NOW OPEN: Cardinal Torch Launches Series 1 of its ₦30 Billion Commercial Paper Issuance Programme

NOW OPEN: Cardinal Torch Launches Series 1 of its ₦30 Billion Commercial Paper Issuance Programme

1.     Institutional Profile and Strategic Evolution

Since its inception in 2020, Cardinal Torch Company Limited has navigated the complexities of global pandemic-induced volatility to emerge as a sophisticated pillar of Nigeria’s agro-export ecosystem. Originally structured with a lean, remote operational framework to bridge efficiency gaps in African commodity trading, the company has undergone a rapid institutional evolution. Now headquartered in Victoria Island, Lagos, with strategic links to the United Kingdom, Cardinal Torch has scaled into an enterprise-grade player capable of managing high-volume international trade flows while maintaining rigorous governance standards.

The company’s growth is underpinned by a vertically integrated business model that ensures quality control across the following nodes:

• Sourcing and Aggregation: Direct farmer engagement to secure primary produce at the source.

• Warehousing and Logistics: Comprehensive infrastructure for inventory management and streamlined movement.

• Processing and Value Addition: Transitioning raw commodities into higher-margin semi-finished and finished goods.

• Export and International Trade: Servicing high-demand markets in the UAE, Indonesia, Malaysia, and the Netherlands.

• Local Distribution: Meeting domestic demand through structured supply chains.

This foundational transition from a startup to an institutional-scale enterprise has provided the operational depth necessary to support its current market-leading volumes and its imminent pivot into large-scale industrialization.

2. Market Dominance and Commodity Portfolio Analysis

Nigeria’s non-oil export sector is a critical frontier for economic stability, and Cardinal Torch’s portfolio is meticulously aligned with commodities that command essential foreign exchange liquidity. By leveraging Nigeria’s competitive advantages in arable land, the company serves global industries ranging from food processing to pharmaceuticals.

While bulk trading ensures market dominance, Cardinal Torch is entering a phase of margin expansion, utilizing its established volume to fuel industrial value addition.

3. The Pivot to Industrialization: Ogun State Infrastructure Assets

The strategic rationale for the Siun (Ogun State) facilities marks the company’s transition from a volume-centric trader to a high-margin industrial processor. Positioned at a vital gateway between northern supply routes and southern export corridors, these assets are the primary drivers of the "Value Addition" strategy.

• ·The Cashew Processing Facility: Featuring an installed capacity of 10 MT/day of raw cashew nuts, this plant is scheduled for commissioning in Q4 2026. It captures the delta between raw exports and branded retail, with "Cardinal Treats" slated for a Q1 2026 market rollout.

• The Soya Processing Plant: Targeting $58M+ in annual revenue from Year 1, this facility addresses Nigeria's edible oil deficit, providing a defensive economic play against imported substitutes.

Strategic Impact Summary

• Profit Scaling: Cashew processing net profit is projected to grow from ₦869 million in Year 1 to ₦6.8 billion by Year 5.

• Efficiency: Soya processing offers a projected 30% ROI within three years and a 24-month break-even period.

• Socio-Economic Impact: Direct job creation and skills development within the Obafemi Owode LGA, supporting Nigeria’s non-oil export agenda.

4. Financial Performance and Quantitative Growth (2022-2025)

Cardinal Torch’s financial trajectory serves as a robust proxy for management’s execution capability, characterized by a rapid scaling of the revenue base and disciplined cost management.

Financial Health Summary

• Revenue Growth: Scaled from ₦1.5B (2022) to ₦13.93B (2025), representing a 3-year CAGR of 110%.

• Profitability: Achieved a Profit After Tax (PAT) of ₦1.08B in 2025, demonstrating the ability to maintain margins during industrial scaling.

• Shareholders’ Funds: A robust equity position of ₦2.75B as of December 31, 2025.

• Total Asset Base: Expanded to ₦5.71B, reflecting an aggressive accumulation of inventory and infrastructure.

