Legend Internet Profit Drops 92% as Costs and Debt Rise

AFRICAN STOCKS AND FINANCESeptember 17, 2026 at 1:24 PM UTC

TLDR

Legend Internet Plc (NGX: LEGENDINT) reported a significant decrease in pre-tax profit by 92.35%, reaching ₦13.21 million, primarily due to higher administrative and financing costs despite broadband revenue.
Revenue dipped by 7.44% to ₦1.10 billion, while profit after tax fell by 90.73% to ₦13.21 million, with earnings per share dropping to 1 kobo from 7 kobo.
The company's core Legend Fibre business saw a decrease in revenue to ₦930.20 million by about 17.3%, while wholesale bandwidth revenue surged by 331.4% to ₦162.58 million.

Legend Internet Plc (NGX: LEGENDINT) posted pre-tax profit fell 92.35% to ₦13.21 million for the year ended July 31, as higher administrative and financing costs offset its broadband revenue. Revenue declined 7.44% to ₦1.10 billion from ₦1.19 billion, while profit after tax fell 90.73% to ₦13.21 million. Earnings per share dropped to 1 kobo from 7 kobo.

The company’s core Legend Fibre business generated ₦930.20 million, down about 17.3%. Wholesale bandwidth revenue moved in the other direction, rising 331.4% to ₦162.58 million. Gross profit fell 6.23% to ₦714 million, while gross margin increased to 64.76% as cost of sales declined.

Expenses put pressure on earnings. Administrative costs rose 88.87% to ₦1.06 billion, including ₦355.31 million of professional fees compared with ₦4.30 million a year earlier. Finance costs increased to ₦314.74 million from ₦28.58 million. Legend recorded a ₦344.05 million operating loss before other income, compared with a ₦201.24 million operating profit in 2025.

A ₦672 million gain from asset disposals kept the company profitable. Legend also ended the year with ₦1.14 billion of borrowings, compared with ₦75.23 million a year earlier. The balance includes a ₦1.12 billion bridge loan carrying a 35% annual interest rate and due in December. Cash fell 71.02% to ₦6.09 million, while operating cash outflow reached ₦1.14 billion.

Legend shares closed at ₦4.05 on September 15, down 23.4% in 2026 and about 49% below their March high of ₦7.98. The company’s free float increased to 27.24%, bringing it above the Nigerian Exchange Main Board requirement.

Key Takeaways

Legend Internet’s main issue is not the fall in accounting profit alone but the gap between its operating cash needs and available liquidity. The company finished the year with only ₦6.09 million in cash while carrying about ₦1.14 billion of borrowings, most of it through a bridge facility charging 35% a year and maturing in December. That financing structure explains why finance costs increased more than 10 times to ₦314.74 million. The ₦672 million asset-disposal gain allowed Legend to report a profit, but it does not represent recurring earnings from broadband operations. Without it, the company would have recorded a loss. The operating business also weakened as fibre revenue fell 17.3%, though the 331.4% increase in wholesale bandwidth provides another source of growth. Investors will now watch whether Legend can refinance the bridge loan, reduce professional and administrative expenses and turn its wider asset base into cash generation. The rise in free float to 27.24% may improve trading liquidity, but it does not address the funding issue. With the shares down 23.4% this year, the next results will need to show progress in cash flow and debt costs, not only revenue growth.

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