Femi Otedola’s Geregu Power sets milestone with audited results as market cap hits $1 billion

Geregu Power Plc, a leading power-generating company controlled by Nigerian billionaire, Femi Otedola, has set a milestone in the Nigerian Exchange (NGX) by being the first publicly listed company to release its 2022 audited financial report.

The timely release of Geregu Power’s audited results is a clear indication of the group’s dedication to financial transparency and accountability, further solidifying its status as one of Nigeria’s premier power-generating companies.

The report, which was audited by PwC, one of the world’s largest accounting firms, received positive reactions from both institutional and retail investors, causing the company’s shares to skyrocket by 10 percent during today’s trading session on NGX.

This boosted the company’s market capitalization beyond the $1-billion milestone.

According to analysis from an Investment Banker at a tier-one bank in Lagos, the value of Geregu shares is expected to soar beyond N800 ($1.73) per share in the near future. The optimistic forecast is based on the company’s recent shortlisting for the acquisition of the Geregu II power station, a highly sought-after 507-megawatt natural gas facility located in Kogi State, Nigeria.

The result underscores the company’s impressive resilience and ability to remain successful in spite of numerous challenges and obstacles, including malicious acts of vandalism on its gas pipelines, in its operating environment.

Despite the setbacks and disruptions that caused a decline in its revenue from N70.96 billion ($154.1 million) in 2021 to N47.62 billion ($103.4 million), Geregu was able to achieve a profit of N10.17 billion ($22 million) through the implementation of innovative solutions, proactive risk management, and close collaboration with relevant authorities and stakeholders, allowing it to maintain its competitive edge in the industry.

Its resilient financial performance in 2022 resulted in a significant improvement of total assets from N114.82 billion ($250 million) to N174.03 billion ($378 million), and an even more pronounced increase of cash and cash equivalents from less than N4 billion ($8.7 million) to N51.63 billion ($112.1 million).

The end-of-year profits translated into impressive earnings per share of N4.07 ($0.0088) for the group’s 2.5 billion outstanding shares, leading the board to confidently recommend a N8 ($0.174) per share dividend to be paid to shareholders on Jan. 30. This substantial dividend payment is expected to generate millions of dollars in dividend earnings for the majority shareholder, Femi Otedola, from his stake in the leading power-generating company.

Following the release of Geregu Power’s audited financial results, the company’s stock price saw a significant rise of 10 percent on the local exchange, driving the price per share toward N200 ($0.434). This remarkable 93.6-percent gain for investors who purchased shares in the company since its listing on the NGX on Oct. 5, 2022 is a testament to the company’s financial stability and growth potential.

As a foremost player in Nigeria’s energy sector, Geregu Power is majority-owned by Otedola. The company boasts an impressive portfolio of three natural gas-fired power plants with a total installed capacity of 435 MW, representing a significant 10 percent of Nigeria’s overall energy generation.

In pursuit of his vision to become the leading provider of integrated power in the region, Otedola made a strategic decision in 2019 to sell his majority stake in Forte Oil Plc and invest in the power industry in Nigeria through the acquisition of a majority stake in Geregu Power.

The move was driven by his unwavering faith in the power reforms of the federal government and a commitment to the growth and development of Nigeria’s energy sector.