THE CHANGING FACE OF NNPCL

The audited financial statements of NNPC Limited for 2025 reveal a significant transformation for Nigeria's national oil company. Once seen as opaque and inefficient, NNPC Limited has demonstrated improved operational performance, stronger earnings capacity, and a shift towards higher-quality revenue streams. The company's management has been commended for its transparency and openness with the media, analysts, and other stakeholders.

The headline financial performance of 2025 is impressive, with profit after tax increasing by 33% from ₦5.4 trillion to ₦7.2 trillion, earnings per share rising by 32% to ₦35.9, and net cash generated from operating activities growing by 16.5% from ₦11 trillion to ₦12.8 trillion. Despite a 24% decline in revenue, NNPC Limited managed to maintain strong profitability.

Key drivers of this improved performance include a significant decline in costs. Cost of sales fell by 24.6% from ₦33.36 trillion to ₦25.14 trillion, general and administrative expenses decreased by 27.6% from ₦3.58 trillion to ₦2.59 trillion, and selling and distribution expenses dropped by 93.5% from ₦145.7 billion to ₦33.1 billion. These cost reductions, coupled with a shift in revenue composition, have led to improved gross profit margins and overall earnings.

The 2025 accounts were independently audited by PricewaterhouseCoopers (PwC), which issued an unmodified audit opinion on both consolidated and separate financial statements. While the unmodified opinion does not certify that every aspect of the company's operations is efficient, it provides assurance that the financial statements fairly present the company's financial position and performance.

It is important to note that the total cost of ₦27.76 trillion mentioned in criticism should not be viewed as solely administrative overhead or discretionary expenditure. A significant portion of this cost represents cost of sales, which includes direct expenses associated with producing, purchasing, and selling oil, gas, and petroleum products.