Conoil Plc posted a steep drop in profit in 2025 as rising borrowing costs, liquidity pressure, and mounting debt erased gains from a larger asset base.
A review of its unaudited financial statement for the year ended December 31, 2025 revealed that the company’s profit before tax plunged by 77 per cent to ₦2.53 billion from ₦11.00 billion in 2024.
Its net profit declined by 77.1 per cent to ₦2.01 billion, while revenue fell by 6.6 per cent to ₦301.72 billion, down from ₦323.13 billion in 2024, reflecting weaker operating performance during the year.
The oil marketer’s earnings per share also dropped sharply to 290 kobo, compared with 1,264 kobo in 2024.
The earnings slide was largely driven by a surge in finance costs as interest expenses more than doubled to ₦10.38 billion in 2025 from ₦3.95 billion in the previous year, mainly due to heavier reliance on high-interest bank overdrafts.
Despite the weaker profit, Conoil’s total assets grew to ₦139.01 billion from ₦114.95 billion in 2024.
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However, shareholders’ funds slipped slightly by 1.1 per cent to ₦39.07 billion, underscoring the strain on the company’s balance sheet.
Liquidity remained under pressure, with Conoil ending the year in a net negative cash position of ₦41.24 billion.
The company’s management attributed the shortfall to increased investment in inventory and expanded credit sales.
Its borrowings rose sharply, as bank overdrafts jumped to ₦54.24 billion in 2025 from ₦28.68 billion in 2024. The overdrafts attracted an average effective interest rate of about 32 per cent.
As a result, Conoil’s gearing worsened, with net debt-to-equity nearly doubling to 1.39 from 0.73 in 2024, pointing to a heavier dependence on debt to fund operations.
The company also continues to face legal risk from a long-running dispute with Nimex Petrochemical Nigeria Limited.
While Conoil has appealed a ₦4.3 billion judgment, it has made full provision for the amount in its accounts.
A further review of the results showed credit exposure increased with trade and other receivables rising to ₦91.66 billion from ₦71.90 billion, reflecting the company’s push to drive sales through credit.
The company stated that it is closely monitoring the impact of broader economic conditions and the lingering effects of the COVID-19 pandemic on credit risk, asset impairment, and inventory values.
As earlier reported by Pinnacle Daily, Conoil emerged as one of the poorest-performing oil stocks on the Nigerian Exchange Limited in the period under review.
Alex is a business journalist cum data enthusiast with the Pinnacle Daily. He can be reached via ealex@thepinnacleng.com, @ehime_alex on X
