{"id":154190,"date":"2025-09-19T11:00:09","date_gmt":"2025-09-19T11:00:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/154190\/"},"modified":"2025-09-19T11:00:09","modified_gmt":"2025-09-19T11:00:09","slug":"nigerias-first-listed-internet-provider-posts-profit-but-burns-cash","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/154190\/","title":{"rendered":"Nigeria\u2019s first listed internet provider posts profit but burns cash"},"content":{"rendered":"

Legend Internet Plc, Nigeria\u2019s first publicly listed internet service provider (ISP), posted<\/a> higher annual profits in 2025 even as rising costs and liquidity pressures weighed on its balance sheet.<\/p>\n

For the year ended July 31, revenue rose 4% to \u20a61.19 billion ($799,000), while gross profit climbed to \u20a6761.4 million ($511,000) from \u20a6677.4 million ($455,464) a year earlier. Profit after tax surged 44% to \u20a6172.7 million ($116,000), helped by tighter cost controls. Earnings per share increased to 9 kobo from 6 kobo in 2024.<\/p>\n

Legend\u2019s IPO earlier this year<\/a> gave investors rare access to the sector. Still, the company\u2019s dependence on short-term borrowing, surging personnel costs, and negative cash flows underscores the difficulties of scaling connectivity in one of Africa\u2019s most competitive telecom landscapes.<\/p>\n

The headline numbers mask volatility. In the third quarter, profit after tax dropped<\/a> by more than half to \u20a632.9 million ($22,085), while operating expenses nearly tripled to \u20a6122.6 million ($82,329), driven by higher staff, consultancy, and marketing costs. Earnings per share fell to 2 kobo from 7 kobo a year earlier.<\/p>\n

Legend rebounded in the final quarter, however, closing the year with stronger margins. Analysts suggest this rebound stemmed from tighter cost-of-sales management, which kept gross margins stable despite lower quarterly revenues.<\/p>\n

The bigger challenge lies in liquidity. Net cash from operations swung to a negative \u20a672.6 million ($48,000) in 2025, compared to positive flows a year earlier. By July, cash balances had shrunk to \u20a621 million ($14,000), with an overdraft of \u20a649 million ($33,000). The company leaned on short-term borrowings, adding \u20a650 million in loans by April, while total short-term liabilities climbed to \u20a6464.8 million ($312,574). Legend reported no long-term debt.<\/p>\n

Operating and administrative expenses added to the strain, rising 52% to \u20a6560.2 million ($376,366), with personnel costs more than doubling to \u20a6195.9 million ($131,682). The savings on cost of sales, which dropped 7% to \u20a6429.7 million (288,531), were not enough to offset higher overheads. Earnings before interest and tax fell 39% to \u20a6172.7 million ($115,966), showing that rising finance and administrative costs continue to erode margins.<\/p>\n

Total assets edged up to \u20a63.34 billion ($2.24 million) from \u20a63.03 billion ($2.03 million) in 2024, with fibre infrastructure valued at more than \u20a62.6 billion ($1.7 million). Shareholders\u2019 funds stood at \u20a62.87 billion ($1.9 million), only slightly below last year\u2019s level, while retained earnings increased to \u20a6734.6 million ($493,527). Legend reported no asset impairments or pledges, and reaffirmed its commitment to stable pricing despite inflation running above 33%.<\/p>\n

The company\u2019s improved profit is a step forward, but without stronger cash generation and tighter cost discipline, that progress may prove fragile. For Legend, the real test is whether it can balance growth with stability in a market where infrastructure is expensive, competition is fierce, and liquidity can dry up quickly.<\/p>\n

Exchange rate= \u20a6 1,492.31<\/p>\n

Mark your calendars! Moonshot by TechCabal is back in Lagos on October 15\u201316! Meet and learn from Africa\u2019s top founders, creatives & tech leaders for 2 days of keynotes, mixers & future-forward ideas. Get your tickets now:\u00a0moonshot.techcabal.com<\/a><\/p>\n

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