Aradel Holdings has published its audited 2025 financial results, showing headline profit before tax of N835.01 billion — a 163.60% increase from N316.77 billion in the prior year. Profit after tax rose by 192.33% to N757.34 billion.
The striking growth, however, was largely driven by accounting entries tied to the company's acquisition of additional interests in ND Western and Renaissance.
Of the N835.01 billion pre-tax profit, N610.29 billion — or 73.1% — came from two non-cash items: a N217.10 billion gain on bargain purchase and a N393.19 billion translation gain on business combination. The translation gain was a reclassification of foreign-currency differences previously recorded in other comprehensive income, while the bargain-purchase gain arose because the fair value of acquired net assets exceeded the acquisition price.
After factoring in a N106.30 billion fair-value loss on the ND Western acquisition, the net accounting uplift stood at N503.99 billion, representing about 60.36% of reported pre-tax profit.
Excluding these acquisition-related items, adjusted pre-tax profit would have been N331.02 billion — representing growth of just 4.50% compared with 2024. The picture at the operating level is even starker. Reported operating profit came in at N733.58 billion, but adjusted operating profit — stripping out the bargain purchase and translation gains and adding back the step-acquisition loss — would have been N229.60 billion, a decline of 21.21% from N291.40 billion in 2024.
Revenue grew by 20.35% to N699.43 billion, but cost of sales surged 74.16% to N391.22 billion, causing gross profit to slide 13.55% to N308.21 billion.
Cash generation also diverged sharply from reported earnings. Net cash from operating activities fell 42% to N179.70 billion from N311.88 billion, underscoring the gap between paper profits and cash realisation.
Despite the accounting-driven profit, Aradel's board recommended a final dividend of N23 per share, amounting to N99.93 billion. Together with an interim dividend of N10 per share (N43.45 billion), total dividends for 2025 stand at N33 per share or N143.38 billion, compared with N30 per share and N130.35 billion in 2024. The total dividend represents about 79.8% of operating cash flow.
Chief Executive Officer Adegbite Falade said the additional 40% investment in ND Western and the resultant increase in Aradel's total effective interest in Renaissance to 53.3% had "significantly expanded our reserves, production base and operational footprint, positioning Aradel to operate at materially greater scale from 2026 onwards." He noted the consolidation had "fundamentally reset the scale of the Company's balance sheet."
On the operational front, crude oil and condensate production rose 3% to 5.2 million barrels, while crude oil sales increased 32% to 4.1 million barrels. Gas production climbed 59% to 18.8 Bcf. Downstream refined product output grew 18% to 313.4 million litres, and refinery utilisation improved to 49% from 40%.
The real test for Aradel begins in 2026 when the full earnings contribution of ND Western and Renaissance is expected to appear in the consolidated income statement, replacing 2025's one-off paper gains with recurring, cash-backed earnings.
Aradel's shares have gained approximately 161% year-to-date.
