…Up 162.8% and Profit after Tax of ₦259.1 Billion, up 382.1%.
…Declares Final dividend of ₦22 per Share
Aradel Holdings Plc (“Aradel”, “Aradel Holdings”, “the Company” or “the Group”), Nigeria’s leading integrated indigenous energy company, announces its audited results for the year ended 31 December 2024.
Group Financial Highlights 31 December 2024 31 December 2023 Variance ₦’billion ₦’billion % Revenue 581.2 221.1 162.8 Gross Profit 356.5 142.3 150.5 Operating Profit 291.4 114.1 155.5 Operating Profit Margin 50.14% 51.58% (143bps) EBITDA 372.0 129.3 187.6 EBITDA Margin 64.02% 58.49% 553bps Profit Before Tax 316.8 112.2 182.4 Profit After Tax 259.1 53.7 382.1 Earnings per Share 59.35 12.37 388.9 #Operating Cashflow 311.9 139.0 124.4 Capital Expenditure 136.8 48.9 179.9 Free Cashflow 175.1 90.1 94.3 Total Assets 1,749.8 923.4 89.5 Total Equity 1,404.1 704.6 99.3
Operational Highlights •
Production and Refining:
o Crude oil production of 13,751 bbls/day up 41.2% (FY 2023: 9,739 bbls/day)
o Gas production of 32.4 mmscfd (5,717 boepd) up by 21.9% (FY 2023: 26.6 mmscfd (4,691 boepd))
o Refined petroleum products sold 240.5 mmltres up by 14.5% (FY 2023: 210.1 mmltres)
- Average realised crude oil price (exported) per barrel of $82.3 (FY 2023: $80.0)
- Average realised gas price per mscf of $1.7 (FY 2023: $1.7)
The Chief Executive Officer of Aradel Holdings Plc, Mr. Adegbite Falade Comments:
“Aradel Holdings Plc delivered exceptional operational and financial performance in 2024, with revenue rising by 162.8% to ₦581.2 billion. This remarkable growth was primarily driven by increase in export crude oil revenue, which accounted for over 64% of total revenue. The surge was supported by higher production levels, improved utilisation of the Trans Niger Pipeline (TNP), and additional value captured through the Alternative Crude Evacuation (ACE) system.
We completed the acquisition of the Olo and Olo West Marginal Fields from the TotalEnergies/NNPC Joint Venture and secured a 5.14% equity stake in Chappal Energies Mauritius Limited, an energy investment company focused on deep-value and brownfield upstream opportunities across Africa. Additionally, we are pleased to report the successful completion of Renaissance’s acquisition of Shell Petroleum Development Company of Nigeria (SPDC), a landmark transaction that further strengthens our asset base and enhances long-term value creation.”
In line with our growth strategy, we successfully completed our Phase 1, four-well turnkey drilling campaign, delivering positive results. The commencement of Phase 2 drilling with Well 16 signals continued progress in Aradel’s development and production activities. To support this growth, we expanded our throughput capacity for evacuation channels, positioning Aradel to sustain strong production levels and operational efficiency.
Our listing on Nigerian Stock Exchange (NGX) on the 14th of October 2024 further underscored our growth trajectory, improved share liquidity and advances our commitment to delivering long-term value to shareholders.
Financial Review
Foreign exchange dynamics continued to impact on the financial performance of the Group. The average exchange rate in 2024 was ₦1479.68:US$1; it was ₦645.92: US$1 in 2023.
Revenue
Increased by 162.8% to ₦581.2 billion (FY 2023: ₦221.1 billion). This was driven by:
- 244.6% increase in export crude oil revenue (64.31% of total revenue) to ₦373.7 billion (2023 ₦108.4 billion; 49.03% of total), attributed to increased production levels, improved utilisation of the Trans Niger Pipeline (TNP), significant reduction in Crude losses and additional value from the Alternative Crude Evacuation (ACE) system, culminating in higher crude oil sales of 3.1 mbbls in 2024 (FY 2023: 2.1 mbbls).
- 175.9% increase in gas revenue to ₦28.2 billion (4.8% of total revenue), due to higher production volumes (FY 2023: ₦10.2 billion; 4.6% of total revenue).
- 74.9% increase in refined products’ revenue (30.9% of total revenue) to ₦179.3 billion (FY 2023: ₦102.5 billion; 46.4% of total revenue) due to increased sales volumes of 240.5 mmltres, up by 14.47% (FY 2023: 210.1 mmltres).
Cost of sales (COS) 1
Increased by 185.0% to ₦224.6 billion (FY 2023: ₦78.8 billion). This was primarily driven by:
- Crude Handling Charges (42.4% of COS) which increased by 232.0% to ₦95.3 billion (FY 2023: ₦28.7 billion) arising from increased utilisation of the Trans Niger Pipeline (TNP) and ACE operations.
- Depreciation (34.8% of COS) increased by 434.2% to ₦78.2 billion (FY 2023: ₦14.6 billion) due to higher hydrocarbon production, and the addition of newly completed wells.
