The management of Transcorp Hotels Plc, on Wednesday presented its audited result for the full year ended December 31, 2017, showing a decline in turnover and profit after tax for the period, even as other operating income rose by N618.158m or 110.27% from N560.571m in 2016 to N1.178bn.
According to the result presented to the Nigerian Stock Exchange (NSE), revenue fell to N13.843bn from N15.311bn, representing a decline of decline of about N1.468bn or 9.58%, with a breakdown showing that room occupancy remained the biggest contributor to revenue, accounting for N8.508bn, down from N9.603bn; followed by food and beverages worth N4.091bn from N4.528bn, while income from shop rental recorded the biggest growth as it rose by 108.65% to N625.235m from N299.653m. Service charge dropped from N160.049m in 2016 to N127.785m, just as other operating revenue from N720.533m to N489.915m.
Cost of sales dropped slightly to N3.763bn from N3.889bn in the prior year, with food and beverages cost of N1.568bn, a drop from N1.687bn; and staff costs- N1.468bn, up from N1.469bn; leaving gross profit at N10.08bn, down from N11.421bn.
Administrative expense rose slightly from N7.323bn to N7.796bn, boosted by staff cost of N1.308bn, which was slightly higher than N1.237bn; followed by N1.209bn energy cost, as against N1.119bn in 2016; and depreciation of N1.018bn, up from N977.302m. Directors’ remuneration dropped to N85, from N136.779m; bank charges increased to N189.059m from N151.018m; repair and maintenance, N583.433m from N674.227m; just as management incentive fees fell to N943.374m from N1.285bn.
The other operating income growth was enhanced by net foreign exchange gains of N645.011m, up from N279.269m; other income grew from N106.167m to N181.967m; and fair value adjustment to investment from N171.535m to N309.596m.
Operating profit stood at N3.462bn from N4.659bn; just as finance income, fell from N575.585m to N217.167m, representing a N358.418m or 62.27% dropped. It was mainly interest on intercompany loan of N186.893m from N490.013m, while interest on bank deposits dropped from N85.572m to N30.274m.
Profit before tax therefore fell to N3.68bn, down by N1.554bn or 29.7% from N5.234bn; while income tax expense dropped to N998.422m from N1.139bn; leaving profit after tax at N2.681bn, down by N1.413bn or 34.51% from N4.095bn in the corresponding period of 2016.
This translated to Earnings Per Share of 27 kobo, as against the previous 35 kobo, from which the directors have recommended a final dividend of 12.45kobo per share, subject to approval by the shareholders at the annual general meeting; a drop from 40 kobo in 2016.