Nascon Allied Industries Plc has announced its unaudited financial results for the first quarter of 2025, delivering a staggering 515% year-on-year growth in pre-tax profit to N11.310 billion.
The result places the company, a key member of the Dangote Group, on a trajectory that could see it record its most profitable year yet if the momentum is sustained.
The company, valued at N143 billion on the Nigerian Exchange (NGX) as of April 25, 2025, also reported a 515.02% year-on-year increase in profit after tax, rising to N7.578 billion. Remarkably, this figure already accounts for 48.63% of the company’s full-year 2024 net profit, signaling an aggressive earnings acceleration barely three months into the year.
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A breakdown of the financials shows that Nascon recorded a revenue of N41.853 billion during the period under review, representing a 77.21% increase compared to the N23.613 billion posted in the corresponding period of 2024. The cost of sales also rose significantly to N23.957 billion, reflecting a 92.26% increase over the same period last year. Gross profit, however, climbed to N17.896 billion, marking a 60.39% rise, while selling and distribution expenses recorded a modest increase of 2.51%, amounting to N5.119 billion.
Another highlight was the company’s net finance income, which jumped to N887 million, representing an impressive 1,359.37% surge compared to the same quarter in 2024. Basic earnings per share doubled, rising by 101.08% to N3.74, while cash and cash equivalents stood at N5.615 billion at the end of the quarter, a 30.25% increase. Total assets grew to N25.011 billion, up 17.17% year-on-year.
A closer look at the results shows that Nascon’s extraordinary performance was driven by several interconnected factors. Chief among them was strong revenue growth and a moderation in overhead cost increases. Revenue from the northern segment of its market operations surged by over 86% year-on-year and contributed more than 77% of the company’s total revenue, underscoring Nascon’s deepening penetration and market dominance in the northern region where demand for its products has remained resilient.
On the cost side, the company faced pressure from raw material expenses, which now account for more than 87% of the total cost of sales. This reflects the persistent volatility in commodity prices and inflationary pressures that continue to impact the Nigerian manufacturing sector. Operating expenses, though elevated, did not grow as aggressively as revenues, helping the company defend its margins.
Another crucial driver of Nascon’s outstanding profit growth was the sharp decline in foreign exchange losses. In Q1 2024, the company had recorded N3.056 billion in forex-related losses, a figure that plummeted to just N55.38 million in Q1 2025. This significant improvement provided a major boost to the bottom line, helping to offset inflation-induced cost pressures and offering some insulation against Nigeria’s volatile macroeconomic backdrop.
The company’s balance sheet also reflects strengthening fundamentals. Total assets rose by 7.09% to N90.817 billion, with current assets making up over 82% of that figure, indicating a strong liquidity position. Nascon’s equity position improved substantially, with shareholders’ equity growing by 76.40% to N50.633 billion. As a result, equity now accounts for 55.73% of total assets, demonstrating a more robust financial foundation where the majority of assets are funded by shareholders’ capital rather than debt.
Furthermore, Nascon’s debt position improved significantly. Total borrowings declined to N1.145 billion as of the end of March 2025, down from N3.696 billion recorded at the end of December 2024. This deleveraging strategy, combined with the strong operating performance, helped lower the company’s interest expenses and substantially improved its interest coverage ratio. The financial flexibility gained from lower debt levels positions Nascon better to weather any unforeseen market shocks in the months ahead.
On the stock market, Nascon’s performance has reflected the strength of its fundamentals. The company began the year with a share price of N31.35 and has gained 68.9% year-to-date, making it the 11th best-performing stock on the Nigerian Exchange so far in 2025. Over the past four weeks alone, Nascon’s stock has appreciated by 20%, ranking it as the 8th-best performer over that period.
Investors have also enjoyed decent returns through dividends. For the 2024 financial year, Nascon declared a dividend of N2 per share, offering a dividend yield of 3.78% based on its end-of-year share price, further strengthening its attractiveness to income-focused investors.
Nonetheless, challenges persist despite the strong showing. Rising raw material costs and continued input price volatility present ongoing risks to operating margins. Delivery expenses are also expected to remain elevated, especially given Nigeria’s unpredictable fuel pricing environment and logistical difficulties. Although forex losses have sharply reduced, any resurgence in exchange rate instability could reintroduce pressures on the bottom line.
Looking ahead, analysts believe that Nascon’s ability to sustain its record pace of profit growth will depend largely on its capacity to manage these cost-side pressures and maintain its revenue momentum, particularly in its northern stronghold where sales have boomed. If the first quarter’s performance is any indication, however, the company appears well-poised to deliver another year of exceptional growth, consolidating its status as one of Nigeria’s top-performing industrial players.