Custodian Investment Plc expects profit to nearly double in 2025 as higher revenue and investment gains offset surging expenses, underlining resilience in Nigeria’s insurance and investment holding sector despite a tougher operating environment.
The Lagos-based group projects full-year profit after tax at N58.28 billion, up 88 percent from N30.98 billion in 2024, according to its filing with the Securities and Exchange Commission.
Revenue is forecast to climb 57 percent to N228.04 billion, reflecting stronger underwriting income and higher returns from financial assets.
Fair value gains are set to more than double to N22.64 billion, boosted by revaluation of investment assets, while share of earnings from associates is projected at N2.48 billion, up more than fourfold. These helped lift pre-tax profit to N66.75 billion, an 84 percent increase from a year earlier.
Yet the company faces mounting costs. Operating expenses are expected to jump 57 percent to N163.56 billion, outpacing topline growth and highlighting pressure from inflationary wage adjustments, higher claims, and administrative outlays. Management expenses will rise by 26 percent to N22.56 billion, while finance costs remain relatively flat at N285 million.
Custodian also projects a 16 percent drop in net operating cash flows to N36.1 billion, partly due to a tenfold surge in commissions paid, which will consume N94.1 billion in 2025 compared with just N11.6 billion last year.
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The strain is visible in its liquidity outlook: cash and cash equivalents are forecast to decline to N35.36 billion from N43.99 billion at the start of the year.
The firm expects to invest heavily in financial assets, with acquisitions projected at N88.48 billion, outweighing redemptions of N20.72 billion.
Dividend payouts are forecast to rise to N7.94 billion, reflecting management’s confidence in sustained profitability despite thinner cash buffers.
Custodian’s outlook mirrors a broader industry trend in Nigeria where insurance and investment companies are leveraging fair value remeasurements and asset management gains to shore up earnings amid high inflation, tighter regulation, and volatile capital markets.
While the surge in profit underscores financial resilience, analysts will likely focus on whether the company can sustain earnings momentum as rising costs and weakening operating cash flows tighten liquidity.
Shares of Custodian Investment have gained 138 percent year-to-date closing trading on Monday at N40.75. According to African Exchange, a data analytics website, the stock is ranked 31st on the NGX in terms of year-to-date performance.
“Shareholders can be optimistic about CUSTODIAN knowing the stock has accrued 9% over the past four-week period—19th best on NGX.”