Aradel reports N321.6b pre-tax profit, sees 162.74% surge in revenue

Aradel Holdings Plc has posted an impressive pre-tax profit of N321.6 billion for the year ended December 31, 2024, marking a 187% year-over-year growth.

The company’s revenue surged by 162.74%, reaching N581.022 billion, up from N221.142 billion in 2023.
The significant rise in revenue was driven by a 244.6% increase in export crude oil revenue, a 174.7% increase in gas revenue, and a 74.9% rise in refined products revenue.

Key Financial Highlights (2024 vs. 2023)
– Revenue: N581.022 billion (+162.74% YoY)
– Cost of Sales: N261.213 billion (+231.45% YoY)
– Gross Profit: N319.809 billion (+124.69% YoY)
– Operating Profit: N297.474 billion (+160.81% YoY)
– Profit After Tax: N247.786 billion (+361.10% YoY)
– Earnings Per Share: N57.03 (+361.03% YoY)
– Cash and Cash Equivalents: N422.206 billion (+116.94% YoY)
– Total Assets: N1.745 trillion (+88.96% YoY)
– Total Equity: N1.393 trillion (+97.67% YoY)

Aradel’s CEO, Mr Adegbite Falade, attributed the strong performance to increased hydrocarbon production and successful re-entry into the Omerelu Field, achieving First Oil in May 2024.

He noted that the company’s ability to maintain strong profitability, including a 361% increase in net profit, was driven by higher production, favourable pricing, and re-estimated Asset Retirement Obligation (ARO) liabilities.

Despite the growth, Aradel faced rising costs, leading to a slight decrease in gross and operating profit margins. The gross profit margin declined from 56.5% in 2023 to 55.0% in 2024 due to increased cost of sales, which grew by 231.45%, outpacing revenue growth.

Aradel’s balance sheet remains strong, with total assets rising by 89% year-over-year and equity nearly doubling. Liabilities grew by 60.9%, primarily due to tax liabilities and foreign exchange adjustments.

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The company’s free cash flow grew by 98%, reaching N178.5 billion, giving it ample financial flexibility for investments, including refinery expansion and acquisitions, without heavy reliance on external borrowing.

In a landmark achievement, Aradel was listed on the Nigerian Stock Exchange (NGX) in October 2024, a significant milestone for the company.
The company declared an N8 per share interim dividend, offering a dividend yield of 1.48%.

Aradel’s stock performance, however, saw a 14.9% decline year-to-date by the end of 2024. The stock has since improved, reducing the year-to-date loss to 9.7% as of January 28, 2025.

Looking ahead to 2025, Aradel plans to initiate development programs for the Olo, Olo West, and Omerelu Fields.