The company’s unaudited third-quarter financial statements show that bank overdrafts rose to N64.80 billion at September 30, 2026, from N54.90 billion at the end of December 2025, adding approximately N9.9 billion to its outstanding borrowings.
The increase comes with a substantial financing burden, as Conoil disclosed that its overdrafts attract an average effective interest rate of 32 per cent annually, with the facilities repayable on demand.
Consequently, finance costs climbed to N12.99 billion during the nine-month period, compared with N4.76 billion in the corresponding period of 2025, representing an increase of approximately 173 per cent.
The rising cost of borrowing is becoming particularly significant when measured against the company’s cash generation.
Conoil generated N274.81 million in net cash from operating activities during the nine months, while interest payments amounted to N12.99 billion. This indicates a substantial mismatch between cash generated from its operations and the cost of servicing its borrowings.
The company’s working-capital position also reflects growing pressure. Trade and other receivables increased to N113.85 billion from N90.59 billion at the end of 2025, while cash and bank balances declined to N9.09 billion from N12.91 billion.
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Conoil attributed its worsening negative cash position partly to increased investment in inventory and efforts to drive sales through credit transactions.
Its net negative cash and cash equivalents position consequently deteriorated to N55.71 billion at September 2026, compared with N41.99 billion at the end of December 2025.
Despite the financing pressure, the company recorded improvements in some operating and earnings indicators.
Revenue rose to N280.12 billion during the nine months, while profit after tax stood at N5.31 billion, compared with N900.42 million in the corresponding period of 2025, according to the statement of profit or loss.
However, the third-quarter performance presented a different picture, with profit after tax declining to N152.81 million from N608.36 million in the corresponding quarter of 2025.
The figures highlight the financial implications of Conoil’s dependence on short-term bank financing in an environment where borrowing costs remain elevated.
Unlike companies with access to cheaper development finance, foreign-currency facilities or parent-company funding, Conoil’s disclosed borrowing structure leaves it exposed to the cost of domestic bank credit.
The challenge for the petroleum marketer will be managing its working-capital requirements, improving cash collections and reducing its dependence on expensive overdrafts without undermining its sales and distribution operations.
