Geregu Power Plc’s profit before tax plunged by 79.9 percent to N7.55 billion in the nine months ended September 2026, as operational disruptions caused by failures in critical transformers sharply reduced electricity generation and revenue.
The decline from N37.46 billion recorded in the corresponding period of 2025 highlights the financial impact of equipment breakdowns at the power plant, which the company said significantly constrained its production capacity during the period.
In its unaudited financial statements, the electricity generation company reported revenue of N25.35 billion, representing an 80.7 percent decline from N131.47 billion in the same period last year.
The sharp contraction was driven by a fall in energy sales to N16.90 billion from N85.52 billion, while capacity charge revenue dropped to N8.46 billion from N45.94 billion.
Geregu Power attributed the revenue decline to the breakdown of three critical transformers immediately after the company’s handover, resulting in low-voltage winding failures, high-voltage bushing failures and other operational challenges.
According to the company, the transformer failures significantly affected production output, with the equipment essential to the plant’s operations requiring repairs.
The company disclosed that one transformer had been successfully repaired, restored and reconnected to the national grid in August, while two others remained under repair and were expected to return to the plant in November and December.
The temporary reduction in operational capacity directly affected electricity generation and revenue, although management said the disruption resulted from unforeseen equipment breakdowns rather than underlying business performance issues.
Geregu Power also disclosed an ongoing reconciliation with the Nigerian Independent System Operator (NISO) over an energy loss of 18,704.33 megawatt-hours (MWh) across August and September that was not captured by Nbet. The company said the amount would be recognised in due course.
The revenue contraction significantly weakened the company’s operating performance, with gross profit falling by 84.5 percent to N8.22 billion from N53 billion.
Cost of sales declined to N17.14 billion from N78.47 billion, reflecting lower operating activity, although the reduction was insufficient to offset the impact of weaker revenue.
Operating profit consequently fell to N12 billion from N42.23 billion in the corresponding period of 2025.
The company’s administrative expenses also increased substantially, rising to N17.08 billion from N7.34 billion, adding further pressure to earnings.
Despite the challenging operating environment, an improvement in impairment reversals provided some support to profitability. Geregu recorded an impairment reversal of N16.12 billion on financial assets, compared with an impairment loss of N4.74 billion in the prior-year period.
Finance costs declined to N9.39 billion from N10.07 billion, while finance income stood at N4.94 billion compared with N5.30 billion a year earlier.
Consequently, net finance costs narrowed to N4.46 billion from N4.77 billion.
Profit after tax declined by 76.5 percent to N5.89 billion from N25.10 billion, while earnings per share dropped to N2.36 from N10.04.
To address the operational disruptions, Geregu Power said its board had taken the bold step of ordering brand-new transformers from Siemens to guarantee uninterrupted power generation.
In a statement, the company disclosed that the agreement covers transformers for the plant’s three generating units, GT11, GT12 and GT13, and forms part of the electricity producer’s investment in maintaining and modernising critical infrastructure.
The procurement is expected to strengthen the reliability of the plant’s connection to Nigeria’s national grid by reducing the risk of transformer-related failures that could disrupt generation and electricity delivery.
“Under the agreement, Siemens Energy will handle the design, manufacture, testing and delivery of the three transformers, while Geregu Power will participate in Factory Acceptance Testing before the equipment is shipped to Nigeria.
“The testing process will allow the power producer to assess the equipment against agreed specifications before delivery and installation,” the company disclosed.
According to further analysis of the financial statement, the company expects the return of the two transformers undergoing repairs to enable the full restoration of its generation capacity.
The operational challenges also affected its cash generation. Net cash used in operating activities stood at N1.67 billion in the nine months, compared with positive cash generation of N54.61 billion in the corresponding period of 2025.
The company ended September with cash and cash equivalents of N23.97 billion, compared with N28.11 billion at the end of December 2025.
Its total assets stood at N245.16 billion, while total equity declined to N42.02 billion from N58.63 billion at the end of 2025.
Geregu closed its last trading day on Friday with N825.70 per share on the Nigerian Stock Exchange. Geregu Power began the year with a share price of N1,141.50 but has since lost 27.7 percent off that price valuation, ranking it 119th on the NGX in terms of year-to-date performance.
Chinwe Michael is a Nigerian business journalist and media professional with over 4 years of experience covering companies, financial markets, banking, fintech, economic policy, financial inclusion, and corporate affairs. She currently leads the Companies & Markets desk at BusinessDay, where she drives coverage of Nigeria’s corporate and capital markets, translates complex financial data into accessible stories, and mentors younger journalists. Prior to that, she was the head of the financial inclusion/fintech desk. With a background in banking and finance and extensive experience in media and communications, Michael has developed expertise in financial journalism, economic analysis, investigative reporting and market intelligence. Her work examines how monetary policy, corporate performance, capital flows, technology, and regulatory decisions affect businesses, investors, and households. She was selected from about 3,000 applicants as one of 20 journalists for Cohort 4 of the MTN Media Innovation Programme, gaining exposure to new approaches to journalism, technology, and media innovation. Her international journalism experience and engagement with professionals across Russia, Dubai, Saudi Arabia, and others in different sectors have further broadened her understanding of global communication and development.
