From FX Woes to Profit Surge: Nigerian Enterprises Stage Remarkable Rebound Post-Devaluation

The aftermath was a precipitous and sustained decline of the local currency, as the naira plummeted from approximately N460/$ in June 2023 to N1,535/$ by the close of 2024.

 

This abrupt devaluation subjected Nigerian corporations to colossal FX translation losses and escalating interest liabilities, undermining shareholder value across the NGX.

 

The distress was pervasive, yet acutely felt within the consumer goods and ICT sectors, where firms were heavily reliant on imported raw materials or saddled with considerable foreign-denominated debt.

 

Nonetheless, by late 2024, the tides began to turn. The foreign exchange market exhibited signs of stabilization.

 

By the first quarter of 2025, a semblance of tranquility had returned to the naira, now trading within a more predictable range. Enhanced FX liquidity, coupled with strengthened pricing power and cost-reduction strategies, enabled numerous companies to return to profitability.

 

By the conclusion of 2024, seven major listed consumer firms — BUA Foods, Cadbury Nigeria, International Breweries, Nigerian Breweries, NASCON Allied Industries, Dangote Sugar, and Nestlé Nigeria — reported a collective pre-tax loss of N507.57 billion, up from N359 billion in 2023.

 

Over the two-year span, these enterprises collectively lost N867 billion, due to foreign exchange exposure and burgeoning interest expenses.

 

Remarkably, only BUA Foods and NASCON remained profitable throughout the two-year period, underscoring the breadth of the damage.

 

FX losses for the group surged by 56% year-on-year, reaching N1 trillion in 2024, compared to N710 billion in 2023.

Finance costs more than doubled, escalating by 131% to N365 billion in 2024, up from N158 billion the previous year.

The telecommunications and ICT sector was not immune. MTN Nigeria, one of the largest entities on the NGX, also endured a significant blow.

 

The company reported a staggering N550 billion pre-tax loss in 2024, following a N178 billion loss in 2023.

 

MTN Nigeria attributed the dismal performance to the sharp devaluation of the naira, which directly impacted its foreign-denominated liabilities, notably tower lease obligations and other infrastructure-related contracts.

 

“In the foreign exchange market, the naira depreciated to N1,535/US$ by the end of 2024 (from N907.1/US$ on 31 December 2023), as businesses and consumers continued to grapple with escalating costs. These headwinds significantly impacted MTN Nigeria’s costs, particularly those related to tower leases and other foreign currency obligations,” stated Karl Toriola, CEO of MTN Nigeria.

 

MTN Nigeria reported N1.67 trillion in FX losses, with N926 billion recorded in 2024 alone.

Finance costs surged to N433 billion in 2024, bringing the two-year finance cost total to N669 billion.

Consequently, MTN’s accumulated losses rose to N607 billion, erasing shareholders’ equity and pushing it to a negative net worth of over N458 billion by year-end 2024.

The Turnaround

By the final quarter of 2024, signs of stability began to emerge. The foreign exchange market became more orderly, with the naira settling into a relatively stable band. FX volatility diminished, and market liquidity gradually improved.

 

Simultaneously, companies adjusted their cost structures, refined pricing strategies, and restructured foreign obligations, laying the groundwork for recovery.

 

By the end of Q1 2025, that foundation began to yield results.

 

After nearly two years of losses, the consumer goods sector posted a sharp turnaround in Q1 2025.

 

The seven companies that had reported a combined loss of N418 billion in Q1 2024 returned to a combined pre-tax profit of N289.8 billion in Q1 2025.

 

Only Dangote Sugar remained in loss territory, with a N23 billion pre-tax loss, though this was a marked improvement from the N121 billion loss recorded in Q1 2024.

The remainder of the group, including BUA Foods, Nestlé, NASCON, Nigerian Breweries, Cadbury, and International Breweries, swung back into profit, bolstered by FX gains, reduced finance costs, and operational efficiencies.

Foreign exchange losses moderated with a combined foreign exchange gain of N2.511 billion in Q1 2025 compared to the N423 billion loss in Q1 2024, with some of them recording foreign exchange gains.

 

Similarly, interest expenses decreased to approximately N94 billion compared to N170.1 billion in Q1 2024.

 

The rebound extended to the ICT sector, with MTN Nigeria continuing the profitability it had regained in Q4 2024.

 

In Q1 2025, MTN posted a pre-tax profit of N202.6 billion, compared to a devastating N575.7 billion loss in Q1 2024.

 

While still recuperating from prior accumulated losses, MTN’s return to profit was driven by:

 

Reduced FX losses to N5.25 billion from N656 billion in Q1 2024.

Slower growth in finance costs,

Increased tariffs.

Continued strength in data and fintech revenue streams.

By the end of Q2 2025, all the consumer goods companies had returned to profitability, with a combined pre-tax profit of approximately N264 billion.

 

Combined foreign exchange losses stood at just N896 million, with the most significant improvement from Dangote Sugar, which saw its foreign exchange loss drop to N160 million from N208.903 billion in the prior period of the previous year.

 

MTN Nigeria recorded a massive pre-tax profit of N419.6 billion, taking the H1 2025 profit to N622.26 billion, reducing its retained losses to N192.889 billion and shareholders’ funds to just N42 billion from N458 billion as of December 2024.

 

With these results, MTN Nigeria may be just one profitable quarter away from reversing the two years of retained losses triggered by the naira devaluation and FX volatility.

 

This sharp earnings reversal underscores how currency stability and internal cost controls can swiftly transform the fortunes of companies previously weighed down by macroeconomic headwinds.

 

As investor sentiment recovered, capital markets responded accordingly. MTN Nigeria surged to become the most valuable company on the Nigerian Exchange (NGX) by the end of July 2025.

 

Its share price reached N480 as of the close of trading last week, elevating market capitalization to N10.1 trillion.

 

In the consumer goods domain, Nigerian Breweries and International Breweries joined the billion-dollar club, standing alongside Airtel Africa, Dangote Cement, BUA Foods, Seplat Energy, Geregu Power, Aradel Holdings, BUA Cement, Transcorp Power, GTCO, and Zenith Bank.

 

Cadbury also emerged as one of the top-performing NGX stocks in July 2025, a testament to investor optimism and earnings recovery.