Solid production growth, strategic acquisitions, and resilient operations drive 40% profit jump
Strong Operational Momentum in a Volatile Environment
Aradel Holdings Plc, one of Nigeria’s foremost indigenous integrated energy companies, has reported a robust set of unaudited results for the half year ended 30 June 2025. The Company recorded notable operational growth across crude oil, gas, and refined product segments despite macroeconomic challenges and evolving global energy dynamics.
Financial Performance Summary for the Half-Year Ended 30 June 2025
For the half-year ended 30 June 2025, the company reported a strong revenue growth of ₦368.1 billion, marking a significant increase from ₦268.3 billion recorded in the same period of 2024 — a year-on-year growth of ₦99.8 billion or 37.2 billion in variance.
Despite the rise in revenue, operating profit declined to ₦118.6 billion from ₦150.3 billion in the prior year, reflecting a drop of ₦21.7 billion. Consequently, the operating profit margin shrank from 56.0% to 32.2%, a compression of 2,378 basis points, indicating a higher cost structure or increased operating expenses.
EBITDA also saw a decline, falling from ₦189.7 billion to ₦176.4 billion, a drop of ₦13.3 billion, while the EBITDA margin narrowed to 47.9% from 70.7%, representing a decline of 2,280 basis points.
Nonetheless, profit before tax increased significantly to ₦191.3 billion, up from ₦162.3 billion in 2024, representing a gain of ₦29 billion. This was largely aided by a substantial jump in the share of profit from associates, which surged from ₦13.5 billion to ₦71.3 billion, an increase of ₦57.8 billion.
Profit after tax followed this upward trajectory, rising to ₦146.4 billion compared to ₦104.4 billion in the previous year, an improvement of ₦42 billion. This translated into a notable rise in earnings per share, which grew from ₦24.0 to ₦33.3, up by ₦9.3 or approximately 38.8%.
On the cash flow front, operating cash flow came in at ₦140.8 billion, slightly below the prior year’s ₦165.4 billion, a decline of ₦24.6 billion. Capital expenditure was marginally lower at ₦48.1 billion, compared to ₦49.2 billion in 2024.
The company's total assets grew modestly from ₦1.75 trillion to ₦1.81 trillion, a rise of ₦60.9 billion, while total equity strengthened to ₦1.45 trillion, up from ₦1.40 trillion, reflecting a healthy balance sheet position.
Group Financial Highlights
| 30 June 2025 | 30 June 2024 | Variance |
| ₦’billion | ₦’billion | % |
Revenue | 368.1 | 268.3 | 37.2 |
Operating Profit | 118.6 | 150.3 | (21.1) |
Operating Profit Margin | 32.2% | 56.0% | (2378bps) |
EBITDA | 176.4 | 189.7 | (7.0) |
EBITDA Margin | 47.9% | 70.7% | (2280bps) |
Profit Before Tax | 191.3 | 162.3 | 17.9 |
Share of profit of associates | 71.3 | 13.5 | 429.8 |
Profit After Tax | 146.4 | 104.4 | 40.2 |
Earnings per Share | 33.3 | 24.0 | 38.8 |
Operating Cashflow | 140.8 | 165.4 | (14.9) |
Capital Expenditure | 48.1 | 49.2 | (2.2) |
Total Assets | 1,810.7 | 1,749.8 | 3.5 |
Total Equity | 1,453.2 | 1,404.1 | 3.5 |
In a statement accompanying the results, Chief Executive Officer Mr. Adegbite Falade acknowledged the demanding operating landscape marked by price volatility and infrastructural bottlenecks but commended the Company’s resilience and focus on its long-term strategy.
“The first half of the year was shaped by significant geopolitical and domestic pressures,” Falade said. “Yet, we delivered solid performance and advanced our strategic agenda with key investments and strong production stability.”
Operational Highlights: Output Growth Across All Segments
Aradel posted a 19.7% year-on-year increase in crude oil production to 15,508 barrels per day (H1 2024: 12,957 bpd). Gas production also edged up by 1.5% to 41.2 million standard cubic feet per day (mmscfd), equivalent to 7,276 barrels of oil equivalent per day.
Sales of refined petroleum products surged 32.7% to 165.3 million litres, up from 122.2 million litres in the same period of 2024, reflecting stronger local demand and improved downstream distribution capacity.
