Ellah Lakes posts N3.86 billion loss as core shareholders offload shares

Ellah Lakes Plc reported a net loss of N3.86 billion for the financial year ended December 31, 2025, deepening its losses compared to N729.34 million recorded in 2024, as rising operating costs outweighed gains from new revenue streams.

This is according to the company’s financial results for the period ended December 31, 2025, showing persistent financial strain despite its milestone commercial revenue from crude palm oil production in 2025.

This growth has yet to translate into profitability, as rising costs, aborted capital-raising efforts, and restructuring expenses continue to weigh heavily on its bottom line.

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At the same time, major shareholders and directors significantly reduced their stakes, raising questions about confidence in the company’s near-term outlook.

**Key financial highlights (2025 vs 2024): **

• Revenue: N146.66 million vs N780mn in 2024
• Loss before tax: N3.84 billion vs N893.94 million
• Loss after tax: N3.86 billion vs N729.34 million
• Gross Profit: N30.06 million vs N780mn in 2024
• Operating Loss: N3.84 billion vs N893.94 million
• Total Assets: N28.26 billion vs N24.55 billion in 2024
• Total Liabilities: N7.83 billion vs N2.70 billion in 2024
• Finance Costs: Reduced to N68.02mn from N147.62mn in 2024

**Drivers of mounting losses: **

The company’s worsening financial performance in the 17-month period is largely attributed to elevated operating expenses, including personnel and administrative costs, which outpaced revenue growth.

• Operating losses rose sharply to N3.84 billion, up from N893.94 million
• Personnel cost jumped to N1.2 billion in the 17 months of 2025, up from N591.451 million in 12 months of 2024.
• Administrative costs also jumped to N1.094 billion from N242.907 million.
• Operating loss before aborted offer costs, which stood at N2.5 billion as against N838.203 million in 2024 driven by N1.70 billion expense linked to an aborted public offer.
• Despite the commencement of palm oil production, the scale of operations remains insufficient to absorb these costs.

The failed capital raise not only resulted in direct costs but also forced the company to reclassify subscription funds as liabilities, further straining its financial position.

Additionally, the recognition of biological assets introduced new accounting losses, while continued restructuring efforts and investment in long-term agricultural assets increased depreciation and overheads.

These combined factors have entrenched the company in a loss-making position for the 17-month review period.

**Balance sheet pressures and capital structure: **

Ellah Lakes’ balance sheet reflects aggressive investment alongside rising financial obligations. Total assets increased to N28.26 billion at the group level, driven by heavy spending on property, plant, equipment, and plantation development.

• However, this expansion has been accompanied by a sharp rise in liabilities, which climbed to N7.83 billion, largely due to borrowings and related party payables tied to the failed public offer.
• Notably, related party obligations of N7.07 billion represent a significant financial overhang.
• Equity weakened during the period, declining to N20.43 billion as accumulated losses eroded retained earnings, now in a deficit position of N7.84 billion.
• While fresh capital injections boosted share capital and premium but were insufficient to offset the impact of sustained losses.

The company faces a delicate balancing act; scaling its operations to unlock value from its asset base while managing debt obligations and restoring investor confidence amid ongoing shareholder exits.

**Market reaction: **

The market is yet to react to the earnings release, as the market proceeded for the Easter holiday on Friday after the announcement.

• On Thursday, April 2, 2026, the stock closed at N12 per share on the NGX after recording a 0.4% gain over its previous closing price of N11.95.
• The stock began the year with a share price of N13.40 but has since lost 10.5% off that price valuation after news of its botched Initial Public Offer (IPO).

With 3.86 billion shares outstanding valued at N46.3 billion, Ellah Lakes is currently the 73rd most valuable stock on the NGX, about 0.036% of the equity market value.

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