Oando PLC just posted a set of half-year numbers that look like they belong to two different companies at the same time. Gross profit exploded 331% to ₦101 billion, revenue climbed 20% past the ₦2 trillion mark, and the upstream business pumped 16% more oil and gas.
On the surface, the turnaround from a ₦159 billion operating loss to a ₦128 billion operating profit reads like one of the strongest reversals in recent Nigerian corporate history. Yet the bottom line tells a more complicated story that you need to understand.
Profit after tax only grew 8% to ₦68.6 billion, and the company still posted a pre-tax loss of ₦32.8 billion for the period. The gap between the dramatic operating headline and the modest final figure holds a lesson about how debt reshapes everything.
Oando’s ₦101 billion gross profit marks a dramatic operational shift
The energy group’s gross profit surged from ₦23 billion to ₦101 billion in the six months ended June 30, 2026, according to Oando’s unaudited results filed with the NGX. The gross margin improved from 1.36% in H1 2025 to 4.90% in the current period, the filing showed.
Production averaged 42,789 barrels of oil equivalent per day, up from 36,836 boepd a year earlier, driven by new wells and restored shut-in capacity. At the same time, production operating costs fell 18% to $16.83 per barrel, reflecting tighter logistics and service contracts across the portfolio.
Revenue reached ₦2.06 trillion, with crude oil liftings rising 14% and gas sales volumes jumping 31% to 25.12 billion standard cubic feet. The trading arm handled 13.15 million barrels across 23 cargoes, up from 12.88 million barrels across 14 cargoes in the prior period.
How a single acquisition reshaped Oando’s entire upstream business
The performance traces directly to Oando’s acquisition of Eni’s former NAOC onshore joint venture assets, a deal valued at roughly $800 million that closed in 2024, the African Energy Chamber confirmed. That transaction handed Oando 40% working interests in Oil Mining Leases 60 through 63 across the Niger Delta.
Production from OMLs 60 through 63 alone averaged 40,077 boepd in H1 2026, up 18% from 33,947 boepd a year earlier. Facility uptime across the operated portfolio improved to 92% from roughly 85%, and the company recorded zero lost-time injuries during the period.
Speaking broadly about the structural shift in Nigeria’s upstream sector, NJ Ayuk, Executive Chairman of the African Energy Chamber, noted that Nigerian indigenous operators have taken on billions of dollars in assets and are now actively managing and growing them, the Chamber said. He described the shift as fundamental to how Africa’s largest oil producer now operates.
Oando’s ₦2.70 trillion debt devours the operating profit
The elephant in the room sits in the finance section of the income statement, where net finance costs hit ₦161.3 billion during the half. That figure represents 126% of the company’s ₦127.8 billion operating profit, Nairametrics analyst Idika Aja noted, meaning the entire operating profit was effectively absorbed before reaching the tax line.
“The first half of 2026 marks an important inflection point in Oando’s journey. Over the past two years, our priority has been to successfully integrate one of the most significant upstream acquisitions in Africa and unlock the full value of our expanded portfolio.” — Wale Tinubu CON, Group Chief Executive, Oando PLC, in the company’s H1 2026 results release
Interest payments of ₦98.9 billion consumed 55% of the ₦179.5 billion in cash generated from operations, the company’s own filing disclosed. Total borrowings stood at ₦2.70 trillion as of June 30, 2026, unchanged from December 2025 because new drawdowns offset scheduled repayments.
The balance sheet remained in negative equity territory at minus ₦530.4 billion, though that narrowed from minus ₦566.9 billion at year-end 2025. Economy Post reported that the company slipped into technical insolvency in FY2025, with total liabilities of ₦8.01 trillion exceeding total assets of ₦7.45 trillion at year-end.
Oando’s 100,000 boepd target rests on a ₦200 billion gamble
Tinubu pointed to an identified inventory of 62 development wells and 55 planned well interventions as the pathway toward a medium-term production target of approximately 100,000 boepd. The seven-well drilling program for 2026 is already underway, with two wells drilled and two more currently being drilled across OMLs 60 through 63.
The company is pursuing a ₦200 billion rights issue, currently under regulatory review by the Securities and Exchange Commission and the NGX. A separate multi-instrument issuance program worth up to $1.5 billion is also being advanced, with updated documentation expected in Q3 2026.
Key numbers from Oando’s H1 2026 results
- Revenue: ₦2.06 trillion, up 20% from ₦1.72 trillion in H1 2025
- Gross profit: ₦101 billion, up 331% from ₦23 billion in H1 2025
- Operating profit: ₦127.8 billion versus an operating loss of ₦158.7 billion
- Profit after tax: ₦68.6 billion, up 8% from ₦63.3 billion
- EPS: ₦8 per share, up 60% from ₦5 per share
- Cash and equivalents: ₦544.9 billion, up 181% year-on-year
- Total borrowings: ₦2.70 trillion, flat from December 2025
- Source: Oando PLC H1 2026 unaudited results, filed with NGX on August 4, 2026
DLM Capital Group research analyst Qudus Adebara noted in a review of Oando’s FY2025 results that the company delivered a mixed and highly volatile performance during that period, Simply Wall St reported. Analyst recommendations remain split, with some firms issuing buy ratings while others recommend selling the stock.
Whether this half-year surge in gross profit marks the start of a sustainable earnings trajectory or simply a cost-driven windfall will depend on how quickly the rights issue closes and how effectively the company reduces its crushing debt service burden heading into 2027.
