Oando Plc, one of Nigeria’s top oil and gas companies led by Wale Tinubu, reported half-year net profit of $50.2 million in 2026, reflecting the swing to operating profit and the impact of a tax credit amid improved operational efficiency, higher production levels, and sustained cost optimization across its expanded asset base.

The company also posted revenue of N2.1 trillion ($1.54 billion), led by growth in the E&P segment and higher product prices. The company’s growth was driven by increased output from its upstream portfolio, improved facility uptime, and stronger oil prices, marking a continued recovery following its major asset expansion in recent years.

Production, trading lift revenue amid stronger prices

Oando recorded an 8% increase in profit after tax to N68.6 billion ($50.2 million), from N63.3 billion ($46.31 million) a year earlier, supported by stronger operating performance, tax credits and higher production. Average daily production rose 16% year-on-year to 42,789 barrels of oil equivalent per day (boepd), driven by new wells, the restoration of previously shut-in wells and improved operational uptime. Operating expenses fell 18% to $16.83 per barrel as the company’s cost-optimization strategy delivered savings across its expanded asset base.

Revenue increased 20% to N2.1 trillion ($1.54 billion), from N1.7 trillion ($1.24 billion), reflecting higher production, improved realised prices and stronger trading activity. Crude oil lifted volumes rose 14% to 2.64 million barrels, generating N245.8 billion ($180 million) in revenue as average realised prices increased 19% to $79.22 per barrel.

Natural gas sales also strengthened, with volumes rising 31% to 25.12 billion standard cubic feet and revenue reaching N62.5 billion ($46 million). Average realised gas prices increased to $1.78 per thousand cubic feet, while NGL revenue rose to N4 billion ($2.93 million), primarily on higher volumes. Trading remained Oando’s largest revenue contributor, with revenue increasing 18% to N1.72 trillion ($1.26 billion), driven by stronger prices during the period.

Profit rebounds as costs fall, impairments reverse

The group’s profitability improved sharply at the operating level. Oando reported an operating profit of N127.8 billion ($93.5 million), reversing a loss of N158.7 billion ($116.1 million) recorded in the same period last year. This turnaround was driven by a surge in gross profit, which jumped 331% to N101 billion ($74 million), reflecting lower operating and production costs and improved efficiency across its expanded asset base.

Administrative expenses declined slightly by 4% to N77.8 billion ($57 million), supported by a foreign exchange gain and lower depreciation costs. In addition, the company recorded a net impairment reversal of N55.9 billion ($41 million) on financial assets, aided by improved collections on receivables. A key factor behind the improved operating performance was the absence of large one-off losses recorded in 2025, including a N311.6 billion ($227.96 million) fair value loss on financial asset modifications.

Finance costs surge despite balance sheet progress

Despite stronger operating results, Oando faced mounting financial pressure from rising borrowing costs. Net finance costs widened to N161.3 billion ($118 million), compared to a net finance income position in the prior year, as finance income dropped sharply and interest expenses increased.

Interest payments alone consumed a significant portion of operating cash flow, with N98.9 billion ($72.35 million) paid during the period, equivalent to about 55% of cash generated from operations. The company noted that reducing this burden remains a central focus of its ongoing capital restructuring programme.

Cash flow strengthens, liquidity improves

Oando recorded a positive turnaround in cash generation, with net cash from operating activities reaching N110 billion ($8.05 million), compared to a significant outflow in the prior year. The improvement was driven by stronger operating performance and better working capital management.

The group closed the period with cash and cash equivalents of N544.9 billion ($398.64 million), up sharply from N194.2 billion ($142.07 million) a year earlier, providing improved liquidity headroom despite continued capital expenditure and debt servicing obligations.

Total borrowings stood at N2.7 trillion ($1.98 billion) as of June 2026, largely unchanged from year-end levels, while net debt declined to N2.16 trillion ($1.58 billion) due to higher cash reserves.

Tinubu pushes operational growth, portfolio expansion

Under Wale Tinubu, Oando is maintaining a strong focus on operational efficiency and production growth. The company reported average production of 42,789 barrels of oil equivalent per day in the first half of 2026, up 16% year-on-year and within its guidance range. Oando has continued to execute a broad capital restructuring strategy aimed at strengthening its financial position. The company has successfully restructured key corporate and medium-term loan facilities, restoring them to good standing.

At the same time, it is progressing a N200 billion ($146.32 million) rights issue and a multi-instrument issuance programme of up to $1.5 billion, both of which are intended to reduce leverage, extend debt maturities, and lower financing costs over time. Oando plans to complete a seven-well drilling programme and scale additional activities to meet its full-year production target of 40,000 to 50,000 barrels per day. Beyond core operations, the group is advancing its growth portfolio, including progress on its Angola production sharing contract, as well as developments in clean energy, trading, and mining segments—positioning the company for longer-term expansion across Africa’s evolving energy landscape.