Lagos, Nigeria | August 7, 2025
Downstream oil and gas giant Conoil Plc has reported its lowest half-year profit in five years, as declining revenues, shrinking profit margins, and mounting finance costs took a toll on the company’s performance in the first half of 2025.
According to its unaudited financial statement released to the Nigerian Exchange (NGX), Conoil posted a profit before tax of just N1.3 billion for the six-month period ending June 30, a sharp decline from N2.9 billion recorded in the same period of 2024. This marks the weakest mid-year earnings since 2020.
Revenue also dipped slightly to N59.2 billion from N61.7 billion in H1 2024, reflecting a slowdown in sales volume and increased competition in the petroleum products market. However, analysts point to surging finance costs, up by over 70% year-on-year, as a major drag on overall profitability.
“The company’s cost of borrowing has become increasingly burdensome due to high interest rates and tighter credit conditions,” said a Lagos-based market analyst. “These rising expenses are eroding whatever gains they could have made through operational efficiency.”
Additionally, the company’s gross profit margin narrowed due to elevated input costs and limited pricing flexibility in a regulated market environment. This combination of economic headwinds has heightened concerns among investors about the short-to-medium term outlook for players in Nigeria’s downstream oil sector.
Despite the underwhelming results, Conoil’s management expressed cautious optimism about the second half of the year, stating that strategic cost control measures and expected improvements in product supply logistics may help stabilize margins.
Market watchers, however, say much will depend on macroeconomic trends, including exchange rate stability and interest rate movements, which continue to significantly influence the performance of oil marketing firms in Nigeria.