MRS PLC has released its Q3 2025 forecast, projecting a profit after tax of ₦3.95 billion, signaling sustained earnings resilience amid a challenging macroeconomic environment and tightening liquidity across Nigeria’s downstream oil and gas sector.
According to the forecast signed by its Chief Finance Officer and Managing Director, the company expects a turnover of ₦393.58 billion, with cost of sales estimated at ₦378.93 billion — leaving a modest gross profit of ₦14.65 billion.
This translates to a gross margin of just 3.7%, reflecting persistent cost pressures likely influenced by fluctuating petroleum prices, elevated logistics costs and FX volatility impacting importation of petroleum products and operational expenses.
Earnings Outlook
Despite the thin margin, MRS PLC is forecasting an operating profit of ₦6 billion, buoyed by disciplined cost containment in distribution and administrative expenses, which are estimated at ₦8.91 billion.
Additional support comes from other income streams totaling ₦261.67 million, which marginally boosts profitability.
Finance costs remain under control at ₦58.61 million, leading to a profit before tax of ₦5.90 billion. After a tax provision of ₦1.95 billion, net profit is expected to settle at ₦3.95 billion.
Earnings per share are projected at ₦11.53, confirming steady value creation for shareholders despite sector-wide headwinds.
Further breakdown reveals that ₦2.37 billion of the profit is attributable to equity holders of the company, while ₦1.58 billion will be allocated to non-controlling interests.
Liquidity and Cash Flow
MRS PLC’s cash flow position, however, reflects tightening liquidity and capital expenditure pressure. The company projects operating cash flow before working capital changes at ₦3.95 billion with additional ₦76.36 million generated from working capital adjustments, bringing total net cash from operating activities to ₦4.03 billion.
Conversely, the company anticipates a significant outflow of ₦5.63 billion from investing activities. No inflows are expected from financing activities in the quarter, leaving a net cash decline of ₦1.60 billion.
As a result, MRS PLC’s cash and cash equivalents are projected to reduce from ₦6.22 billion at the beginning of the quarter to ₦4.62 billion by the end of Q3, highlighting the strain from capital-intensive investments and the need for prudent treasury management going forward.
Strategic Implications
The forecasted performance underscores MRS PLC’s ability to maintain profitability in a high-cost operating environment.
The company’s continued focus on operational efficiency and its disciplined spending are central to sustaining margins as inflation and FX challenges persist.
However, the negative net cash position reinforces the importance of optimizing its capital allocation strategy and exploring flexible financing instruments, especially as the company may require additional funding to support future investments without eroding liquidity buffers.
In light of the projected Q3 results, MRS PLC appears positioned to deliver stable shareholder returns through 2025.
The board and executive management, led by Mr. Marco Storari and Chairman Mr. Patrice Alberti, will likely face growing pressure to balance profitability, capital investments, and cash preservation as sector conditions evolve.
Investors will closely monitor actual performance against these forecasts in the coming months, particularly developments in operating cash flows, capital expenditures and any potential financing initiatives that could influence the company’s balance sheet health and shareholder value.
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