Okomu Oil, one of Nigeria’s biggest palm oil makers, has seen its profit surge more than five times in the second quarter of the year on reduced cost pressures that have helped power a strong top-line growth.
According to the company’s unaudited financials, net profit grew to N25.79 billion in the quarter under review from N5.11 billion in the corresponding period last year. This is as the palm oil maker’s after-tax-profit on a year-on-year basis more than doubled to N67 billion.
Revenue increased by 125.7 percent as the firm’s top-line growth more than doubled to N71.7 billion in Q2. This is particularly powered by a sharp reduction in finance cost, which dropped to N546.6 million in the reviewed period, up from N2.9 billion last year, allowing for a ballooning net profit margin of 36 percent.
Okomu Oil is expected to grow its revenue base in 2025, supported by crude palm oil prices and a stable foreign exchange, according to a report by CardinalStone Research.
The firm, one of Nigeria’s largest agro-industrial players, recorded N130.21 billion as topline earnings in 2024. But the Edo-based palm oil maker will see total revenue rise to N176.7 billion this year.
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Okomu started 2025 with a 33.6 percent year-on-year increase in revenue to N58.1 billion in the first quarter, driven by improved internal efficiency and firmer local prices for crude palm oil.
Analysts say the rising crude palm oil (CPO) prices, projected to hit $1,200 metric tonne by year-end, may be a boon for the palm oil producers amid a stable macroeconomic environment, even as cost pressures and volatility still persist.
The notable reduction in cost comes amid a slowing inflationary trend in Africa’s most populous nation with prices cooling for three consecutive months to 22.2 percent in June 2025, according to the National Bureau of Statistics.
As inflation is tapering, the naira is also maintaining its run with projections of hitting N1400/$ by the end of the year. This will see firms like Okomu Oil that are exposed to FX have a noticeable drop in cost pressures while maintaining a strong top-line growth.
Profit before tax grew 458.9 percent to N35.3 billion in the three months to June, down from N5.6 billion in the prior period last year. This is as gross profit almost quadrupled to N44.3 billion.
On the balance sheet, total assets stood at N159.911 billion as of June 2025, reflecting a 36.63 percent increase over six months. Retained earnings rose further to N76.693 billion, up from N53.957 billion in December 2024.
What the H1 2025 results look like
For the six months to June 2025, Okomu Oil’s revenue surged by 73.1 percent to N129.83 billion down from N78 billion last year, reflecting improved product pricing, higher export volumes, and a weaker naira that boosted foreign exchange gains.
On the profit front, the net income more than doubled to N47.5 billion. This is as Earnings Per Share (EPS) soared by 135.4 percent to N49.83 in the first half of the year.
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Net General expenses grew at a much slower pace of 38 percent YoY. This moderate growth, likely aided by easing inflationary trends, led to a 12 basis points increase in EBIT margin to 52.7 percent.
Net finance costs increased slightly by 10 percent, owing to higher exchange losses compared to exchange gains for the period, on revaluation of supplier and customer balances.
However, the overall impact of FX movements was muted compared to the prior year, with both gains and losses tapering significantly, owing to the relative naira stability for the year so far.
The company has also declared a N30 interim dividend for H1’25.
As of market close on July 23, 2025, shares of Okomu Oil were priced at N930 with a year-to-date performance of 109.46 percent on the Nigerian bourse.
