Geregu Power Declares Dividend Amidst Tight Earnings Performance
Geregu Power Plc’s full-year audited reports and financial statements for the year ended December 31, 2025 present a mixed but largely resilient performance profile, characterised by strong top-line expansion, moderated profitability growth, and balance sheet stretching amid an evolving operating and leadership landscape.
The company delivered a robust 34.88% year-on-year (YoY) revenue growth, with turnover rising to N184.95 billion from N137.13 billion in 2024. This underscores improved generation capacity utilisation, tariff dynamics, and sustained demand within Nigeria’s power value chain. However, the revenue acceleration came at a cost.
Cost of sales expanded sharply by 49.0% YoY to N110.73 billion (2024: N74.30 billion), reflecting higher gas costs, inflationary pressures, and operational inefficiencies inherent in the sector.
Despite this, gross profit increased by 18.3% to N74.21 billion (2024: N62.73 billion), indicating Geregu’s ability to partially pass costs through pricing and maintain scale advantages.
Other income rebounded positively to N1.80 billion, reversing a prior-year deficit of N583.8 million, providing incremental earnings support. However, this was largely offset by a near-doubling of administrative expenses to N17.82 billion (2024: N9.79 billion), pointing to higher personnel costs, corporate overheads, and transition-related expenditures.
Impairment charges on financial assets also rose to N10.05 billion from N9.40 billion, highlighting persistent receivables risk in Nigeria’s electricity market. Notwithstanding these headwinds, operating profit rose 12.1% YoY to N48.15 billion (2024: N42.95 billion), reflecting operational resilience and disciplined cost containment at the core level.
The financing profile weakened in 2025. Finance income declined to N6.43 billion (2024: N8.54 billion), while finance costs increased to N12.59 billion from N10.23 billion, driven by elevated interest rates and residual debt servicing. Consequently, net finance cost deteriorated materially to N6.16 billion from N1.69 billion.
Profit before tax edged up marginally by 1.74% YoY to N41.99 billion, while profit after tax slipped slightly to N27.25 billion (2024: N27.43 billion), despite higher revenues. The increase in income tax to N14.73 billion reflects improved taxable capacity and reduced tax shields. Earnings per share moderated marginally to N10.90 from N10.97, signalling earnings plateauing.
Total assets expanded by 25.27% YoY to N305.01 billion, driven largely by a sharp increase in trade and other receivables to N201.11 billion (2024: N121.82 billion). While this supports revenue growth, it raises liquidity and collection risk concerns. Trade and other payables also ballooned to N136.86 billion, indicating increased reliance on supplier credit.
Cash and cash equivalents declined by 20.25% to N31.85 billion, reflecting working capital absorption. Encouragingly, borrowings reduced to N24.18 billion from N32.07 billion, signalling balance sheet deleveraging. Retained earnings improved to N57.34 billion, reinforcing capital buffers.
In line with its earnings resilience, the Board declared a final dividend of N9.00 per share, subject to shareholder approval at the AGM. This reflects management’s confidence in cash-flow sustainability despite rising operational and financial pressures.
At the current market price of N1,141.50, Geregu Power trades at a premium valuation relative to near-term earnings growth, underpinned by its strategic positioning as a leading listed power generation company.
The change in management leadership introduces both execution risk and upside optionality, particularly if the new leadership accelerates operational efficiency, strengthens receivables recovery, and deepens participation in sector reforms.
Investor’s Recommendation:
In analysts’ opinion, they’re advice short term “Hold” as earnings growth is constrained by cost pressures, financing drag, and liquidity tightening. While for medium-to-long term, they suggest an “Accumulate” on weakness due to strong revenue trajectory, declining borrowings, retained earnings growth, and sector reform tailwinds support long-term value creation.
Overall, Geregu Power remains fundamentally viable, revenue-strong, and strategically relevant. However, sustained shareholder value will depend on management’s ability to convert topline growth into stronger free cash flows, protect margins, and manage balance-sheet risks in Nigeria’s evolving power market. #Geregu Power Declares Dividend Amidst Tight Earnings Performance#
Geregu Power: Board Approves FY2025 Accounts, Proposes N9 Final Dividend
