Nigerian Companies Sink Into Large Debts as BUA Foods, 7 Others End 2024 With N8.67trn Liabilities

• The macro-economic environment seems to be worsening for Nigerian companies, with increased operating costs, loan interest among others
• Several companies ended the year with increased debts in the form of loan obligations among others
• One of these companies had a 165% growth in debts, despite what many had described as a successful year

Legit.ng journalist Ruth Okwumbu-Imafidon has over a decade of experience in business reporting across digital and mainstream media.

As economic experts continue to discuss how harsh the Nigerian business terrain is, the evidence is becoming more obvious with listed companies seeing a rise in debt levels.

Eight companies listed on the Nigerian Stock Exchange have seen a significant rise in their debts, with current and non-current liabilities now amounting to N8.67 trillion across all eight companies.

This includes debt obligations to be paid within the financial year – current liabilities – and the long-term debts that are not due anytime soon – non-current liabilities.

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OANDO Plc debts rise

Data gathered from the 2024 financial statements filed with the Nigerian Exchange (NGX) shows that Oando Plc has seen its total liabilities almost triple within one financial year.

The PUNCH reports that the numbers grew from N2.94 trillion to N7.78 trillion within a year, marking a 165% increase.

Current liabilities account for the bulk of this debt, with N6.56 trillion owed in trade payables and loans.

The remaining N1.22 trillion is made of non-current liabilities like retirement benefit obligations, deferred income tax liabilities, decommissioning provisions, and even more borrowings.

Bua Foods Plc. also has debts

Though Bua Foods plc still has a huge debt liability, its debts have reduced significantly within the financial year in review.

From N808.38 billion at the end of the 2023 financial year, Bua Food plc now has N618 billion total liabilities at the end of the 2024 financial year.

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This marks a 23.5% decline in total liabilities and could mean that the company is improving its finances with the new corporate strategy deployed.

Honeywell Flour Mills' debt increase as it delists

Honeywell Flour Mills had a busy year, especially with the acquisition by Flour Mills of Nigeria plc.

In the same 2024 financial year, Honeywell's total liabilities grew by 8%. From closing the 2023 financial year with N126.11 billion in total liabilities, Honeywell closed 2024 with N136.21 billion in liabilities.

Caverton, SCOAN, ABC

Caverton Offshore ended the 2024 financial year with N104.5 billion in total liabilities, 30% up from the N80.07 billion in the previous year.

The biggest portion of this is the current liabilities of N77.47 billion, while the non-current liabilities mostly made up of interest-bearing loans and lease liabilities account for N27.03 billion.

SCOA Nigeria has liabilities of N12.89 billion at the end of the 2024 financial year, a marginal increase from N12.02 billion the previous year. Its liabilities mostly come from its tax obligations and other financial obligations.

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For ABC Transport, the company recorded almost 29% growth in liabilities, going from N4.82 billion in 2023 to N6.21 billion in 2024. Of this figure, loans and borrowings account for more than a third, with about N2.72 billion.

Triple Gee has just N5.6 billion in total liabilities, but this is also a 29% increase year on year from N4.36 billion in 2023.

Learn Africa Plc only has N2.08 billion in liabilities, but this is about 66% up from the N1.25 billion recorded the previous year.

Oando acquires Agip

Recall that Oando PLC recently completed the acquisition of Nigerian Agip Oil Company (NAOC) from Eni, after ten years.

This transaction will strengthen Oando’s dream of upscaling its upstream operations and strengthen its position in the Nigerian oil and gas sector.

While making the announcement, CEO Wale Tinubu expressed his excitement that the deal is completed and shared several benefits the deal will bring to the sector.

Source: Legit.ng