Credit Analyst Note on Liquidity: As of FYE 2025, Cardinal Torch holds an inventory position of ₦4.1B, which provides 1.38x coverage over total current liabilities (₦2.96B). This high level of "near-cash" inventory ensures that the company can meet short-term debt obligations even amidst procurement cycle shifts.

5. Structural Merits, Use of Proceeds & Series 1 Details

Agro-commodity cycles are liquidity-intensive, requiring flexible financing to manage aggregation and processing timelines. This CP Programme provides the necessary short-term funding while offering institutional noteholders a transparent and regulated debt instrument.

Current Issuance: Series 1 Metrics

As part of the initial ₦10 Billion issuance under this programme, Series 1 presents a specific short-term investment profile:

• Series 1 Tenor: 180 days

• Discount Rate: 19.0293%

• Gross Implied Yield: 21.0000%

• Offer Period: 09 July 2026 – 16 July 2026

Use of Proceeds

To support the short-term financing requirements, funds from the issuance will be strategically allocated as follows:

• Commodity Procurement: Dedicated to the purchase of cocoa, sesame, cashew, and soybean directly at the source from farmers and aggregators across Nigeria.

• Logistics & Warehousing: Directed toward transportation from sourcing locations to port terminals, storage at export warehouses, and pre-shipment processing.

• Export & Trade Finance: Applied to pre-export finance support, documentation costs, and quality certification fees required for international shipments.

• Processing Operations: Utilized for the operational costs of the new cashew and soya processing facilities, covering raw materials, labor, and utilities.

Noteholder Terms

• Programme Size: ₦30,000,000,000 (Thirty Billion Naira).

• Target Issue Size (Series 1-3): ₦10,000,000,000.

• Status & Ranking: Senior Unsecured; ranking pari passu with all present and future senior unsecured obligations.

• Ratings: DataPro (Long-term BBB+; Short-term A2) and Agusto & Co (Long-term BBB-; Short-term A3).

• Source of Repayment: Funded primarily from the company’s operating cash flows and inventory liquidation.

6. Governance Framework and Risk Mitigation

The Board of Directors provides a multi-disciplinary balance of logistics expertise, commodity heritage, and financial oversight, essential for navigating Nigerian regulatory risks.

Board and Management Competencies

• Supply Chain Optimization: Chairman Alhaji Abba Ahmed Dantata brings two decades of logistics leadership, including former senior roles at Dangote Group.

• Commodity Trading Heritage: CEO David Olurin Jr. leverages a background in international trade finance and a family heritage in cocoa exports.

• Risk Management & Financial Oversight: Independent Director Oladipupo Adesoji Ogunbiyi provides expertise in capital structuring and M&A.

• Technical Food Safety: CTO Emmanuel H. Mshelia ensures the Siun facilities meet global FMCG and HVAC standards.

• Project Governance: Abimbola Olurin oversees PMO frameworks to ensure capital projects are delivered within scope.

Risk Analysis

• Execution and Construction Risk: The transition into industrial value addition, specifically the Q4 2026 commissioning of the Siun cashew and soya facilities, carries inherent construction and operational delays. This is actively mitigated by the PMO oversight of Abimbola Olurin and technical management by CTO Emmanuel H. Mshelia.

• Market Risk: Mitigated through a diversified commodity portfolio serving different global regions and rigorous due diligence.

• Liquidity Risk: Managed through a ₦4.1B inventory buffer and routine stress testing of cash flows.

• Operational Risk: Controlled via internal financial systems and an unmodified audit opinion from Hedgestone Professional Services.

As of the latest filing, Cardinal Torch remains a going concern, supported by an unmodified audit opinion for the year ended December 31, 2025. The combination of historical revenue growth, strong inventory-to-liability coverage, and an aggressive industrial pivot makes this ₦30 Billion CP issuance a compelling institutional credit opportunity.    

Lead Arranger: FSDH Capital Limited

Joint Arrangers: Comercio Partners Capital Limited, United Capital Plc, LeadCapital Plc, CFG Maynard Limited, First Ally Advisory Limited, Regius Capital Limited

Reporting Accountants: Hedgestone Professional Services

Solicitors: Udo Udoma & Belo-Osagie