- Royalties & Other Statutory expenses increased by 229.9% to ₦58.4 billion (FY 2023: ₦17.7 billion). This is attributable to higher production levels during the period.
- Stock adjustment increased to a credit of ₦26.7 billion (FY 2023: ₦1.1 billion) due to higher inventory levels in 2024.
- Decommissioning provisions decreased YoY following the implementation of PIA regulations on Decommissioning and Abandonment, triggering a one-off ₦45.3 million writeback (Provision no longer required’; FY 2023: ₦ NIL).
1 Includes stock adjustment credit of ₦26.7 billion and Provision no longer required of ₦45.3 billion.
General and Administrative (G&A) expenses increased by 176.1% to ₦56.2 billion (FY 2023: ₦20.4 billion). The major drivers of this growth include:
- Staff costs (36.4% of G&A expenses) increased by 340.5% to ₦20.5 billion (FY 2023: ₦4.6 billion) mainly due to staff additions and employee remuneration adjustments.
- Permits, licenses and subscription (15.3% of G&A expenses) increased by 139.0% to ₦8.6 billion (FY 2023: ₦3.6 billion) due to increased technology subscription expenses
- Professional Fees (9.8% of G&A expenses) increased to ₦5.5 billion, up 177.7% (FY 2023: ₦2.1 billion) primarily due to Naira devaluation and transaction fees on Listing and other key corporate activities.
- Other expenses2 (7.7% of G&A expenses) increased by 38.5% to ₦4.3 billion (FY 2023: ₦3.1billion) primarily due to devaluation.
Operating profit of ₦291.4 billion, up 155.5% (FY 2023: ₦114.06 billion) due to strong margins and higher realised price as evidenced by increased revenue in 2024 and a one-off write-back in Asset Retirement Obligation (“ARO”) liability provisions following current year re-estimations.
Finance costs increased by 89.4% to ₦22.2 billion (FY 2023: ₦11.7 billion) driven primarily by naira devaluation which offset the decrease in the interest expense in US Dollar terms from the ongoing settlement of our loan obligations. Finance Income increased by 141.4% to ₦16.0 billion (FY 2023: ₦6.6 billion) resulting from the amounts earned on invested cash and cash equivalents.
Profit before tax of ₦316.8 billion, up by 182.4% (FY 2023: ₦112.2 billion), with an Income tax expense estimate of ₦57.7 billion (Cash Tax ₦36.5 billion and Deferred tax ₦21.2 billion), relative to FY 2023 tax expense of ₦58.4 billion.
Profit after tax increased by 382.1% to ₦259.1 billion (FY 2023: ₦53.7 billion).
Year-to-date growth in total assets of 89.5% to ₦1.7 trillion (FY 2023: ₦923.4 billion) driven by:
- Increase in Property, plant and equipment by 76.2% to ₦677.9 billion (FY 2023: ₦384.6 billion). This was impacted mainly by increased capital expenditure and higher FX rates.
- Financial assets increased by 968.5% to ₦43.3 billion (FY 2023: ₦4.1 billion), primarily driven by new investments made during the financial year.
- Increase in the value of assets of ND Western, the Company’s associate, to ₦490.0billion, up 81.3% year-todate (FY 2023: ₦270.2 billion) due to share of profit and other comprehensive income for the period.
Total liabilities rose by 58.0% to ₦345.7 billion (FY 2023: ₦218.8 billion). This increase is attributable to higher tax liability estimates from higher performance for the year and the Naira devaluation.
Total equity increased by 99.3% to ₦1.4 trillion (FY 2023: ₦704.6 billion) primarily due to the retention of total comprehensive income over the period.
Cash flows from operating activities The Company generated cash flows from operations of ₦339.1 billion as at FY 2024, an increase of 133.1% (FY 2023: ₦145.5 billion), and net cash flows from operating activities of ₦311.9 billion, were up 124.4% (FY 2023: ₦139.0 billion). This growth was buoyed by receipts of US$42 million from December 2023 crude oil sales, as well as strong margins in crude oil and refinery product sales (and cash receipts).
Cash flows from investing activities
Net cash flow used in investing activities was N128.7 billion, up 185.8% (FY 2023: N45.1 billion). This increase is mainly driven by capital expenditure of ₦136.8 billion in 2024 (FY 2023: ₦48.9 billion) due to the four-well drilling campaign, and the attendant foreign exchange effects.
Cash flows from financing activities
Net cash flows used in financing activities rose to N113.8 billion, up 129.0% (FY 2023: N49.7 billion), due to dividend payments (N71.9 billion) during the year and net repayments of borrowings (N41.9 billion).
Proposed Dividend
The Board is pleased to propose a final dividend of ₦22.0 per share for the year ended 31 December 2024, subject to shareholder approval at the upcoming Annual General Meeting.
Responsibility for publication
The Board member responsible for arranging the release of this announcement on behalf of Aradel Holdings is Adegbola Adesina, CFO Aradel Holdings Plc.
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