WorldStage– Geregu Power Plc has reported a steep decline in earnings for the half-year ended 30 June 2026, with profit after tax falling 87.7% to ₦2.50 billion from ₦20.28 billion in the corresponding period of 2025.
According to the unaudited interim financial statements filed with the Nigerian Exchange, revenue dropped sharply to ₦18.66 billion, down from ₦87.63 billion in H1 2025.
Gross profit declined to ₦6.93 billion from ₦35.75 billion in the prior-year period.
The power generation company, one of Nigeria’s largest listed electricity producers, saw basic earnings per share contract significantly in line with the fall in net profit.
The weak performance follows a challenging first quarter in which revenue and profitability already showed marked declines, reflecting broader pressures in the power sector, including issues around generation output, gas supply, or offtake payments.
Despite the earnings pressure, the company had earlier projected stronger results for the second quarter (including an expected ₦8.17 billion profit after tax for Q2 alone).
The actual half-year outcome indicates that operational challenges persisted through June.
Geregu Power Plc operates gas-fired power plants and remains one of the more prominent names on the Nigerian Exchange.
The results highlight ongoing volatility in the electricity value chain even as the company continues to maintain a sizeable market capitalisation.
Operational Challenges
Geregu Power Plc experienced a severe earnings collapse in the first half of 2026. Revenue fell from ₦87.63 billion in H1 2025 to just ₦18.66 billion, while profit after tax dropped from ₦20.28 billion to ₦2.50 billion (an 88% decline).
This followed a already weak Q1 in which revenue was down 43% and PAT down nearly 80%.
The challenges are largely structural to Nigeria’s power sector rather than company-specific mismanagement, though the ownership transition amplified market concerns.
- Gas Supply Constraints (Primary Driver)
Nigeria’s gas-fired power plants, including Geregu, continue to face chronic gas availability and pricing issues:Gas suppliers have increasingly cut supply to generation companies (GenCos) over unpaid debts.
Sector-wide GenCo debts to gas suppliers exceed ₦3 trillion, leading to forced outages or reduced output at multiple plants.
Domestic gas infrastructure limitations and competition for gas (especially with export and industrial demand) have made reliable feedstock scarce or expensive.
Higher reliance on costlier alternative or spot gas purchases has squeezed margins.
This is the most frequently cited reason for lower generation volumes across the industry in 2026.
- Liquidity and Payment Chain Dysfunction
Persistent non-payment or delayed payment by the Nigerian Bulk Electricity Trading Plc (NBET) and Distribution Companies (DisCos).
High trade receivables remain a major issue (Geregu reported elevated receivables of ₦200 billion in Q1 2026).
Weak cash collection cascades upstream, limiting the company’s ability to pay for gas and maintain operations at full capacity.
- Lower Capacity Utilisation / Generation Output
The sharp revenue drop implies significantly lower electricity dispatched to the grid. Possible contributors include:Forced outages or reduced running hours due to gas shortages.
Plant maintenance or efficiency issues (common in ageing gas turbines).
Grid constraints or lower demand offtake by the Transmission Company of Nigeria (TCN) / DisCos.
- Ownership Transition Effects
Femi Otedola exited his controlling stake in late 2025 via a large transaction, with MA’AM Energy emerging as the new major shareholder.
Analysts have suggested that the transition and strategic realignment may have contributed to softer operational focus or temporary disruptions in Q1–H1 2026.
Management has stated that operations remain stable, but the market has remained sceptical.
- Broader Sector Headwinds
Inadequate tariffs that do not fully cover the true cost of generation.
High inflation and naira volatility increasing operating costs.
Regulatory and policy uncertainty in the Nigerian Electricity Supply Industry (NESI).
Outlook and Mitigants
Geregu has reduced some debt and maintained a relatively solid equity base.
The company earlier projected stronger Q2 numbers (including ~₦8.17 billion PAT for the quarter alone), but actual H1 results show the challenges persisted.
Recovery will depend on improved gas supply reliability, better collections from NBET/DisCos, higher plant utilisation, and successful execution under the new ownership.
In summary, Geregu’s Q2/H1 2026 performance was severely impacted by industry-wide gas supply cuts, the broken payment chain in the power sector, and lower generation volumes. These structural issues continue to overshadow the company’s individual operational strengths and balance-sheet resilience.
