Geregu Power Plc is under intense scrutiny after failing to meet obligations on its N40.09 billion Series 1 Senior Unsecured Bond. The company missed both the eighth semi-annual coupon payment and the fourth principal repayment, an incident confirmed by the FMDQ Securities Exchange which labeled the debt as being in credit default.
This financial setback follows a dramatic decline in the company’s fiscal performance during the first half of 2026. Profit after tax plummeted by 88% to N2.54 billion, down from N20.27 billion the previous year. Revenue also saw a steep drop, falling nearly 79% to N18.65 billion. The second quarter was particularly difficult, with revenue sinking to N419.1 million compared to N55.87 billion during the same period in 2025.
Management identifies a N61.47 billion turbine maintenance project as the primary driver behind these figures. While this overhaul is designed to enhance long-term plant reliability, it necessitated the removal of capacity, which hindered energy production and immediate cash flow. Despite the resulting liquidity issues, GCR Ratings maintained an A(NG) issuer rating with a stable outlook, anticipating a recovery once the maintenance concludes.
Market reaction has been negative, with Geregu Power shares shedding 27.67% of their value since the start of 2026. Investors are now awaiting updates on how the company plans to resolve the outstanding bond payments and whether the current earnings dip is merely a temporary byproduct of infrastructure upgrades.
