TotalEnergies projects N1.73bn Q3 profit as revenue nears N192bn

TOTALENERGIES Marketing Nigeria Plc has projected a profit after tax of N1.73 billion for the third quarter ending September 30, 2026, driven by expected revenue of N191.81 billion despite rising finance costs and mounting operating expenses.

The downstream petroleum marketer disclosed in its earnings forecast that turnover for the July-to-September period is expected to reach N191.81 billion, generating a gross profit of N26.33 billion after deducting cost of sales of N165.48 billion.

The company also forecast other income of N1.85 billion, which is expected to support earnings amid a challenging operating environment. However, selling and distribution expenses are projected at N4.11 billion, while administrative costs are expected to consume N17.34 billion, leaving an operating profit of N6.73 billion.

A significant drag on profitability is expected to come from financing costs. TotalEnergies projected finance costs of N4.48 billion against finance income of N368.9 million, resulting in a net finance loss of N4.11 billion.

Consequently, profit before tax is forecast at N2.62 billion, while an estimated tax expense of N890.19 million is expected to reduce net earnings to N1.73 billion for the quarter.

The forecast also points to strong cash generation from operations. The company expects net cash inflow from operating activities of N54.3 billion, supported by customer receipts estimated at N182.22 billion. Cash generated from operations before tax payments is projected at N58.11 billion.

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As part of its investment programme, TotalEnergies plans to spend N4.41 billion on fixed assets during the quarter, while proceeds from the disposal of property, plant and equipment are expected to contribute N378.55 million.

The company also plans to strengthen its balance sheet through the repayment of N52 billion in borrowings. Combined with interest payments of N4.48 billion, financing activities are expected to result in a net cash outflow of N56.48 billion.

Despite the sizeable debt repayment, TotalEnergies is forecast to maintain a robust liquidity position, with cash and cash equivalents expected to increase from N93.84 billion at the end of June to N99.67 billion by September 30, 2026.

The forecast suggests that while rising financing costs continue to pressure earnings, the company’s strong revenue base, healthy operating cash flow and ongoing debt reduction efforts could support its financial stability and position it for improved profitability in subsequent quarters.