By Ahmed Ahmed
Geregu Power Plc has begun a comprehensive review of its financial obligations and corporate records following concerns over its ability to meet obligations under its bond programme, assuring investors and regulators that it is working towards an orderly resolution.
The power generation company said the review covers its transactions, liabilities, operational commitments, financing arrangements and other financial obligations, as well as related corporate documentation.
The move comes after Geregu failed to make the eighth semi-annual coupon payment and fourth scheduled bullet principal repayment on its N40.09 billion Series 1 Senior Unsecured Fixed Rate Bond.
The development has placed the company’s financial position under closer scrutiny, particularly after a sharp deterioration in its first-half 2026 performance.
Geregu reported revenue of N18.65 billion for the six months ended June 2026, representing a 78.7 percent decline from N87.63 billion recorded in the corresponding period of 2025. Profit after tax also fell by about 88 percent, from N20.27 billion to N2.54 billion.
The company has attributed the operational setback to its N61.47 billion major turbine maintenance programme, which has affected its power generation capacity and, consequently, its revenue performance.
Against this backdrop, the bond repayment challenge raises broader questions about the company’s liquidity position, debt-servicing capacity and ability to balance significant capital expenditure with its financing obligations.
Geregu, however, said the current board and management were taking steps to establish a clearer picture of the company’s financial position.
“Since assuming responsibility for the Company’s affairs, the current Board and Management have undertaken a comprehensive review and reconciliation of the Company’s transactions, liabilities, operational commitments, financing arrangements, financial obligations and related corporate documentation,” the company stated.
According to Geregu, the exercise is designed to promote “transparency, accuracy and prudent financial management” while providing greater clarity around its financial obligations.
The company also acknowledged concerns from shareholders, investors, regulators and other stakeholders, saying discussions with relevant parties and advisers were ongoing.
“Geregu remains actively engaged with relevant stakeholders and advisers regarding the resolution of the various challenges and is committed to achieving an orderly and mutually beneficial outcome,” it said.
The assurance is significant for investors because the bond obligation goes beyond the immediate repayment issue. It also puts the spotlight on how the power producer manages its balance sheet while undertaking major maintenance spending needed to sustain its generation assets.
For a power company, prolonged operational constraints can have a direct impact on electricity generation, revenue collection and cash flow. This makes the timing of debt repayments particularly important when large maintenance commitments are already competing for available financial resources.
Geregu nevertheless sought to separate the financial review from its core operational responsibility, stressing that its commitment to power generation remained intact.
“The Company considers it important to reassure its shareholders, investors, regulators and the general public that it remains fully committed to the task of generating power for its consumers,” the company stated.
The company further pledged to maintain transparency and responsible corporate governance as it works through the challenges.
“The board and management remain committed to transparency, responsible corporate governance and constructive engagement with all stakeholders,” Geregu said.
It stated that the company would continue to provide the market with appropriate updates on material developments concerning its performance in line with applicable regulatory requirements.
The latest development therefore leaves investors watching two parallel issues: how Geregu resolves its outstanding bond obligations and how quickly its operational performance can recover from the turbine maintenance programme.
While the company has not disclosed a final resolution of the bond repayment issue, its decision to undertake a detailed reconciliation and engage stakeholders signals an effort to establish a structured path forward.
For bondholders and shareholders, the outcome of those engagements will be critical. The immediate concern is debt resolution, but the longer-term test will be whether Geregu can restore generation capacity, strengthen cash flows and rebuild confidence in its ability to meet future financial commitments.
Geregu expressed appreciation to its stakeholders for their “patience, understanding, and continued support” as the review and engagement process continues.