The Company’s average realised crude oil export price declined to $73.6 per barrel (H1 2024: $87.5), in line with global market trends. However, realised gas prices rose to $1.7 per mscf (H1 2024: $1.5), partially offsetting the oil price weakness.
Strategic Growth and Portfolio Diversification
The first half of 2025 was marked by significant strategic moves aimed at broadening Aradel’s investment footprint and enhancing non-operated asset returns.
The acquisition of a 6.01% equity stake in Chappal Energies Mauritius Limited, and an additional investment in Renaissance Africa Energy Company—which recently completed the acquisition of Shell Petroleum Development Company of Nigeria (SPDC)—were both milestones in the Group’s diversification strategy.
Aradel now indirectly holds a 33.3% equity interest in Renaissance, combining its 12.5% direct holding with ND Western Limited’s 50% equity stake, where Aradel has a 41.6% interest.
These investments are already yielding financial dividends. The Company recognised a ₦71.2 billion share of profit from its associates, underscoring the earnings power of its strategic partnerships.
Financial Performance: Revenue and Profit Surge Despite Rising Costs
Despite a lower average oil price, Aradel’s revenue rose by 37.2% to ₦368.1 billion (H1 2024: ₦268.3 billion), driven by higher sales volumes across crude, refined products, and gas.
- Crude oil revenue (63.2% of total) climbed 36% to ₦232.8 billion, supported by improved production and utilisation of the Trans Niger Pipeline and Alternative Crude Evacuation (ACE) systems.
- Refined products revenue rose 42.6% to ₦116.5 billion (31.6% of total), reflecting growing downstream volumes.
- Gas revenue increased by 21.7% to ₦18.8 billion (5.2% of total), due to both production growth and improved pricing.
However, rising input costs took a toll on margins. Cost of sales (COS) surged 91.8% to ₦204.9 billion, driven by higher royalties, depreciation, crude handling charges, and operational expenses linked to new well developments and community obligations under the Petroleum Industry Act (PIA).
General and administrative expenses more than doubled, rising by 184.1% to ₦53.1 billion, mainly due to increased staff compensation and the rollout of a new share-based incentive scheme.
Despite these pressures, profit after tax climbed 40.2% to ₦146.4 billion, while profit before tax stood at ₦191.3 billion, up 17.9% from the same period in 2024.
Balance Sheet: Asset Expansion and Dividend Payouts
Total assets grew by 3.5% year-to-date to ₦1.8 trillion, underpinned by the Chappal and Renaissance investments. Liabilities also edged up by 3.4% to ₦357.5 billion, reflecting additional borrowings tied to the SPDC acquisition and H1 tax obligations.
Total equity stood at ₦1.45 trillion, up from ₦1.40 trillion at FY 2024, driven by retained earnings.
In a show of confidence, the Company paid out a final dividend of ₦22 per share for FY 2024 during the review period.
Cash Flows: Healthy Operating Cash Despite Investment Outflows
Aradel generated ₦179.7 billion in operating cash flow, a 6% increase from the prior year, despite settling ₦38.9 billion in income tax and pending gas sales receipts of ₦38.2 billion expected in Q3 2025.
Net cash used in investing activities more than doubled to ₦97.1 billion, mainly due to the Renaissance and Chappal deals. Financing outflows rose to ₦112.2 billion, reflecting dividend payments and debt service.
Board Refresh and Governance Enhancements
As part of ongoing governance reforms, Aradel welcomed several new directors in H1 2025:
- Mr. Osten Olorunsola was appointed Chairman of the Board, succeeding Mr. Ladi Jadesimi.
- New board members include Ms. Kerin Gunter, Mr. Olusola Adeeyo, Mr. George Osahon, and Mr. Mahmud Tukur—bringing with them a wealth of experience across energy, finance, and governance.
“These board changes reinforce our commitment to strong oversight and a future-ready leadership team,” said Mr. Falade.
Outlook: Staying Focused in a Shifting Energy Landscape
Looking ahead, Aradel aims to stay the course on its strategic priorities—optimising operations, deepening its asset base, enhancing shareholder value, and delivering responsibly in Nigeria’s evolving energy market.
With a strengthened portfolio, growing influence in upstream ventures, and stable production capacity, the Company remains well-positioned for sustained value creation in the second half of 2025.