NAHCO Plc, Nigeria's leading ground handling company, posted a profit before tax of N14.4 billion for the first half of 2026, a 35% increase from N10.7 billion in the same period last year, according to its unaudited financial statements. The strong performance, fueled by a surge in cargo volumes and improved operational efficiency, has reinforced expectations of a higher dividend payout for the year.
Revenue Growth and Operational Highlights
The company's gross revenue climbed to N62.5 billion, up 28% from N48.8 billion in H1 2025. The growth was primarily driven by the aviation cargo segment, which saw a 40% increase in tonnage handled, reflecting Nigeria's expanding non-oil exports. Passenger handling also rose by 15% as domestic airlines resumed full capacity.
According to the company's Chief Financial Officer, Adebayo Ogunlesi, "The first half results demonstrate our ability to leverage operational efficiencies and capitalize on the rebound in air travel and trade. We remain focused on cost optimization and service expansion."
Profitability and Margin Expansion
Profit after tax stood at N9.8 billion, up from N7.4 billion in the prior year, while earnings per share rose to N0.97 from N0.73. Operating margin improved to 28% from 24%, driven by lower fuel costs and enhanced equipment utilization.
Analysts at Vetiva Research noted that NAHCO's cost-to-income ratio dropped to 72% from 76%, attributing the improvement to the company's investment in automated cargo systems and staff training.
Dividend Outlook Strengthens
The robust H1 performance has prompted the board to signal a potential interim dividend, a move that would mark the first in three years. The company's dividend policy targets a payout ratio of 30-40% of profit after tax, which could translate to an interim dividend of N0.29 per share, based on current earnings.
"Given the strong cash generation and positive outlook, we are confident in sustaining shareholder returns," said Managing Director, Olumide Adeosun, in a statement. "We are evaluating an interim dividend declaration at the next board meeting."
Strategic Investments and Future Plans
NAHCO has earmarked N25 billion for capital expenditure in 2026, focusing on expanding its cargo handling capacity at Lagos and Abuja airports. The company also plans to launch a new cold chain storage facility to tap into the growing demand for perishable goods logistics.
The company's balance sheet remains solid, with total assets rising to N185 billion and cash reserves of N22 billion, providing ample liquidity for expansion and dividend payments.
Industry Context and Market Response
The results come amid a challenging macroeconomic environment, with high inflation and currency volatility. However, NAHCO's dollar-denominated revenues from international airlines have provided a natural hedge, supporting profitability.
Market analysts expect the stock to react positively, with some projecting a 12-month target price of N45, up from the current N38. The company's shares have gained 12% year-to-date, outperforming the Nigerian Exchange's All-Share Index.
Conclusion
NAHCO's H1 2026 results underscore its resilience and strategic positioning in the aviation value chain. With strong revenue growth, margin expansion, and a clear dividend trajectory, the company is poised to deliver sustained value to shareholders.
