Aradel Holdings Plc grew its profit after tax (PAT) from N7.1 billion to N19.2 billion in nine months ending September 30, 2023.
The profit, which is among the strongest performance posted by Nigerian quoted companies, translates to 170.1 per cent growth year-on-year (y/y).
Its profit before tax (PBT) also went up by 117.4 per cent to N37.4 billion, an expansion of over N20 billion showing the company’s resilience.
The surge in its profitability saw the company’s income tax expense surging to N18.2 billion – N6.6 billion cash tax and N11.6 billion deferred tax.
According to its filings at the exchange, the company’s gross profit stood at N70.3 billion as opposed to N22.4 billion posted in the comparative period. Its operating profit stood at N40.2 billion. But rising cost of the operation took a chunk of the earnings with general and administrative (G&A) expenses increasing by 342.6 per cent y/y to N30.5 billion.
Key drivers of the growth of the expenses, the company said, included exchange loss (58.2 per cent of G&A expenses), which rose from zero position in 2022 to N17.7 billion.
Finance cost also increased by 226 per cent to N10.2 billion, the company reported. This was driven by an N1.3 coupon payment on bonds and an increase in interest expense by N3.9 billion due to additional borrowings as well as an N1.9 billion increase in provisions for the unwinding of discounts.
But the hair share due to loss to finance cost was partly offset by finance N400 billion to increase by 788.4 per cent resulting from increased money market activity – from N400 million to N3.6 billion.
The company also had a robust top-line outing in the period with its total assets, driven by property/equipment acquisition as well as investment in associated interests, growing by 70.1 per cent to N805.1 billion.
Total equity also increased by 77.5 per cent to N579.9 billion. The growth, according to the unaudited statement, was due to the retention of total comprehensive income in the period.
To fund ongoing Ogbele field development, the company saw it making a drawdown of $10 million from its existing $120 million field development facility (FDF) obtained in March 2022.
It also revealed that it secured a bond of N10 billion last 2022 as part of a N20 billion bond series with the proceeds to be used in funding critical naira-denominated projects.
The reporting period also marked critical milestones for the company, which has produced consistently for 18 years. It commenced production in Well-12 and Well-13, recording a crude output of 8,893 barrels per day, 148.1 per cent up from 3,584 recorded in 2022.
Commenting on the result, the Chief Executive Officer, Adegbite Falade, said: “The first nine months of 2023 have been a period of significant progress and growth for our company, despite the challenging macroeconomic environment. We commenced production in two new wells during the period, which has significantly boosted our crude oil and gas production. This, coupled with an increase in refined product output, has led to a year-on-year increase in our overall production volumes.
“Our revenue for the period increased by 238.8 per cent, reflecting the higher production, the combined utilisation of the Trans Niger Pipeline and the alternative crude evacuation channel, as well as improved revenues from the Refinery. This remarkable revenue growth is a testament to the effectiveness of our strategic initiatives allied with the company’s focus on execution.”
