Chams Holding Company Plc, one of Nigeria’s oldest indigenous tech firms and a pioneer in digital identity and payment solutions, delivered strong revenue growth in the first half of 2025, even as post-tax profit plunged amid macroeconomic headwinds that pushed costs higher and financing burdens up.
Net profit for the six months ended in June dropped by 54 percent to N419 million from N901 million in H1 2024, while Q2 profit fell 64 percent to N270.1 million from N754.8 million a year earlier.
The Lagos-based firm recorded N9.88 billion in revenue, up 18.8 percent from N8.32 billion, buoyed by stronger contract wins and growing uptake of its identity and payments platforms. But the cost of sales rose over 40 percent to N7.92 billion, shrinking gross margin to 19.8 percent from 32.1 percent and reducing gross profit to N1.96 billion.
Analysts attribute this partly to inflation and dollar-denominated purchasing costs made more expensive by the naira’s devaluation. The currency lost over 40 percent of its value against the dollar last year, but it’s been largely stable this year.
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Other operating income rose to N191 million from N9.9 million, but operating profit still fell 29 percent to N948 million, unable to offset heightened input costs and overheads.
The most significant drag was finance cost: Chams incurred N436.7 million, a more than fivefold jump from N69.17 million the prior year, reflecting increased borrowing costs tied to Nigeria’s tight monetary stance and benchmark interest rate of 27.5 percent.
That surge slashed profit before tax to N529.6 million from N1.29 billion, and after a tax charge of N110.7 million, net profit halved to N419 million, leaving earnings per share at 8.92 kobo versus 19.19 kobo a year earlier.
The Q2 performance mirrored the half-year story as revenue increased to N6.01 billion from N4.85 billion, but rising costs and debt servicing eroded earnings.
On the balance sheet, the group closed June with total assets of N20.71 billion and equity of N10.49 billion, leaving liabilities of about N10.22 billion. Revaluation reserves helped narrow accumulated losses to N1.37 billion from N1.79 billion.
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Nigeria’s macroeconomic landscape remains volatile even as marked improvement has been achieved. Inflation has slowed for the third straight time to 22.2 percent in June, but it’s still at a high double-digit, stoking pressures on firms.
Currency reforms have brought some level of stability to the FX market, but inflation and elevated debt costs continue to squeeze firms, especially those with FX-linked sourcing and significant leverage.
Chams is in the middle of a strategic overhaul, with shareholders recently approving a capital raise and a rebrand to ‘Chams Corporation Plc’ to bolster the balance sheet and finance growth in payments and digital identity platforms.
Analysts warn that turning robust revenue growth into sustained profitability in the second half will depend on tighter cost control, lowering exposure to costly debt, and holding ground in an increasingly competitive fintech market.