Update shared on 25 Jun 2025
Subject: TotalEnergies Nigeria Projects Q3 Profit Amid Mounting Finance Costs and Cash Flow Pressures
TotalEnergies Marketing Nigeria Plc has released its Q3 2025 projections, signaling resilience in its core operations with a forecast profit after tax of N543 million, despite mounting finance costs that continue to pressure overall profitability.
The company anticipates revenue of N177.1 billion, with cost of sales pegged at N150.6 billion, resulting in a gross profit of N26.5 billion. After accounting for operating expenses—notably administrative costs of N17.1 billion and selling and distribution expenses of N3.6 billion—operating profit is projected at N7.7 billion.
However, finance charges remain a key drag on performance. The company expects interest expenses of N7.2 billion, well in excess of its projected finance income of N933 million, leading to a net finance cost of N6.3 billion. Consequently, profit before tax is expected at N1.4 billion, with tax charges of N886 million narrowing the projected net profit to N543 million.
On the liquidity front, operating activities are expected to generate N19.1 billion in cash, underpinned by N159.4 billion in customer receipts and N135.5 billion in payments to suppliers and employees. However, investing and financing activities pose a significant cash strain.
- Investing activities will lead to a net outflow of N1.6 billion, mainly due to capital expenditures on fixed assets.
- Financing activities are expected to drain N27.1 billion, primarily from:
- N7.2 billion in interest payments on overdrafts,
- N17.3 billion in debt repayments, and
- N2.6 billion in dividend payments.
As a result, the company anticipates a net cash outflow of N9.7 billion, bringing the cash and cash equivalents balance to a negative N155.5 billion by Q3-end. This persistent negative cash position highlights the urgent need to address debt service costs and optimize financing structures.
While TotalEnergies continues to deliver operational profitability, the high leverage and financing burden remain critical watchpoints. The sustainability of future earnings will depend largely on the company’s ability to restructure its liabilities and improve cash flow efficiency in the coming quarters.
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