Conoil Plc’s profit has fallen to its weakest level in at least five years, dragged down by surging finance costs and softer fuel sales that continue to squeeze margins across Nigeria’s downstream oil market.
The petroleum marketer posted an 87.9 percent decline in after-tax profit to N1.46 billion for the first nine months of 2025, compared with N12.1 billion a year earlier, according to its unaudited financial statement for the period ended September 30.
Revenue fell 18.2 percent to N203.8 billion, reflecting weaker throughput across major product lines as demand remained subdued, following the commencement of oil refining by Dangote Refinery.
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The hit to profitability was compounded by a sharp rise in finance expenses. Interest costs jumped 178 percent to N6.9 billion, driven by increased reliance on short-term bank borrowings amid elevated monetary tightening and liquidity constraints across the sector.
Conoil’s total borrowings rose to N39.7 billion, up from N28.7 billion at the end of 2024, while finance charges alone wiped out more than 40 percent of gross profit earned within the period.
Gross profit declined 34.7 percent to N16.7 billion, as cost pressures and volume contraction eroded margins. White products—responsible for 96 percent of the company’s revenue—continued to underperform amid increased competition, pricing volatility, and the lingering effects of the 2024 deregulation disruptions. Lubricants contributed only 4 percent of group sales.
The company is also grappling with working capital stress. Trade receivables surged by more than N17 billion, indicating slower customer payments, while inventories fell from N29.3 billion to N14.1 billion due to a deliberate stock drawdown aimed at preserving cash.
Still, cash flow pressures deepened: Conoil ended the period with a negative cash and cash equivalent position of N30.4 billion, compared with a negative N21.4 billion at the start of the year.
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Shareholders’ funds dipped 9.5 percent year-on-year to N40.96 billion, dragged by lower retained earnings. Earnings per share slumped to 211 kobo, from 1,747 kobo in the same period of 2024, while no dividend was declared as the company opted to conserve liquidity.
Shares of Conoil have plunged by 50.8 percent since January, closing its last trading day on Friday at N190.70 per share on the Nigerian Stock Exchange (NGX). The Mike Adenuga-controlled marketer now ranks 145th on the NGX in terms of year-to-date performance.
With inflation still elevated, interest rates high, and FX volatility weighing on import costs, Conoil faces a difficult operating landscape. Stabilising cash flows, accelerating debt reduction, and tightening credit management may be essential to rebuilding profitability as it heads into 2026.
