKE CHIDIKE NKPOR JUNCTION

15 ANAMBRA ONUORA EJIKE AWKA TOWN

16 BAUCHI MOHAMMED ABUBAKAR BAUCHI ROAD GOMBE

17 BAUCHI SEIDU IBRAHIM YANDOKA BAUCHI

18 BENUE BLESSED OJOCHENEMI KASHIM IBRAHIM

19 BENUE SANI ZUBAIRU JERICHO ROAD

20 BORNO BASHIR ABISO AIRPORT ROAD MAIDUGURI

21 CROSS RIVER COMFORT ETIM CALABAR ROAD

22 CROSS RIVER ADIKURU CHUKWUKA MARIAN ROAD

23 DELTA MIKE ODANLUMEN UMUEZEI

24 DELTA SUSAN ASUQUO ASABA FERRY

25 DELTA SUNNY NWOGO EFFURUN

26 DELTA UZOR UZOR OKUMAGBA ESTATE

27 DELTA EFE OGUNAME OKUMAGBA AVENUE

28 EDO FATAI SALAUDEEN AUCHI

29 EDO SIKIRU ALABI EREKESAN MARKET

30 EDO ANDREW EKEAMANYE 1ST EAST CIRCULAR

31 EDO JOHN OYERE UGBOWO

32 EDO GRANT AKHAJEME IKPOBA SLOPE

33 EKITI OLABANJI ABRAHAM ADO IWOROKO ROAD

34 EKITI MICHEAL OLOBELE ADO IKERE ROAD

35 ENUGU NNOROM VIVIAN PRESIDENTIAL ROAD

36 ENUGU MALACHY MADU UWANI

37 ENUGU VICTOR OKAFOR AGBANI ROAD

38 GOMBE KOLA ESHO ALKALAM

88

39 IMO EDUEMEH SAMUEL DOUGLAS ROAD, OWERRI

40 IMO ANYANWU DOMINIC ARUGO PARK, OWERRI

41 IMO ANTHONY AMADI EGBU ROAD, OWERRI

42 KADUNA MOHAMMED ABUBAKAR KADUNA ZARIA ROAD

43 KADUNA KABIR UMAR WAFF ROAD KADUNA

44 KADUNA ABUBAKAR HASSAN SOUTH BRIDGE KADUNA

45 KADUNA VICTOR MAJEKODUNMI BARNAWA KADUNA

46 KADUNA GARBA MAMMAN MAIN STREET

47 KADUNA OLUSEGUN OMOTAYO HOSPITAL ROAD

48 KANO SAMSON AJIBOLA AIRPORT ROAD

49 KANO AUWALU G. KOKI KANO COOPERATIVE

50 KANO SHEHU SANI ZOO ROAD

51 KANO BASHIR MAGAJI CLUB ROAD

52 KOGI OKO SUNNY OBIYAN OKENE

53 LAGOS DELE RABIU ONIGBAGBO

54 LAGOS OLAJIDE CLEMENT DIYA

55 LAGOS JIDE ALESE AWOLOWO ROAD

56 LAGOS OLOFIN SAMUEL SURULERE

57 LAGOS ADEGOKE SULEIMAN OSHODI

59 LAGOS TINA OKORIE SURA

60 LAGOS KEMI NWIDOBIE WESTERN AVENUE

61 LAGOS AWOLEKE AWOFESO OJOTA 2

62 LAGOS OYINLOLA OLAGUNSOYE ALAPERE 2

63 LAGOS ANURUO JOSEPHINE IKEJA

64 LAGOS WANDE RASHEED LEKKI 2

65 LAGOS CENTER MOZIA LEKKI 1

66 LAGOS TUNDE MAKUN IGBOBI

67 LAGOS SOLOMON AIDELODJIE OLD TOLL GATE

68 LAGOS ADEBAYO ADEDAYO ITIRE

69 LAGOS OLANIYAN SAMUEL OJOTA 1

70 LAGOS ALEEM MARUF AKOKA

71 LAGOS SALAMI AKINROLE IJORA

72 LAGOS HASSAN RAUF AJEGUNLE

73 LAGOS BASHIRU ONI CHALLENGE

74 LAGOS MAHMOUD ADUMBU SEME-BADAGRY

75 LAGOS AYO AJAYI ALAUSA

