Conoil Plc, one of Nigeria’s oldest petroleum marketing companies, has reported a significant drop in its profit after tax for the half-year period ended June 30, 2025. According to the company’s unaudited financial statement filed with the Nigerian Exchange Limited (NGX), Conoil’s profit fell by a sharp 89 per cent year-on-year to N900.4 million, compared to N8.02 billion recorded in the same period in 2024.
The drop in profit was largely attributed to falling revenue and rising expenses, especially distribution and finance costs. In the six-month period under review, Conoil posted a total revenue of N143.65 billion, which represents a 20.4 per cent decline when compared to N180.57 billion recorded in the corresponding period of 2024.
Even though the company recorded lower revenue, its cost of sales also reduced slightly. Conoil’s cost of sales stood at N132.28 billion, which is an 18.9 per cent drop from N163.05 billion in the previous year. However, the decline in cost of sales could not cushion the overall impact on earnings, as the gross profit also reduced significantly. For the period under review, Conoil recorded a gross profit of N11.36 billion, which is 35.2 per cent less than the N17.53 billion recorded in the first half of 2024.
The company also continued to battle with operating costs. Its distribution expenses went up from N1.88 billion to N2.24 billion, while administrative expenses moved slightly from N3.20 billion to N3.21 billion. These rising costs further put pressure on the company’s profitability.
Finance costs, in particular, had a major impact. The company’s finance expenses more than doubled to N4.76 billion from N2.22 billion. This suggests that Conoil may be dealing with higher borrowing costs or has taken on more debt during the period.
As a result of all these pressures, profit before tax for the first half of 2025 dropped steeply by 88.8 per cent to N1.15 billion, from N10.22 billion recorded in the same period last year. The tax expense also fell in line with the reduced earnings, from N2.20 billion to N246.6 million, bringing the profit after tax to N900.4 million.
The drop in profit also affected Conoil’s earnings per share, which fell to 130 kobo from 1,156 kobo in the previous year. The company did not declare any dividend for the period under review.
Despite the pressure on earnings, Conoil’s balance sheet remained relatively steady. The company’s total assets as of June 30, 2025, stood at N117.56 billion, compared to N114.95 billion as of December 2024. This slight increase shows that the company was still able to maintain some level of asset growth. The company’s current assets stood at N111.7 billion, which was supported largely by trade and other receivables of N89 billion, and cash and bank balances amounting to N7.85 billion.
On the equity side, shareholders’ funds dropped marginally by 1.9 per cent to N40.39 billion, from N41.17 billion in the same period of 2024. Retained earnings also reduced by 2.1 per cent to N36.2 billion, which reflects the drop in the company’s profit level.
Conoil Plc, led by its Chairman Dr. Mike Adenuga, remains one of the major players in the Nigerian downstream oil sector. The company is involved in the marketing of refined petroleum products such as petrol, diesel, kerosene, aviation fuel and lubricants. It operates across Nigeria with a network of retail stations and industrial clients.
Analysts say the latest result reflects the broader challenges facing the downstream oil and gas sector in Nigeria. The industry is still grappling with issues like high operating costs, currency depreciation, rising inflation, and tight liquidity in the banking system. In addition, the deregulation of fuel pricing and the rising cost of financing are expected to continue affecting the bottom line of many oil marketing firms.
As Conoil prepares for the second half of the year, stakeholders and investors will be watching closely to see if the company can bounce back from this earnings decline and improve its financial performance.
