Geregu Power Plc has posted a strong rebound in its financial performance for the second quarter of 2025, recording a pre-tax profit of N13.297 billion, a 61.14% year-on-year growth, and surpassing management’s internal forecast for the period.

The result reinforces the company’s dominance in Nigeria’s electricity generation market and highlights the broader trend of profitability within the nation’s power sector.

Combined with its Q1 pre-tax profit of N13.015 billion, Geregu Power’s first-half profit stood at N26.311 billion. While that reflects a 12.74% decline compared to the same period in 2024—due mainly to a weak Q1—analysts say the impressive Q2 comeback not only restores investor confidence but also signals an industry-wide trend: Nigeria’s power sector is fast becoming one of the country’s most lucrative sectors.

Power Sector’s Rising Appeal

Geregu’s quarter-on-quarter performance offers a telling snapshot of the growing financial potential in the Nigerian electricity market. With consistent demand, limited competition, and government-backed reforms aimed at improving energy infrastructure, the sector is increasingly viewed as a viable hedge against inflation and macroeconomic uncertainty.

Despite the country’s persistent power shortages, producers like Geregu continue to generate strong earnings, owing to favorable tariffs, bulk power sales to the Nigerian Bulk Electricity Trading Company (NBET), and the relative monopolistic structure of Nigeria’s generation sector.

Industry watchers say Geregu’s results may encourage more private sector investment into power generation, especially as returns from traditional sectors like oil and gas, banking, and manufacturing face more regulatory constraints and rising input costs.

Revenue, Margins Show Strength

In Q2 2025, Geregu posted revenue of N55.875 billion, up 84.72% from the N30.249 billion recorded in the same period last year. This performance was particularly important after a disappointing Q1, which saw revenue drop over 37% year-on-year. First-half 2025 revenue ended at N87.633 billion, reflecting a modest 8.62% increase from H1 2024, but Q2 clearly carried the weight of this growth.

Profitability also remained solid. Core operating profit rose by 73.7% year-on-year to N15.01 billion in Q2, while profit after tax surged by 75.61% to N9.75 billion. Earnings per share jumped to N3.90, also up 75.68% from a year earlier.

Geregu’s gross profit margin in Q2 stood at over 42%, despite cost pressures driven by gas supply and transportation expenses, which consumed over 55% of total revenue. The cost of sales jumped by 86.95% to N32.128 billion, aligning with higher generation volumes and fuel costs, but the company still managed to protect its bottom line effectively.

Impairments and Balance Sheet

The power firm did post a sharp increase in impairment losses, which rose nearly 197% to N6.08 billion, likely due to increased provisioning for trade receivables and credit risks. But it didn’t appear to weaken investor sentiment.

Geregu’s total assets climbed to N267.6 billion as of June 30, 2025 — a 9.91% increase from the end of 2024 — driven largely by a 24% surge in trade and other receivables. Retained earnings and shareholders’ funds saw slight declines of 2.08% and 2.03% respectively, but these were marginal compared to the topline and operating performance growth.

Market Outlook

Geregu’s share price stood at N1,141.50 on the Nigerian Exchange (NGX) as of July 11, 2025, reflecting a modest 0.74% dip on the day, though it remains up nearly 188% year-to-date, marking one of the most impressive capital gains on the NGX this year.

Given that H1 profit already accounts for 64% of FY 2024’s total, the company is well-positioned to outperform its full-year targets, barring any severe disruptions in gas supply or national grid failures. Analysts also note that if Nigeria’s transmission infrastructure improves and power theft is reduced through better metering, firms like Geregu stand to benefit even more.

The Next Investment Frontier

Geregu’s Q2 2025 performance affirms what many in the market are beginning to acknowledge: the power sector may be Nigeria’s next frontier for outsized investment returns. Despite its structural bottlenecks and long-standing inefficiencies, power generation—especially for firms with stable capacity, strong management, and NBET contracts—has become a goldmine in the current economic landscape.

