Improving cost controls and lower finance expenses could help TotalEnergies Marketing Nigeria Plc return to profitability in the second quarter of 2026, according to the company’s latest financial projections.
The downstream oil and gas marketer is forecasting a pre-tax profit of about N1.3 billion for the quarter, with earnings per share expected to reach N3.90. If achieved, the result would represent a significant turnaround from the same period in 2025, when the company reported a post-tax loss of N2.7 billion.
The projection signals early signs of recovery after a challenging financial year in which the firm recorded its first annual loss in six years.
Revenue Pressures but Margins Improve
Financial estimates for the second quarter suggest revenue could reach roughly N169.9 billion, lower than the N202.2 billion recorded in the corresponding quarter of 2025.
Despite the expected decline in turnover, profitability may improve due to tighter cost management. Cost of sales is projected at about N145.5 billion, leaving the company with a gross profit of approximately N24.3 billion—slightly higher than the N23.9 billion posted in Q2 2025.
A major factor supporting the expected recovery is the reduction in operating expenses. Administrative costs are forecast to fall significantly to N16.6 billion, compared with N21.3 billion in the same period last year.
As a result, operating profit is projected to rise sharply to N6.35 billion in Q2 2026, an increase of nearly 90% from the N3.35 billion recorded a year earlier.
Finance costs are also expected to decline. Interest expenses linked mainly to bank overdrafts could drop to about N4.7 billion, down from N7.1 billion in Q2 2025. Lower financing costs would further support the company’s return to profitability.
If the projections hold, the company expects to post a post-tax profit of about N1.3 billion for the quarter—reversing last year’s loss and improving on its Q1 2026 estimate of N251.9 million.
Recovery After a Challenging 2025
The forecast comes after a difficult financial performance in 2025. During that year, TotalEnergies Marketing Nigeria reported a post-tax loss of N17.18 billion, a sharp reversal from the N27.5 billion profit recorded in 2024.
The downturn was largely driven by a significant drop in revenue, which fell by 26% to N767.63 billion from N1.04 trillion in the previous year. At the same time, cost of sales remained high at N685.55 billion, reducing gross profit by nearly 29% to N82.07 billion.
Operating costs also weighed heavily on earnings. Administrative expenses rose by about 19.7% to N77.4 billion, pushing operating profit down by 85% to N9.49 billion.
Rising finance costs added further pressure, with net financing expenses increasing by about 12% to N21.99 billion due to higher reliance on bank overdrafts.
Market Performance on the Nigerian Exchange
Despite the challenging earnings cycle, the company’s shares have maintained a generally positive long-term trend on the Nigerian Exchange Limited.
However, investor sentiment has been more cautious in recent months. Since around September 2025, the stock has largely traded sideways, reflecting market uncertainty over the company’s earnings recovery.
Shares are currently trading around N640, and analysts suggest that stronger financial results—particularly if early 2026 earnings show clear improvement—could help restore bullish momentum for the stock.
For investors and market watchers, the upcoming quarterly results will therefore serve as an important indicator of whether the company’s cost-cutting measures and operational adjustments are sufficient to restore sustained profitability.