To shareholders of Nigerian Aviation Handling Company (NAHCO) Plc, they have every reason to aim for the sky. In the midst of global and national macroeconomic challenges, NAHCO has sustained resilient performance through its farsighted business model and ability to harness emerging opportunities.
The latest audited report and accounts of NAHCO, for the year ended December 31, 2024, released at the Nigerian Exchange (NGX), showed that the leading aviation ground handling company recorded well-rounded performance with both actual and underlying performance indicators at their highest levels.
The company is increasing dividend payout to shareholders by 134 per cent, riding on the back of record revenue and profitability.
Both the profit and loss accounts and the balance sheet indicated strong performance outlook. Total revenue rose by 88.5 per cent from N28.40 billion in 2023 to N53.54 billion in 2024. With increased top-line efficiency, gross profit doubled by 120.53 per cent to N33.08 billion in 2024 as against N15 billion in 2023. Operating profit also jumped by 123.93 per cent from N8.86 billion to N19.84 billion, underscoring the fact that the group’s performance was driven mainly by core business operations.
Handy Facts
Profit before tax doubled by 115.4 per cent to N18.70 billion in 2024 as against N8.68 billion in 2023. After taxes, net profit leapt by 132 per cent from N5.54 billion to N12.86 billion. Consequently, earnings per share rose by 132 per cent from N2.84 in 2023 to N6.60 in 2024, providing headroom for similar percentage increase in dividend payouts without undermining the group’s recent dividend payout trend.
The Dr Seinde Fadeni-led board of directors has recommended distribution of N11.58 billion as cash dividends to shareholders for the 2024 business year, more than a double of N4.95 billion distributed for the 2023 business year. Shareholders, who are expected to approve the dividend recommendation at their forthcoming annual general meeting, will receive a dividend per share of N5.94 for the 2024 business year compared with N2.54 paid for the 2023 business year, representing an increase of 133.9 per cent.
The dividend outlook underlined NAHCO as one of the most investors-friendly and most-sought after stocks at the Nigerian capital market. With current dividend yield in double digits, NAHCO has recorded capital gain of 175 per cent over the past 15 months, underscoring the strong positive investors’ sentiments that have shaped trading on the company’s shares. NAHCO’s share price, which started 2024 at N25.40 per share, opens this week at N69.90 per share, representing capital gain of 175.2 per cent.
Well-grounded
The positive operational performance over the years has continued to strengthen the group’s capacity for long-term sustainability. Total assets rode on the back of retained earnings to expand to N46.95 billion in 2024, as against N27.31 billion in 2023.
Shareholders’ funds rose by 65.5 per cent from N12.13 billion to N20.07 billion. Retained earnings had grown by 84.1 per cent from N9.40 billion in 2023 to N17.31 billion in 2024.
Underlying performance ratios showed that the actual face figures were grounded in expansive business growth and improvements in operating efficiency. All indices were positive in line with the actual face figures, showing a congruence that further strengthened the overall outlook of the group. Gross profit margin, which measures top-line efficiency, improved from 52.82 per cent in 2023 to 61.79 per cent in 2024.
Operating profit margin increased from 31.2 per cent in 2023 to 37.06 per cent. Pre-tax profit margin, which indicates the average profitability per unit of activity, expanded by nearly 500 basis points from 30.56 per cent in 2023 to 34.93 per cent in 2024. Return on total assets (ROA) increased from 31.8 per cent in 2023 to 39.8 per cent in 2024, underlining the improvement in asset utilization and efficiency. Return on equity (ROE) rose by more than 18 percentage points from 45.7 per cent in 2023 to 64.1 per cent in 2024, showing the substantial investors’ value creation potential of the group.
Broad and Sturdy
Segmental analysis showed a broad-based growth, powered by the engrained efficiency in overall business management. All the businesses of the group are growing and profitable, with its largest and best-known ground handling business providing a comfortable lead. Total revenue from the ground handling business doubled by 105 per cent from N17.86 billion in 2023 to N36.60 billion in 2024.
Segmental headline profit jumped by 146.1 per cent from N9.20 billion to N22.64 billion. Cargo business income rose by 38.7 per cent from N7.18 billion to N9.96 billion, with accompanying profit increasing by 59 per cent from N3.47 billion to N5.52 billion. Revenue from other businesses doubled by 108 per cent from N3.36 billion to N6.98 billion while related headline profit grew by 107 per cent from N1.77 billion in 2023 to N3.67 billion in 2024.
The NAHCO Group is a well-diversified conglomerate with interests in aviation ground handling, airport management, aviation training, free trade zone, commodities export, and energy solutions. In addition to its main ground handling business and cargo handling business, other subsidiaries included Mainland Cargo Options Limited, Nahco Free Trade Zone Limited, NAHCO Power Solutions Limited, NAHCO Management Services, NAHCO Travels & Hospitality Limited, NAHCO Aviation Academy and NAHCO Commodities Limited.
The latest results underscored the continuous brand dominance in the aviation services industry. NAHCO, in the past four months, have signed not less than five new ground handling contracts and renewals with many leading global airlines, while expanding its specialty.
In February 2025, NAHCO, in a first of its kind in the aviation industry, received Federal Government’s approval to handle shipments with radioactive contents in its facilities at the airports. The approval, jointly conveyed by the Nigerian Civil Aviation Authority (NCAA) and the Nigerian Nuclear Regulatory Authority (NNRA), directed “all importers and exporters of radioactive material” to “contact NAHCO for import and export of radioactive material”.
Group Managing Director, Nigerian Aviation Handling Company (Nahco aviance) Plc, Mr. Olumuyiwa Olumekun, said the approval was based on thorough assessment of the group’s facilities, including equipment and human resources, as well as the group’s compliance with global protocols and processes.
