October 23, 2025/Cordros Report
Presco Plc (PRESCO) published its Q3-25 unaudited financials after market close yesterday (22 October), reporting a standalone EPS of NGN21.94 (Q3-24: NGN12.89). The surge in earnings was supported by a robust topline expansion (+86.9% y/y). Consequently, the 9M-25 EPS settled higher at NGN110.79 (9M-24: NGN51.77). The Board declared an interim dividend of NGN10.00/s for the period, translating to a 0.7% dividend based on the last closing price of NGN1,479.90.
Revenue grew by 86.9% y/y in Q3-25 (9M-25: +113.5% y/y), primarily driven by increases across crude and refined product sales (+86.4% y/y | 99.8% of revenue) and a NGN189.00 million revenue from mill by-products (0.2% of revenue). The performance is attributable to higher production volumes and higher Crude Palm Oil (CPO) prices. On a q/q basis, revenue declined by 27.8% to NGN75.76 billion in Q3-25 (Q2-25: NGN104.95 billion), largely due to the seasonal impact of the lean harvest in Q3.
Geographically, revenue from Nigeria dipped by 29.7% q/q to NGN50.61 billion (Q2-25: NGN71.94 billion), while international revenue declined by 23.8% q/q, driven mainly by a 47.8% q/q drop in revenue from Ghana to NGN17.24 billion (Q2-25: NGN33.01 billion).
Gross margin contracted by 28.27ppts to 38.1% in Q3-25 (9M-25: +168bps y/y to 73.6%), following a sharper increase in the cost of sales (+243.8% y/y), primarily driven by a steep rise in raw material expenses (+2721.85x y/y) alongside higher depreciation charges on PPE (+89.7% y/y) and production costs (+76.1% y/y). Accordingly, EBIT and EBITDA margins contracted by 289bps y/y and 835bps y/y to 47.6% and 50.5%, respectively in the quarter (9M-25: +218bps y/y to 60.5% and +130bps y/y to 62.3%, respectively), amid an 84.0% y/y decline in operating expenses.
Net finance cost rose sharply by 118.7% y/y to NGN8.36 billion (Q3-24: NGN3.83 billion), as the steep increase in finance costs (+160.8% y/y) outweighed the substantial growth in finance income (+994.8% y/y). The rise in finance costs was primarily attributed to a significant increase in interest expenses on loans and overdrafts (+162.9% y/y).
Overall, profit before tax increased by 66.3% y/y to NGN27.67 billion (Q3-24: NGN16.63 billion). Following a tax expense of NGN5.74 billion, profit after tax came in at NGN21.93 billion (Q3-25: NGN12.89 billion).
Comment: PRESCO’s overall performance remains resilient, despite the decline in Q3-25 earnings due to the industry’s typical lean season. We remain optimistic about the company’s 2025FY performance, underpinned primarily by sustained volume growth and firmer CPO prices. Our estimates are under review.