76 LAGOS AIGBIGIE BERNARD OLD OJO ROAD

77 LAGOS TUNDE OLANIPEKUN COATES

78 LAGOS AGBO CECILIA HERBERT MACUALAY

79 LAGOS SEMIU O. RASAKI TINCAN

80 LAGOS STEPHEN HART MILE 2

81 LAGOS RASAKI ADESANYA AJANGBADI

89

82 LAGOS MOHAMMAD AROTAYO IKORODU RD

83 LAGOS MUYIWA EDUN MM WAY

84 LAGOS KEHINDE AMOO CAMPBELL

85 LAGOS ABIODUN ADEYEMI MUSHIN

86 LAGOS TUNDE ADEKOLA WHARF ROAD

87 LAGOS AKHIGBE SUNDAY OJUELEGBA

88 LAGOS OLANIYI BURAIMOH BONNY ROAD

89 LAGOS ADEJUMO SUNDAY IKORODU TOWN

90 LAGOS ADEBAYO FATAI BENSON BUS STOP

91 LAGOS TITILAYO JEGEDE AGEGE S/S

92 LAGOS TOBI KUSHIMO ALAKUKO S/S

93 LAGOS JAPHET EFIFIA IYANA MEIRAN S/S

94 NIGER HARUNA BABA BOSSO ROAD

95 NIGER OLA OLADELE TUDUN FULANI

96 OGUN OPARA PHILIP IBADAN ROAD S/S

97 OGUN ABIDEEN AMINU ABEOKUTA ROAD S/S

98 OGUN MUDA KAREEM EWEKORO S/S

99 OGUN SALAMI KEMI OKEITOKU S/S

100 OGUN ADELEYE OLUTOLA IKEREKU S/S

101 OGUN SHOTAYO SEGUN SAGAMU CENTRE S/S

102 OGUN OWONIFARI OKPEYEMI OGIJO S/S

103 ONDO FEMI BABATUNDE ONDO MOTOR PARK

104 ONDO TAJUDEEN OLANREWAJU ILESHA ROAD

105 OYO ELDER E.A. DEGUN ELEYELE 1

106 OYO FATIMAH AKINDOYIN NEW RESERVATION

107 OYO OLAWOYIN MOSES ASHI

108 OYO OGUNMODEDE OYENEYE MOKOLA

109 OYO PRINCE ADEKUNLE SIJUWADE QUEEN ELIZABETH

110 OYO FEMI AKINPELU OFFA TOWN

111 OYO RUKAYAT AZEEZ FATE ROAD

112 OYO RUFUS ADEYEMI AKURE ROAD

113 OYO ADEYANJU GBENGA IBADAN ROAD IFE

114 OYO KAZEEM SAKA OYO ROAD OGBOMOSO

115 PLATEAU LIMMY BAWA JOS MOTOR PARK

116 PLATEAU JANET ERU YAKUBU GOWON WAY JOS

117 PLATEAU IYKE OFEGBU BUKURU BYE PASS JOS

118 RIVERS SUNDAY ANDREW RUMUOBIAKANI, PH

119 RIVERS MARTINS NWOKO MILE 2, PH

120 RIVERS EREKOSIMA JOHN PORT HARCOURT GRA

121 RIVERS S N OBIDIKE PORT HARCOURT 1

122 RIVERS ANTHONY BIRAGBARA PORT HARCOURT 2

123 RIVERS NNADI UCHE RUMUOMASI, PH

90

124 RIVERS ODIWE PATRICIA OROGBOM

125 RIVERS OKE OKECHUKWU LIBERATION DRIVE

126 SOKOTO IBRAHIM GOBIR AHMADU BELLO WAY

127 SOKOTO ALMU MARNAWA ILLELA ROAD 2

128 TARABA SUNDAY AUDU JALINGO

129 YOBE ABDULLAHI AHMED MAIDUGURI ROAD S/S

total nigeria plc...total nigeria plc was incorporated in 1956 and was listed on the nigerian stoc k...

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