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TRANSCORP Declares N1.13 mln Loss in 2016 Audited Results,(SP:N0.69k)

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Wednesday, March 01, 2017 3.50 PM / NSE


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Transcorp Group Reports Strong Revenue Growth of 46% for the Year Ended December 31, 2016

Transnational Corporation of Nigeria Plc (Transcorp), Nigeria’s foremost investment conglomerate has announced financial results for its full year ended December 31, 2016.

The Group Revenue was N59.42bn which translates to a 46% revenue growth for the year compared to FY 2015. Group loss Before Tax was N5.93bn compared to Profit Before Tax of N3.32bn in FY 2015.

Income Statement
         Revenue: N59.42bn, significant growth from N40.75bn in FY 2015 (46%YoY increase)
         Gross Profit: N30.17bn, improved from N24.33bn in FY 2015 (24%YoY increase)
         Operating Profit: N20.72bn from N15.03bn in FY 2015 (38%YoY increase)
         Foreign exchange loss: N18.70bn compared to N11.71bn in FY 2015
         Net Finance cost: N26.64bn compared to 11.71bn in FY 2015
         Tax Credit: N4.80bn compared to tax expense of N1.29bn in FY 2015
         Loss Before Tax: N5.93bn compared to Profit Before Tax of N3.3.2bn in FY 2015
         Loss After Tax: N1.13bn compared to Profit After Tax of N2.03bn in FY 2015

Balance Sheet
         Total Assets: N232.16bn compared to 202.88bn in FY 2015
         Shareholders Fund: N86.45bn, 1% decrease from 87.51bn in FY 2015

Commenting on the results, Emmanuel Nnorom, President/CEO said the loss reported in the year was from unrealized foreign exchange loss due to the impact of material devaluation of the Naira against the United States Dollar (USD) on a USD acquisition facility for our Power subsidiary.

The official exchange rate at the end of the year was N304.5/$1 compared to N196/1$ at the beginning of the year 2016. The illiquidity in accessing foreign currency affected the Management’s plan to convert the USD facility to local currency.

Average generation at Transcorp Power Limited was 55% of available capacity during 2016 compared to 65% in FY 2015. The generating capacity for Transcorp Power Limited declined significantly during the year as a result of the deteriorating gas supply situation from gas pipeline disruptions.

Despite this, Transcorp Power remains a top 3 player in terms of power contributed to the national grid. We recovered significantly from the exchange loss during the year s we maintained cost levels and efficient liquidity management despite a debt of N50bn from invoices generated for power production.

However, our hospitality business remains resilient, posting stronger year-on-year performance. Specifically, we continue to maintain market leadership with occupancy levels that are ahead of competition.

In addition, our second Hotel, Transcorp Hotel Calabar started on a track of strong performance achieving profitability as well.

We are confident of improved fundamentals going forward as we are increasing our available generation capacity to 850MW by year-end taking advantage of recently improving gas situation.

We expect continued liberalization of the foreign exchange market in line with recent developments which will help create needed liquidity and solution for our USD facility.

We expect to benefit form the upside of the new improved infrastructure upon completion of our upgrade project in Transcorp Hilton Abuja. The upgrade project is currently on track.

It is our strong belief that the impact of the difficult operating environment is temporal and through diligent execution f our growth strategy, our investment proposition remains strong in the near term.


 

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