Notwithstanding the impact of the slow economic recovery occasioned by last year’s outbreak of the novel coronavirus with new strands, the board of the Transnational Corporation of Nigeria, last week presented its unaudited financials for the first quarter ended March 31, 2021, highlights of which included a moderate increase in revenue, and a quantum leap in net profit.
The group’s power generation business along contributed 83.75% revenue for the period under review, up from 72.88% in the 2020Q1; leaving the hospitality, the group only other operating segment with 16.24%, as against the previous 27.12%; constrained by the huge impact of the virus’ outbreak on the sector. The numbers revealed the need for the conglomerate to diversify into other forward looking sectors for medium to long-term sustainability.
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Also, the group continues to make entries for its agro-allied segment in its financials with net liabilities of N1.711bn.
According to the financials, total revenue rose to N24.435bn, from N15.391bn in the first three months of last year, with its power business contributing all of N20.465bn, from N11.216bn; and hospitality, N3.969bn, a drop from N4.175bn.
A further analysis of revenue during the period showed that earnings from energy sent out, more than doubled from N6.905bn to N13.532bn; capacity charge fetched N6.928bn, up from N4.301bn; while income from rooms fell from N2.639bn to N2.554bn; and food and beverages from N1.115bn to N1.024bn; among others.
Cost of sales however rose by N5.963bn or 74.12% from N8.043bn last year, to N14.01bn, with natural gas and fuel costs gulping N11.461bn, as against the previous N5.489bn; resulting in gross profit of N10.424bn, as against the previous N7.346bn.
Administrative expenses rose mildly from N3.344bn to N3.659bn; impairment loss stood at N90m, from nil in the prior Q1; other income rose from N124.918m to N244.679m; just as foreign exchange losses stood at N3.423m, from the previous gains amounting to N7.223m. These resulted in operating profit for the period under review rose to N6.916bn, from N4.134bn.
Finance costs, being interest expense on loans dropped to N3.832bn, from N4.479bn; while finance income or interest on deposits dropped from N338.643m to N140.546m; leaving a net finance cost stood at N3.691bn from N4.141bn; foreign exchange loss on borrowing rose to N727.547m, as against the previous N 144.306m; following which profit before tax stood at N2.497bn, as against the N137.262m reported in the corresponding period of last year; while tax expense leaped from N56.472m to N456.354m. Net profit for the period, therefore, stood at N2.041bn, which translates to Earnings Per Share of 1.79 kobo; as against the N80.79m reported at the end of the 2020Q1, which amounted to the loss of 1.24 kobo each.
