Conoil Plc has proposed a dividend of N2.00 per share for the 2025 financial year, amounting to a total payout of N1.387 billion, despite reporting a sharp decline in profitability as rising borrowings and finance costs weighed heavily on earnings. The proposed dividend, subject to shareholder approval at the company’s Annual General Meeting, represents a 42.9% decline from the N3.50 per share paid for the 2024 financial year, according to the company’s audited financial statement filed with the Nigerian Exchange on Friday, June 12.
The audited financial statements for the period ended December 31, 2025 show that profit after tax fell by 77.1% to N2.01 billion, while earnings per share declined to N2.90 from N12.64 recorded in the previous year, suggesting weaker earnings performance during the year under review. A review of the company’s financial performance shows that while Conoil maintained revenue above the N300 billion-mark, profitability came under significant pressure from rising financing costs and margin compression.
The results indicate that the most significant drag on earnings was the sharp increase in borrowing costs, with surging finance costs severely consuming a substantial portion of operating profit generated during the year. Compressing profits and earnings per share of N2.90 forced a lower N2.00 per share dividend payout, representing a total payout of N1.387 billion. The proposed dividend is 42.9% lower than the N3.50 per share distributed for the 2024 financial year. Despite the earnings contraction, the company is proposing to distribute a significant portion of its earnings to shareholders.
The balance sheet reveals that Conoil expanded its asset base during the year but relied heavily on debt financing to support that growth. The figures suggest liabilities grew considerably faster than assets, highlighting increasing leverage across the business. Borrowings alone accounted for more than half of total liabilities, underlining the company’s growing dependence on debt financing. The near doubling of debt levels contributed directly to the 162.46% increase in finance costs, which became the primary factor behind the steep decline in profitability.
The balance sheet therefore points to mounting financing pressures and weaker profitability. Finance costs rose faster than any major income line, increasing by 162.46% during the year. Nairametrics had reported that Conoil’s pretax profit plunged 77% to N2.53 billion in 2025. Meanwhile, in broader economic developments, President Tinubu Honours key stakeholders in the energy sector, while Tinubu Announces 81% reduction in import duties for certain goods. Additionally, the World Bank Unveils a new financing framework for African infrastructure, and the UK Launches £15 million fund for digital innovation. In the technology space, an Ai-led Cybersecurity Fintech startup recently secured Series B funding to expand its operations across the continent.
