July 30, 2026/Cordros Report
C & I Leasing Plc (CILEASING) released its unaudited Q2-26 results today, reporting a 27.3% y/y decline in EPS to NGN0.16 (Q2-25: NGN0.22), translating to a 19.4% y/y drop in H1-26 EPS to NGN0.29 (H1-25: NGN0.36). The decline in EPS primarily reflects a sharp increase in the non-controlling interest share of profit, which compressed earnings attributable to owners of the parent. However, in nominal terms, group profit after tax rose by 1.3% y/y, supported by a 3.9% y/y expansion in gross earnings.
CILEASING’s gross earnings grew by 3.9% y/y in Q2-26 (H1-26: +8.5% y/y), driven by its core lease income (+9.4% y/y | 92.8% of gross earnings) and sustained net tracking income growth (+196.1% y/y | 0.5% of gross earnings), which together more than offset softer net outsourcing income (-10.5% y/y | 2.9% of gross earnings) and other operating income (-25.3% y/y | 2.3% of gross earnings). We attribute the topline growth to sustained demand and higher fleet utilisation within the core lease business, alongside stronger uptake of tracking services, which more than compensated for weaker outsourcing and other operating income.
By geography, Nigeria continued to underpin group performance, with gross earnings rising by 49.1% y/y (60.6% of total gross earnings). Meanwhile, Ghana and the United Arab Emirates reported declines of 4.5% y/y and 12.5% y/y, respectively, contributing 27.8% and 11.5% of group gross earnings. On a quarter-on-quarter basis, gross earnings advanced by 2.5%.
Meanwhile, EBIT and EBITDA margins contracted by 280bps y/y and 327bps y/y to 31.0% and 50.1%, respectively (H1-26: -60bps y/y and -12ppts y/y to 30.2% and 49.8%, respectively). The compression reflects a 14.5% y/y increase in operating expenses (H1-26: +12.2% y/y), reflecting higher personnel expenses (+33.1% y/y).
Below the operating line, finance costs contracted by 12.3% y/y to NGN3.40 billion in Q2-26, reflecting a 20.9% y/y decline in finance lease interest to NGN1.79 billion and a 25.1% y/y decline in commercial notes interest to NGN0.88 billion which more than offset the 66.6% y/y increase in term loan interest to NGN0.72 billion. For H1-26, however, finance costs increased by 2.3% y/y to NGN7.13 billion, driven by a 43.9% y/y increase in term loan interest to NGN1.38 billion.
Finally, profit before tax (PBT) increased by 12.9% y/y in Q2-26, while group profit after tax (PAT) rose by 1.3% y/y to NGN657.37 million, reflecting a higher effective tax rate of 18.6% (Q2-25: 9.3%). For H1-26, PBT and PAT grew by 11.4% y/y and 7.0% y/y to NGN1.34 billion and NGN1.16 billion, respectively.
Comment: CILEASING delivered a resilient Q2-26 performance, with modest gross earnings growth and lower finance costs translating into double-digit PBT growth and a modest increase in profit after tax. Nevertheless, underlying operating pressures persist, as reflected in margin compression driven by higher operating expenses. Looking ahead, we expect the core leasing business to remain the primary driver of gross earnings growth, However, a meaningful improvement in profitability will depend on the group’s ability to rein in operating expenses, particularly personnel costs, while maintaining lower funding costs through continued balance sheet deleveraging. In addition, the earnings contribution from the group’s non-wholly owned subsidiaries will remain an important determinant of earnings attributable to shareholders. Our estimates are currently under review.
