May & Baker Nigeria Plc’s nine-month profit after tax rose 76.2 percent to N5.89 billion in September 2026, as a sharp reduction in production costs boosted margins despite modest revenue growth, while rising inventory and supplier payables point to increasing working-capital demands.

The pharmaceutical manufacturer’s revenue grew 4.9 percent year-on-year to N30.97 billion, but cost of sales fell 11.1 percent to N17.26 billion. This pushed gross profit up 35.6 percent to N13.71 billion and widened gross margin to 44.3 percent from 34.2 percent in the corresponding period of 2025.

The gap between sales growth and profit growth is the key development in the results: May & Baker generated substantially more gross profit from each naira of revenue.

Operating profit consequently climbed 66.3 percent to N8.45 billion, even as distribution, sales and marketing expenses rose to N3.15 billion from N3.09 billion and administrative expenses increased to N2.03 billion from N1.93 billion.

Interest income more than doubled to N861.9 million from N412 million in September 2025, while finance costs declined 32 percent to N368.5 million from N564.65 million in 2025. Profit before tax therefore increased 81.5 percent to N8.92 billion. However, tax expense rose 92.8 percent to N3.03 billion, limiting the growth in net profit to 76.2 percent.

The balance sheet shows expansion alongside pressure on working capital. Total assets increased 33.8 percent year-on-year to N34.46 billion at September 2026.

Inventory surged 81.7 percent to N9.71 billion, while trade and other receivables rose 44.9 percent to N4.04 billion. These increases outpaced revenue growth, making inventory movement and customer collections important indicators to watch in subsequent results.

Cash and cash equivalents rose 32.2 percent to N7.16 billion from N5.416 billion in the same period last year, while shareholders’ equity grew 47.8 percent to N18.54 billion from N12.55 billion.

Total liabilities increased 20.6 percent to N15.92 billion. Trade and other payables, however, more than doubled to N7.73 billion from N3.20 billion, while current borrowings fell to N1.57 billion from N3.98 billion and non-current borrowings declined to N1.68 billion from N2.44 billion.

Operating cash flow strengthened to N5.25 billion from N2.13 billion in the same period in 2025. But investing cash outflow widened to N1.14 billion, with property, plant and equipment purchases reaching N2.04 billion against N1.01 billion a year earlier. Financing activities used N3.52 billion, compared with a net inflow of N673.2 million in the comparative period.

May & Baker currently trades at N38, giving it a market capitalisation of N65.6 billion. Its year-to-date share-price return was about 100.0 percent.