MOBIL OIL NIGERIA PLC - Q4 earnings improve, outlook still challenging
MOBIL reported strong rebound in Q4 sales, up 40% q/q to N19 billion – the strongest quarterly topline performance for the year. We note that this performance was in spite of the tight petroleum product supply market in the quarter. The lower margin (Q4: 14.7% vs Q1-Q3 average: 18.0%) suggests higher PMS throughput given that it is the lowest margin segment of the product mix. FY’15 revenue came in 2% shy of Vetiva’s N65.8 billion estimate. In line with the trend since Q1, rental income came in at a record N4.5 billion (67% of Operating Income), ahead of our N4.2 billion estimate and provided a much needed cushion for the challenging petroleum marketing business. We have assumed a 4% annual growth for the rental income line going forward.
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