According to him, the company has put in place clear, diligent and thorough processes that would ensure 100 per cent compliance to procedures by highly – trained company professionals as they carry out the specialised functions.
Group Executive Director, Commercial and Business Development, Nigerian Aviation Handling Company (NAHCO) Plc, Prince Saheed Lasisi highlighted that the latest approval was a good development for importers and exporters who have been having challenges exporting and importing shipments with radioactive contents.
“NAHCO is solving all these issues for our clients, especially the big international airlines and international oil companies (IOCs) who require the approval granted NAHCO to move critical shipments which have radioactive contents in and out of the country,” Lasisi said.
Earlier, NAHCO had been selected by regional operators, Afrijet and Air Sierra Leone, to handle their ground operations in Nigeria. The contracts between the parties has seen NAHCO providing services for Afrijet’ flights into Port Harcourt and Lagos and Air Sierra Leone’s flights to Lagos. The contract with Afrijet was for a three-year period ending 2027 while Air Sierra Leone’s contract was for five years ending 2029.
NAHCO had also secured extension of groundling contracts with three leading international carriers, Emirates, Turkish and Virgin Atlantic. Emirates, which resumed schedule flight operations to Nigeria in October 2024, had previously appointed NAHCO to provide it with complete ground handling services. This arrangement would now be in place for the next five years.
British carrier, Virgin, has always pitched its tent with NAHCO because of its excellent service delivery while the company has always been the ground handlers of choice for Turkish Airlines, with long-standing contracts’ approvals and renewals.
Olumekun said the company’s expansion of existing businesses and focus on emerging opportunities would continue to drive growths in the years ahead.
According to him, with more than 45 years track record as the leader in ground handling service in Nigeria and the entire West Africa region, NAHCO would continue to invest in equipment and human capital to ensure optimal service delivery to clients and sustainable returns to shareholders.
Lasisi highlighted that expansions in the operations of the company reflected public trust in the brand.
According to him, any airline that provides the best service will depend on the groundhandler that provides the best service to keep its topflight position.
“It is a measure of the trust that the airlines have in us that they have extended our contracts with them. We are honoured with the trust reposed in us by our clients,” Lasisi said.
Future outlook
The latest results placed NAHCO in a strong start to achieve its five-year growth target of N300 revenue. Globally recognised as one of Africa’s leading ground handling service providers and with presence in all major Nigerian Airports, NAHCO plans to leverage its core business operations into strong positions across critical segments of the logistics value chain.
With the 2024’s total revenue of N53.54 billion already 39 per cent above the year’s projected revenue of N38.49 billion, the company has started its new five-year growth plan with great speed. The board of the company had unveiled a five-year growth plan during an interactive session with the investing public at the Nigerian Exchange (NGX) in December 2024.
Under the five-year strategic business plan, turnover was projected to rise successively to N38.49 billion in 2024, N71.12 billion in 2025, N101.93 billion in 2026, N146.07 billion in 2027, N209.34 billion in 2028 and N300 billion by 2029.
A breakdown of the N300 billion revenue target indicated that the group expected to generate N120 billion from the main ground handling business over the five-year period, N40 billion from cargo handling, N36 billion from NAHCO Logistics Services while NAHCO Free Zone, NAHCO Commodities, NAHCO Travel & Hospitality and NAHCO Aviation Academy would contribute N15 billion, N80 billion, N7 billion and N2 billion respectively.
Already, the 2024 results provided reasonable basis to assume that the group could surpass its five-year projection. For instance, at the 2024 rate, ground handling income could surpass N183 billion over the five-year period while cargo handling business could generate about N50 billion.
Chairman, Nigerian Aviation Handling Company (NAHCO) Plc, Dr Seinde Fadeni, has said the company has the potential to achieve its target of N300 billion revenue by the next five years given ongoing investments and numerous emerging opportunities.
According to him, the new five-year growth plan that would strengthen existing businesses and open up new opportunities, with key growth drivers aimed at further diversifying the group’s businesses within and outside Nigeria.
He said the group has demonstrated resilience over the years, citing significant growths in turnover and profitability.
For Fadeni, while recent dividends and capital gains rank highest in the history of the company and among the highest in the Nigerian capital market, this is the beginning of bumper returns to investors.
“As a company that has consistently paid high dividends over the years, NAHCO Plc will continue to seek higher dividends for its shareholders. To do that, the company has to increase profitability. To increase profitability, the company is making make huge investments in manpower and equipment,” Fadeni said.
He reiterated the company’s commitment to the ideal of good corporate governance and sustainable growth, assuring that the board would continue to provide the enablement for the management team to deliver the group’s strategic goals.
Group Executive Director, International Business and Corporate Services, Nigerian Aviation Handling Company (NAHCO) Plc, Dr. Sola Obabori outlined that the company would sustain progressive growths in sales and profitability over the next five years.
“We are embarking on a five-year transformation journey to build a new NAHCO, centered around four key pillars; accelerate growth in business, differentiate with operational excellence, lead with digital and deliver a transformed people and culture,” Obabori said.
He assured that the group is committed to achieving specific performance goals by 2029, while simultaneously expanding its service offerings.He said the projected growth trajectory compels the company to prioritize operational efficiency and performance improvement.
He added that NAHCO has consistently demonstrated its ability to capitalise on expanding markets through innovation and adaptation.
For investors and stakeholders, NAHCO appears to be on a remarkable journey of continuing excellent services and high returns. This optimism is underscored by the strong buy-side uptick for the shares of the company at the stock market. Between strong fundamentals and positive share pricing trend, it’s a double win for investors in NAHCO.
