Despite Economic Challenges, 20 Blue-chip Firms Double Revenue to N20.36trn

.FX losses weaken profit

Kayode Tokede 

Amid domestic and foreign macro-economic challenges, a total of 20 blue-chip firms listed on the Nigeria Exchange Limited (NGX), generated an estimated N20.36 trillion revenue in 2024 to underline resistance in driving top line growth. 

The  N20.36 trillion revenue growth in 2024 is about 63 per cent increase over N12.5 trillion reported in 2023 financial year.  

The 20 firms comprises:  cement manufacturing companies,  telecommunication, power generating, oil & gas, Fast-Moving Consumer Goods (FMCG), among others. 

An independent investigation by THISDAY revealed the firms grew revenue significantly amid a double-digit inflation rate that has led to a spike in cost of food and services across the country. 

But the cost of operation and foreign exchange loss weakened profit generation and impacted on 2024 financial result and accounts and dividend payout to shareholders. 

Companies operating in Nigeria in 2024 were faced with low purchasing power amid hike inflation that spread across Africa, weakened naira at the foreign exchange, insecurity and bad road networks that prolonged delivery of goods and services across the country.

THISDAY investigation showed hat Oil & Gas companies benefited from the federal government’s reforms in the sector, a critical factor that impacted on revenue and profit generation in the period under review. 

In the period under review, Oando Plc, followed by Dangote Cement, Plc, MTN Nigeria Communication Plc,  Seplat  Energy Plc,  and Nigerian Breweries Plc led others in revenue generation.

Specifically, Oando  reported revenue of about N4.12 trillion in 2024, about 44.9 per cent increase from N2.85 trillion reported in 2023.

With the increase in the price of Cement, Dangote Cement posted N3.58 trillion revenue, representing an increase of 62.2 per cent from N2.21 trillion in 2023.

The Chief  Executive Officer, Oando Plc, Mr. Wale Tinubu, in a statement  stated that, “2024 was a year of transformation for Oando, the key highlight being our successful acquisition  and subsequent integration of NAOC Ltd, which significantly enhanced our production capacity,  attaining peak operated production of 103,206 boepd and net entitlements of 45,000 boepd.

“Despite a challenging operating environment, we achieved a 45 per cent increase in revenue to N4.1  trillion, reflecting the strength of our business model and a nine per cent rise in profit after tax to N65.5 billion, notwithstanding the costs associated with the onboarding of NAOC.”

On his part, Chief Executive Officer and Group Managing Director of Dangote Cement, Arvind Pathak, said, “We wrapped up 2024 with strong momentum, driven by our focus on operational efficiency and excellence.

“Our group volume grew by 1.6 per year-on-year, reaching 27.7 Mt, driven by a strong recovery in Nigeria, where we improved efficiency and boosted sales growth by 7.9 per cent.

“Despite macroeconomic challenges, both globally and domestically, we remain committed to innovation and value creation, delivering strong returns for our stakeholders.”

He noted that the group’s revenue grew by 62.2 per cent to N3.58 trillion in 2024, which was driven by a combination of volume growth and price adjustments to reflect inflationary trends.

For MTN Nigeria, it declared N3.36 trillion revenue in 2024, about 36 per cent increase over N2.47 trillion reported in 2023. 

The demand for MTN Nigeria services remained strong in 2024, supported by disciplined commercial execution. 

According to the telecommunication giant, its service revenue increased by 35.9 per cent, to highlight its ability to consistently deliver value to customers. 

“The overall revenue performance was supported by our robust strategy for acquiring and retaining subscribers – which mitigated the impacts of NIN-SIM registration regulations – as well as driving usage. Voice revenue was solid, increasing by 14.5per cent on the back of higher usage and an expanding user base,” the company stated. 

In addition, Seplat  Energy reported N1.65 trillion revenue in 2024, about 137 per cent increase from N696.9 billion in 2023, while Nigerian Breweries announced N1.08 trillion revenue in 2024,  representing an increase of 80.8 per cent from N599.6 billion declared in 2023. 

Nigerian Breweries, however, closed the year under review with a net loss of N144.9 billion from N106.3 billion the corresponding year.

The Managing Director/CEO, Nigerian Breweries, Mr. Hans Essaadi in a statement said the impressive year-on-year revenue growth was largely driven by strategic pricing initiatives, market expansion, successful innovations, and operational efficiencies.

”Despite macroeconomic headwinds faced by the company, group operating profit surged by 54per cent, reflecting the success of cost management, process optimization and strong operational performance,” he noted. 

He added that the 34 per cent increase in the net finance costs, and the 36per cent increase in the net loss recorded by the company were driven by the rise in interest rates as well as the impact of the devaluation of the naira.

Analysts stated that despite facing significant economic challenges such as elevated inflation, a depreciating exchange rate, and ongoing security concerns, these companies have been resilient over the years.

They expressed further that these companies operating in Nigeria took advantage of a hike in inflation rate, among others to increase the price of goods and services in 2024, a key element that reflected on revenue. 

Commenting, Investment Banker and Stockbroker, Mr. Tajudeen Olayinka said: “2024FY revenue growth is a reflection of Nigeria’s economy adding, “There was an increase in goods & services amid double digit inflation and these companies passed the cost effect to customers that eventually drove their revenue.”

He added that Nigeria companies remain resilient amid growing challenges, even though some  were unable to pay dividends but increase their revenue which in years to come, it  is expected to impact on profit generation and dividend payout to shareholders. 

On his part, Analyst and Managing Director, High Cap Securities Limited, David Adonri stated that: “Nigeria’s economy is witnessing challenges including hike in inflation, insecurity, removal of subsidy, unstable foreign exchange, among other factors that have continued to have mixed performance on revenue generation.

He added, “However, we should commend these firms for generating a significant increase in revenue and it has outperformed 2023FY results.”