As private equity interest and institutional capital continue to flow into power assets, Geregu Power remains a bellwether for what a profitable electricity company in Nigeria can look like. Although analysts expect the coming quarters to further test its consistency, for now, its earnings story stands as one of the most profitable on the Nigerian Exchange.

The Group Chief Executive Officer of Guaranty Trust Holding Company (GTCO), Segun Agbaje, has said Nigerian banks had ample notice to prepare for the end of regulatory forbearance, and therefore the recent decision by the Central Bank of Nigeria (CBN) to phase it out should not come as a surprise.

Agbaje made the remarks on Thursday, July 10, during an event commemorating the company’s secondary listing on the London Stock Exchange (LSE), where GTCO officially began trading under the ticker “GTHC.”

“We had letters — there was enough time”

Addressing the issue of regulatory forbearance, a temporary relief policy introduced to ease the pressure of non-performing loans during turbulent periods, Agbaje was unequivocal.

“I don’t think forbearance or the exit of forbearance should have come as a surprise to banks. We all basically had letters saying it would end in 2023. Therefore, we should have exited by the end of 2024. So whatever the regulators chose to do should not have come as a surprise,” he said.

The remarks come amid complaints from some bank executives who described the CBN’s timing as abrupt. But Agbaje’s comments appear to challenge that narrative, suggesting the industry had more than enough time to align with the exit timeline.

On CRR and inherited liquidity overhang

On the broader regulatory environment, Agbaje also weighed in on the controversial Cash Reserve Ratio (CRR), which banks say locks away an excessive portion of their deposits at the CBN, thereby tightening liquidity and curbing lending ability.

“CRR is a result of a liquidity overhang that was inherited by this government and this central bank. You have to find a methodical way of getting rid of the liquidity,” he said, defending the CBN’s posture. “My belief is that as the central bank sees normalized liquidity, they will reduce CRR over time. But I don’t think it’s realistic to expect them to just release CRR in the midst of what is a large liquidity overhang.”

The CBN has faced criticism for sequestering over N15 trillion in the banking sector CRR — a situation many analysts argue restricts banks’ ability to lend and weakens earnings. But Agbaje’s stance suggests an understanding of the regulator’s cautious approach to liquidity management.

Navigating tough international regulatory terrain

Agbaje also spoke about the intense regulatory scrutiny faced by GTCO during its London listing process, including requirements from the UK’s Financial Conduct Authority (FCA).

“It’s very challenging. It’s not only the exchange that you have to meet. You have to meet the FCA — it’s the financial regulator here,” he said. “Honestly, the takeaway is you have to learn how to play by the rules. Because you’ll be surprised how much pops up.”

He further stressed the importance of responsible journalism, saying misinformation — particularly in Nigeria — can complicate international due diligence exercises.

“When you do a due diligence on a company, everything that has been said about that company or the individuals pops up. And you have to defend it… But people don’t see that. So you go through a lot of that. And you have to debunk. You have to confirm. You have to explain.”

GTCO’s London listing: A West African first

GTCO’s secondary listing on the London Stock Exchange marks a significant step in its strategic global expansion. On July 9, the company announced the admission of its Ordinary Shares to the LSE’s main market, making it the first financial services institution in West Africa to dual-list shares on both the Nigerian and London exchanges.

The listing follows a fully marketed offering that raised $105 million through the issuance of 2.29 billion new ordinary shares, attracting a strong mix of long-term institutional investors.

The company’s shares are now trading under the ticker “GTHC”, with a planned shift to “GTCO” following the cancellation of its Global Depository Receipts (GDRs). The transition reflects GTCO’s current corporate structure and rebranding efforts.

GTCO’s listing comes at a time when Nigerian banks face steep regulatory demands and macroeconomic uncertainty. Yet, the firm’s ability to meet the LSE’s stringent standards — including anti-money laundering protocols, board composition rules, and audit transparency — suggests GTCO is positioning itself to attract more foreign capital and assert its footprint beyond Africa.

Agbaje’s remarks not only defend regulatory policies back home but also highlight the burden of perception that Nigerian companies must overcome on the global stage — especially in an era where public narrative largely influences investor confidence.