First HoldCo Plc posts strong earnings growth in H1 2025

First HoldCo Plc has reported robust growth in its core business operations, with gross earnings rising 18.1 per cent year-on-year to N1.66 trillion for the half year ended June 30, 2025, according to the company’s unaudited financial results filed with the Nigerian Exchange Group on Wednesday.

The surge in earnings was primarily driven by a 51.7 per cent increase in interest income, which rose to N1.44 trillion from N947.7 billion in the same period last year. Net interest income also climbed sharply by 75.7 per cent to N904.8 billion, up from N514.9 billion.

However, the strong top-line growth was tempered by a 56.5 per cent drop in non-interest income, which fell to N189.4 billion from N435.7 billion a year earlier. Additionally, impairment charges nearly doubled, rising 99.4 per cent year-on-year to N185.4 billion.

Operating income stood at N1.09 trillion, a 15.1 per cent increase from N950.6 billion in H1 2024, while operating expenses rose 24 percent to N552.8 billion.

As a result of these cost pressures, profit before tax fell 13.6 per cent to N356.1 billion, while profit after tax dropped 20.7 per cent to N289.8 billion, compared to N365.3 billion in the corresponding period of 2024.

First HoldCo’s total assets grew by 2.5 percent year-to-date to N27.2 trillion, while customer deposits increased by 4.2 per cent to N17.9 trillion. Net customer loans and advances rose marginally by 1.1 per cent to N8.9 trillion.

The result showed that Post-tax return on average equity declined to 20.2 per cent (H1 2024: 36.9 per cent); Return on average assets stood at 2.2 per cent (H1 2024: 3.6 percent); Earnings yield improved to 16.5 percent (H1 2024: 14.1 percent); Net interest margin rose to 10.4 per cent (H1 2024: 7.7 per cent); Cost of funds decreased to 4.8 per cent (H1 2024: 5.2 per cent).

Further breakdown showed that Cost-to-income ratio rose to 50.5 per cent (H1 2024: 46.9 per cent); Non-performing loans (NPL) ratio increased to 12.9 per cent (Dec 2024: 10.2 percent); NPL coverage declined to 38.8 per cent from 54.8 per cent in December 2024; Capital adequacy ratio remained solid at 16.9 per cent (Dec 2024: 16.5 per cent).

According to the group, book value per share increased to N70.4 from N61.7 in the previous year, reflecting continued shareholder value growth.

Group Managing Director Adebowale (Wale) Oyedeji noted the company’s continued momentum in its interest-earning business, driven by strategic asset optimization and a favorable rate environment. However, he acknowledged the challenges posed by rising impairment costs and elevated operating expenses.

“We remain focused on delivering long-term value through disciplined execution and enhanced risk management,” Oyedeji said.

Despite near-term pressures on profit, analysts view First HoldCo’s strong balance sheet and expanding interest margins as indicators of resilient fundamentals in a challenging macroeconomic environment.

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