MRS Oil Nigeria Plc has reported exceptional revenue growth of 71.3%, reaching ₦312.23 billion in 2024, driven primarily by higher Premium Motor Spirit (PMS) sales and increased contributions from other petroleum products.
The company’s profitability also surged, with Profit Before Tax (PBT) rising 63.4% to ₦9.78 billion and Earnings Per Share (EPS) climbing to ₦18.99, a 60.7% increase from ₦11.81 in 2023.
Despite challenges from rising costs, foreign exchange losses, and operational expenses, MRS Oil Nigeria maintained strong financial discipline, improved cost efficiency, and expanded its asset base, reinforcing its long-term growth strategy.
Key Financial Highlights (2024 vs. 2023)
- Revenue: ₦312.23 billion (2023: ₦182.31 billion) ↑71.3%
- Gross Profit: ₦23.92 billion (2023: ₦15.00 billion) ↑59.5%
- Profit Before Tax (PBT): ₦9.78 billion (2023: ₦5.98 billion) ↑63.4%
- Profit After Tax (PAT): ₦6.51 billion (2023: ₦4.05 billion) ↑60.7%
- Basic Earnings Per Share (EPS): ₦18.99 (2023: ₦11.81) ↑60.7%
MRS Oil Nigeria’s stellar financial performance was driven by robust sales growth, strategic cost management, and disciplined capital deployment.
Revenue Growth: Key Drivers
MRS Oil Nigeria experienced one of its strongest years of revenue expansion, primarily due to:
1. Surge in PMS Sales (+68.4%)
- PMS (Petrol) sales totaled ₦272.48 billion, contributing 87% of total revenue.
- This growth was fueled by:
- Higher market demand following fuel subsidy removal.
- Increased distribution efficiency and retail network expansion.
2. Strong Performance Across Other Fuel Segments
- Automotive Gas Oil (AGO) sales increased to ₦13.25 billion (2023: ₦9.37 billion).
- Aviation Turbine Kerosene (ATK) revenue surged to ₦17.30 billion, a 168.7% increase.
- Lubricants & Greases revenue nearly doubled to ₦8.36 billion.
- Liquefied Petroleum Gas (LPG) sales increased to ₦837.75 million, reflecting growing demand for cleaner energy alternatives.
MRS Oil Nigeria’s diversified fuel product mix helped sustain revenue growth, mitigating volatility in PMS sales.
Earnings Per Share (EPS) Growth: Key Factors
MRS Oil Nigeria’s EPS surged 60.7% to ₦18.99, supported by:
1. Higher Profitability Despite Cost Pressures
- Profit Before Tax (PBT) rose 63.4% to ₦9.78 billion, reflecting strong revenue growth and cost control initiatives.
- Gross profit expanded by 59.5%, demonstrating pricing power and operational efficiencies.
2. Improved Cost Management & Lower Forex Losses
- Net foreign exchange loss declined to ₦1.29 billion, a 60% reduction from ₦3.22 billion in 2023.
- Administrative expenses increased to ₦9.78 billion (2023: ₦5.11 billion), but as a percentage of revenue, they remained stable.
- Selling & Distribution expenses rose to ₦1.59 billion, reflecting increased marketing efforts and logistics expenses.
3. Stronger Balance Sheet & Capital Allocation
- Total equity increased 25% to ₦28.32 billion, providing a stronger capital base for expansion.
- Cash and cash equivalents surged 212% to ₦18.48 billion, improving liquidity.
Operational Highlights & Cost Management
1. Cost of Sales Increased, But Margin Remained Stable
- Cost of sales jumped 72.3% to ₦288.31 billion, in line with revenue growth.
- Gross margin remained strong at 7.7%, despite inflationary pressures.
2. Higher Selling & Distribution Expenses (+122%)
- Increased investment in retail expansion and logistics optimization.
3. Lower Impairment Losses on Financial Assets
- Impairment charges rose to ₦2.30 billion (2023: ₦191.96 million), reflecting more conservative risk management.
Despite rising costs, MRS Oil Nigeria maintained strong financial discipline, ensuring sustained profitability growth.
Balance Sheet Strength & Financial Stability
MRS Oil Nigeria significantly expanded its asset base, reinforcing long-term business growth:
- Total Assets: ₦105.43 billion (2023: ₦54.83 billion) ↑92%
- Total Equity: ₦28.32 billion (2023: ₦22.61 billion) ↑25%
- Cash & Cash Equivalents: ₦18.48 billion (2023: ₦5.91 billion) ↑212%
- Short-Term Borrowings: ₦0 (debt-free), down from ₦1.41 billion in 2023
MRS Oil Nigeria’s debt-free status enhances financial flexibility, positioning the company for future investments and expansion.
Dividend & Shareholder Returns
MRS Oil Nigeria declared a dividend of ₦809.21 million, reflecting its commitment to rewarding shareholders.
- EPS growth of 60.7% suggests potential for future dividend increases.
- Improved retained earnings and total equity strengthen long-term shareholder value.
Macroeconomic & Industry Outlook
1. Impact of Fuel Subsidy Removal & Market Adjustments
- The removal of fuel subsidies in mid-2023 increased PMS prices, benefiting revenue growth.
- However, inflationary pressures remain a challenge for consumers.
2. Foreign Exchange Volatility & Cost Impact
- The naira depreciated to ₦1,533 per USD in January 2025, affecting import costs.
- MRS Oil Nigeria aims to manage forex risks through strategic sourcing and cost controls.
3. Expansion into LPG & Alternative Energy Solutions
- The company is investing in LPG infrastructure, aligning with Nigeria’s energy transition goals.
Strategic Priorities for 2025 & Beyond
1. Retail Expansion & Infrastructure Investment
- Increasing retail outlets & expanding fuel distribution networks.
- Upgrading storage and logistics capacity to enhance operational efficiency.
2. Cost Optimization & Forex Risk Management
- Implementing cost control measures to sustain profitability.
- Managing forex risk exposure through hedging strategies.
3. Diversification into Alternative Energy Solutions
- Strengthening LPG sales to expand the company’s energy portfolio.
- Investing in solar-powered service stations & clean energy solutions.
4. Digital Transformation & Customer Engagement
- Enhancing digital payment platforms for fuel purchases.
- Leveraging customer data analytics for targeted marketing.
Conclusion
MRS Oil Nigeria Plc’s 2024 financial performance highlights strong revenue and earnings growth, demonstrating resilience and strategic execution.
- Revenue soared 71.3% to ₦312.23 billion, driven by PMS and fuel sales expansion.
- EPS climbed 60.7% to ₦18.99, reflecting profitability strength despite cost pressures.
- Total assets surged 92% to ₦105.43 billion, reinforcing long-term financial stability.
- Dividend payout of ₦809.21 million, rewarding shareholders.
With strong fundamentals, a debt-free balance sheet, and expanding market opportunities, MRS Oil Nigeria is well-positioned for continued growth in 2025 and beyond.