Aradel half-year results showed exceptional revenue growth in the first six months of the year, although rising costs limited the increase in net profit.
Aradel Holdings reported that revenue for January to June surged to ₦2.5 trillion, up from ₦368.1 billion recorded during the same period last year. The strong performance followed the company’s acquisition of a majority stake in ND Western, where it previously held a non-controlling interest, and came during a period of higher global oil prices driven by supply disruptions linked to the US-Israeli war against Iran.
Despite the sharp increase in turnover, profit after tax rose more modestly to ₦191 billion from ₦146.4 billion, as significantly higher operating costs reduced the overall earnings impact. The conflict in the Middle East disrupted crude oil supplies through the Strait of Hormuz, a major global energy route, contributing to higher oil prices that benefited energy producers worldwide.
According to the company’s unaudited financial results released on Friday, 77.8 per cent of total revenue came from crude oil exports. Average daily crude oil production increased by 258 per cent, while average daily gas production climbed by 1,121 per cent. Its refinery at the Ogbele field in Rivers State, with a processing capacity of 11,000 barrels per day, generated ₦129.5 billion from refined product sales, representing an 8.1 per cent increase.
However, other losses widened to ₦213.1 billion, compared with a gain of ₦8.6 billion a year earlier. Finance costs also jumped sharply to ₦326.1 billion from ₦11.1 billion, while tax expenses surged 1,150.4 per cent to ₦561.7 billion. Even so, profit before tax increased 293.4 per cent to ₦752.7 billion, while the EBIT margin improved to 42.4 per cent from 32.2 per cent.
Chief Executive Officer Adegbite Falade said, “A firmer price environment supported performance, generating net cash from operating activities of ₦975.6 billion and a closing cash balance of ₦1,716.6 billion.” He added, “This drove the reduction in net debt to ₦46.5 billion at year’s end, from ₦475.1 billion in the prior year.” The Aradel half-year results reflect strong operational growth despite mounting cost pressures. Overall, the Aradel half-year results underline the company’s resilience in a volatile global energy market.
Do you think rising global oil prices will continue to boost the performance of Nigerian energy companies?
