Conoil proposes N2 dividend as shareholders await December payout

Conoil shareholders have endured significant losses over the past few years. Despite a substantial surge in 2024, the stock value plummeted 51.7% in 2025, leaving investors with a paltry 0.95% gross yield. Recent earnings improvements suggest Conoil could potentially increase its dividend for the 2026 financial year. With earnings projected to reach N7.87 per share in full-year 2026, a N3.50 dividend would represent a more sustainable 44.5% payout ratio compared to the recent N2.00 dividend.

However, Conoil's cash flow challenges persist, with only N275 million in net cash flow from operations in the first nine months of 2026. Restoring the dividend would require collecting outstanding receivables more efficiently, as current receivables amount to N23.35 billion. By tightening payment terms and aggressively pursuing overdue customer payments, Conoil could generate an additional N2.43 billion to fund the dividend without resorting to expensive borrowing.

If successful, restoring the N3.50 dividend would significantly boost shareholder returns, increasing the yield to 1.67% from the current 0.95%. While the recovery is still far from the pre-2025 levels, addressing cash flow issues and restoring the dividend would provide shareholders with a meaningful share of Conoil's recovery.