Transnational Corporation of Nigeria Plc has projected improved performance outlook for the conglomerate in the remaining quarters of 2019, despite the inclement operating environment.
The President/CEO, Mr. Valentine Ozigbo, stated this yesterday at the company’s half year analysts parley for financial analysts and investors.
At the parley, attended by chief executive officers of its subsidiaries and other senior management staff, the company presented its financial results for the half year ended 30 June 2019.
Highlights of the group’s results revealed a gross revenue of N37.76 billion and a profit before tax (PBT) of N5.05 billion for the period under review, with a drop-in year-on-year performance.
The drop, according to the management, is mainly attributable to gas and transmission challenges faced by power business, which is being addressed by Transcorp’s management.
The hospitality business on the other hand recorded significant top line growth, following recent renovation and improvement in service delivery.
Commenting on the results, Ozigbo said: “Our half year results were affected by severe gas shortages as well as transmission and other technical challenges in our power business, especially during the first quarter of the year when supply dropped from an all year peak of 150 mmscf/d to an average of 89 mmscf/d.
“We are happy with growth in our hospitality business as it affirms the decision we made to invest $100 million in upgrading the Transcorp Hilton Abuja.”
Ozigbo further noted that “with the support of our Board, management is implementing a number of action plans aimed at addressing the gas supply challenges in a sustainable manner.
“These include the activation of a recently reviewed Gas Supply and Aggregation Agreement as well as the optimization of the opportunities embedded in it, and the exploration of additional affordable gas supply sources.
“Actualization of these as well as improvement in transmission and market payment for electricity generation will drive recovery in the second half of 2019. This is in addition to even more significant contributions from our hotel business, which is expected to sustain the increased occupancy rates seen in the first half of the year.”
Reiterating Transcorp’s bullish performance in recent years, he further stated that “through a mix of operational efficiency and strategic business development, we are confident of a more positive Q3 performance and we remain committed to our value-creating purpose of improving lives and transforming Nigeria.”
Analysts present at the event expressed their appreciation of the detailed presentation and clarification provided by the Transcorp team. They identified with the challenges faced by Transcorp during the period under review and reaffirmed their faith in the board and management of Transcorp to successfully execute their laid-out action plans to ensure a turnaround performance in Q3 2019.
“It is noteworthy that Transcorp consortium, with its bid price of N105.3bn ($293m), recently emerged the preferred bidder for Afam Genco, comprising Afam Power Plc and Afam Three Fast Power Limited, after a highly competitive bid conducted by the Bureau of Public Enterprises.
“Having attained this laudable milestone, we expect a significant growth in the company’s performance in the future upon full takeover of the new plant. This brings us closer to achieving our aspiration of providing power to one out of every four Nigerians,” Ozigbo noted.