Aradel Holdings (NGX: ARADEL) reported a sharp increase in first-quarter earnings as the consolidation of ND Western Limited and its majority interest in Renaissance Africa Energy transformed the scale of the Nigerian energy group's operations, boosting production, revenue and cash generation.
Revenue rose 265% year on year to NGN728.5bn ($526.5mn), compared with NGN199.9bn in the same period of 2025. EBITDA increased 518% to NGN537.7bn, while operating profit climbed 487% to NGN372.9bn. Profit before tax rose 323% to NGN283.8bn and profit after tax increased 252% to NGN120.3bn, reflecting higher hydrocarbon output and stronger realised oil prices.
Production averaged 141,118 barrels of oil equivalent per day (boepd), compared with 18,280 boepd a year earlier. Crude oil production rose 276% to 56,510 barrels per day (bpd), while gas output surged 2,503% to 507.7mn cubic feet per day (mmcfd) following gas plant revamps, improved pipeline availability and sustained customer demand. Refined product output, however, declined 21% to 698.3 kilolitres per day because of feedstock shortages, offtake constraints and operational disruptions.
Cash generation strengthened substantially. Cash generated from operations jumped more than 27-fold to NGN868.3bn, while cash and cash equivalents rose to NGN1.6 trillion, giving the company one of the strongest liquidity positions among indigenous Nigerian producers. Net operating cash flow amounted to NGN868.3bn after tax payments of NGN41.1bn.
Chief executive Adegbite Falade said the results reflected the benefits of the enlarged asset base.
'Aradel Holdings’ first quarter results mark an important milestone — the first full quarter in which the earnings and cash flows of our enlarged Group are reflected in our financial statements, following the consolidation of NDW as a subsidiary and our resulting majority interest in Renaissance,' Falade said.
'Production tripled to 12.9 mmboe and cash generated from operations rose by 27x to NGN868.3bn. Revenue of NGN728.5bn and profit after tax of NGN120.3bn demonstrates the strength of our diversified portfolio across upstream, gas, and refining and the immediate benefits of our expanded asset base.'
He added: 'Our focus for the rest of 2026 is to optimise our existing asset base, improve operational efficiency, increase production, and further diversify our revenues.'
The quarter was the first to reflect the consolidation of ND Western as a subsidiary, giving Aradel an effective 53.3% interest in Renaissance Africa Energy Company, the consortium that completed the acquisition of Shell Petroleum Development Company of Nigeria (SPDC) from Shell plc (LSE: SHEL; NYSE: SHEL) earlier this year. The transaction significantly expanded Aradel's upstream footprint and strengthened its exposure to natural gas production and infrastructure.
Through its holdings in ND Western and Renaissance, Aradel now has interests in a broader portfolio of oil and gas assets, substantially increasing the group's scale and strengthening its position among Nigeria's leading indigenous energy producers. The expansion aligns with the government's efforts to transfer mature onshore assets from international oil majors to domestic operators.
Aradel's gas business also continued to strengthen. Aradel Gas Limited, the group's wholly owned gas subsidiary, remains Nigeria's only independent non-joint venture gas supplier to Nigeria LNG and operates a 100mmcfd processing facility. Increased gas production during the quarter benefited from improved pipeline availability and stronger customer demand, reinforcing management's strategy of expanding exposure to domestic gas markets.
Higher borrowings and the enlarged scale of operations pushed finance costs up sharply to NGN101.8bn from NGN5.4bn a year earlier, while tax expenses climbed to NGN163.5bn. Total borrowings stood at NGN1.78 trillion and decommissioning liabilities at NGN1.41 trillion. Total assets reached NGN9.06 trillion at the end of March, compared with NGN9.9 trillion at the end of 2025.
The group also recorded a negative foreign currency translation adjustment of NGN234.0bn, contributing to a total comprehensive loss of NGN111.4bn despite strong underlying profitability. Profit attributable to shareholders amounted to NGN66.2bn, while non-controlling interests accounted for NGN54.1bn. Basic earnings per share increased to NGN15.24 from NGN7.77 a year earlier.
Aradel, originally incorporated as Midas Drilling Fund in 1992 and renamed in 2023, is one of Nigeria's largest indigenous integrated energy companies. Its portfolio includes Aradel Energy, Aradel Gas and Aradel Refineries, which operates an 11,000 barrels-per-day refinery producing diesel, kerosene, marine diesel oil, heavy fuel oil and naphtha. The company listed on the main board of the Nigerian Exchange in October 2024 and has pursued an expansion strategy aimed at building a diversified upstream, gas and refining platform.
Nigeria's indigenous producers have expanded their role following the withdrawal of international oil majors from onshore operations. The country's oil production averaged around 1.6mn barrels per day (bpd) in the first quarter, according to official data, while the government is seeking to raise output above 2mn bpd through increased investment and greater participation by local operators. Aradel's enlarged position through Renaissance leaves it well placed to benefit from that shift.
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