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Presco Plc reported a 7.3% year-on-year decline in net profit for the first half of 2026, as sharp revenue contraction in its Ghanaian operations and higher operational overheads offset double-digit growth in its core Nigerian market.

Profit after tax fell to ₦82.3 billion for the six months through June 30, down from the prior-year period. Earnings Per Share (EPS) dropped at a steeper rate of 20.5% year-on-year to ₦70.52, impacted by an expansion in the weighted average number of outstanding shares following recent capital updates.

Despite the earnings moderation, the board of directors proposed an interim dividend of ₦10.00 per share, representing a payout ratio of 14.2% based on H1 2026 earnings.

Geographic Divergence and Operational Pressures

Group revenue came in flat at ₦198.8 billion as performance split sharply across geographic territories:

• Nigerian Market: Domestic sales rose 12.4% year-on-year, backed by steady demand for refined palm oil and industrial crude palm oil (CPO) products.

• Ghanaian Market: Revenue dropped 34.7% year-on-year to ₦34.1 billion, severely curbing overall top-line expansion.

Operating expenses (OPEX) rose 16.5% to ₦42.8 billion, driven by a 74.4% surge in selling and distribution expenses and a 14.5% rise in staff costs. Higher production and depreciation expenses widened the cost of sales by 5.5% to ₦32.9 billion, trimming gross margins to 83.4%.

While miscellaneous operating income rose 57.9% to ₦5.1 billion, Operating Profit (EBIT) margin compressed by 1.7 percentage points to 63.6%.

Balance Sheet Deleveraging and Q2 Weakness

A key positive contribution during the half-year period came from the company’s financial structure. Net finance costs fell 76.3% year-on-year to ₦4.3 billion, driven by a 31.9% reduction in borrowing…