After two years of crippling foreign exchange losses
and surging finance costs, some of Nigeria’s biggest listed companies are
enjoying a strong financial rebound in 2025, powered by a wave of operating
cash flow growth that is outpacing even their profit recovery.
The naira’s relative stability this year has sharply
reduced foreign exchange losses — and in some cases delivered FX gains —
allowing headline profits to rebound. But analysts say the more telling
indicator of corporate health lies in the cash companies generate from their
daily operations, the core engine that fuels expansion, reduces debt, and
sustains dividend payouts.
Review of first-half 2025 financial results for five
market heavyweights — MTN Nigeria, Dangote Cement, Seplat Energy, Nestlé
Nigeria, and BUA Cement — reveals combined net cash flow from operating
activities of ?2.92 trillion, a staggering 140% increase from the
same period in 2024, and 14% higher than their entire 2024 figure.
Profits also swung sharply into the black, with
combined after-tax earnings of ?1.21 trillion, compared to a ?403
billion loss a year earlier.
MTN Nigeria: From Red Ink to Cash Machine
The telecoms giant posted ?956 billion in
operating cash flow for H1 2025, outstripping its ?415 billion profit
for the period. Revenue growth, tariff adjustments, and cost control helped MTN
achieve ?622 billion in net profit, a sharp reversal from the FX-driven
losses of 2024.
The company also made significant progress in
repairing its balance sheet, cutting negative equity from ?458 billion
at the end of 2024 to ?42.5 billion by June 2025. Analysts at
CardinalStone expect MTN to resume dividend payments this year, citing its 9.8%
operating cash flow per share yield.
Dangote Cement: Steady Profits, Stronger
Liquidity
Africa’s largest cement producer generated ?874
billion in operating cash flow in the first half, more than double last
year’s ?412 billion. Net profit climbed to ?521 billion,
supported by efficient working capital management, reduced prepayments, and
strong core profitability.
With such liquidity, market watchers believe Dangote
Cement can comfortably fund expansion, reduce leverage, and maintain its
dividend policy.
Seplat Energy: Cash Flow Outshines Profit
Despite reporting a relatively modest ?42 billion
profit after tax — weighed down by heavy taxation — Seplat’s cash flow tells a
different story. The oil and gas firm delivered ?755 billion in
operating cash flow, boosted by robust revenue, tight cost controls, and a
hefty ?518.9 billion depreciation and amortisation charge.
CEO Roger Brown said the company’s strong liquidity
will allow it to reduce debt by $100 million, sustain its dividend
record, and withstand macroeconomic volatility.
Nestlé Nigeria: Quiet Turnaround
The food and beverage giant posted a ?50.6 billion
profit for H1 2025, reversing a ?177 billion loss in the same period
last year. But the standout number was its ?187.6 billion in operating
cash flow, a major turnaround from a negative ?27.7 billion in 2024.
While Nestlé has yet to resume dividend payouts, its 13%
operating cash flow yield signals strong capacity for debt reduction,
reinvestment, or future shareholder returns.
BUA Cement: Profits Lead, Cash Lags
BUA Cement’s operating cash flow rose to ?150
billion from ?62.6 billion in 2024, but still fell short of its ?181
billion profit after tax. The gap suggests higher working capital
requirements or slower cash collection, despite a 435% surge in pre-tax profit
to ?215 billion.
Analysts: Cash Flow Is the New Profit
While the drivers differ — from MTN’s FX recovery to
Seplat’s depreciation-driven liquidity and Nestlé’s operational revival —
analysts agree that in 2025, operating cash flow has emerged as the truest
measure of corporate resilience in Nigeria’s post-crisis economy.
They add that this surge in cash generation could mark
a “golden window” for investors seeking dividend rebounds, capital gains, or
exposure to reinvestment-led growth stories.
The coming quarters will determine whether these
windfalls are sustainable. But for now, the message is clear: Nigerian
corporates are proving that in business, profits may win headlines — but cash
is still king.
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