SCOA Nigeria Plc has reported a significant increase in its borrowings, reaching N12.017 billion in 2025. This figure comprises N11.043 billion in current borrowings and N974.32 million in non-current borrowings. This represents a substantial 115.2% increase from the N5.58 billion recorded in 2024.

The company's audited financial statement for the period ended December 31, 2025, filed with the Nigerian Exchange (NGX), indicates a high reliance on debt financing. Consequently, total liabilities surged by 108.4% year-on-year to N19.87 billion as of December 31, 2025, up from N9.56 billion in 2024.

A detailed breakdown of the company’s balance sheet reveals that current borrowings alone jumped 153.8% to N11.04 billion, an increase from N4.36 billion in the previous year. Furthermore, trade and other payables also rose sharply by 154.4% to N6.46 billion, suggesting higher supplier obligations and an increased reliance on credit to support day-to-day operations.

The surge in borrowings has significantly elevated SCOA’s debt-to-equity ratio, pointing to a more leveraged capital structure dominated by short-term financing. Despite this spike in debt, SCOA reported no finance costs in 2025, a notable contrast to the N4.01 million recorded in 2024. This could suggest the company benefited from favourable credit terms or capitalised borrowing costs.

The absence of interest expense provided a boost to earnings, helping to cushion the impact of declining revenue. Administrative expenses also declined by 8.5% to N1.34 billion, further supporting bottom-line growth.

Key financial highlights for 2025 compared to 2024 include:

• Revenue: N8.36 billion, down 38.4% YoY (N13.53 billion in 2024)
• Cost of Sales: N7.06 billion, down 42.9% YoY (N12.34 billion in 2024)
• Gross Profit: N1.30 billion, up 8.3% YoY (N1.19 billion in 2024)
• Distribution & Administrative Expenses: N1.34 billion, down 8.5% YoY (N1.46 billion in 2024)
• Finance Income: N42.48 million, up from N1.14 million in 2024
• Pretax Profit: N804.70 million, up 114.8% YoY (N374.40 million in 2024)
• Post-Tax Profit: N553.75 million, up 142.5% YoY (N228.81 million in 2024)
• Total Assets: N22.99 billion, up 91.1% YoY (N12.01 billion in 2024)
• Total Liabilities: N19.87 billion, up 108.4% YoY (N9.56 billion in 2024)
• Equity Attributable to Shareholders: N1.73 billion, up 51.9% YoY (N1.14 billion in 2024)
• Earnings per Share: 85kobo, up 142.9% YoY (35kobo in 2024)

Revenue dropped significantly by 38.4% to N8.36 billion from N13.53 billion in 2024, primarily driven by weaker performance across equipment sales and motor vehicle distribution segments. However, the cost of sales declined at a faster rate, falling 42.9% to N7.06 billion, which led to a modest 8.3% increase in gross profit to N1.30 billion.

The improved cost efficiency helped operating profit rise sharply, supporting an 114.8% increase in pre-tax profit to N804.7 million. Despite weaker topline figures, profit after tax rose by 142.5% to N553.75 million from N228.81 million in the previous year. This growth was largely driven by improved margins and reduced operating expenses.

Interestingly, SCOA’s share price has surged 219% year-to-date, rising from N7.10 to N22.65 as of April 8, making it the fifth best-performing stock on the NGX. This performance has occurred despite the company not paying dividends or issuing bonus shares for approximately 10 consecutive years.