Conglomerates: Why Transcorp Leads In Nigeria

By Elizabeth Chukwuma

In spite of the harsh operating economic environment in the country, Transcorp plc, a public quoted company with a shareholder base of approximately 300,000, has sustained its growth rate, which has positioned it as Nigeria’s leading conglomerate.

The Conglomerate, which according to informed source have strategic investments in the nation’s power, hospitality and energy sectors of the nation’s economy appears to have established itself on ground. Among the notable businesses engaged by the conglomerate includes Transcorp Hilton, Abuja, the Federal Capital Territory, FCT, Transcorp Hotels, Calabar, Capital of Cross river, a state in the south-south geopolitical region, Transcorp Power, Transafam Power and Transcorp Energy. 

Trnscorp Hilton, Aabuja

While other conglomerates in the first half of 2023, are counting their loses and drop in financial results, Transcorp conglomerate are counting their gains and improved financial results in the first half of 2023.   A top official of the conglomerate who spoke to The Value News in Abuja, the Federal Capital Territory when confronted confirmed that the company has sustained its financial growth. He was emphatic that that the conglomerate which had initiated measures to remain atop in its businesses   have recorded ‘’commendable growth across all its major indices to the surprise of its competitors in all sectors of the Nigerian economy.

The conglomerate was said to have earned a total revenue of N82.1 billion between January and June 0th , 2023,  compared to  about N63 billion, it was said to have generated during the same period in 2022, showing  a substantial  growth rate of 31% . There are indications that the conglomerate operating income also grew phenomenally to about N30 billion compared to N20.5 billion generated between January and June 30, 2022.

There are indications that the conglomerate operation income also grew to about N30 billion   compared to N20.5 billion earned within the same period in 2022.

.  Not many had expected the conglomerate to generate that much in its busses because it was a year the country had organised its Presidential and National Assembly including the governorship and state Assembly elections that had ushered in the present government both at the state and federal levels.

Many believe that the Management of the companies in the Group at the various sectors of the economy acting on the mandate of Tony Elumelu, the Chairman, may have gone back to the drawing board to design a roadmap  that will continue to improve on their revenue generation  and still remain atop among its competitors.

The impressive performance of the conglomerate  in the first six months of 2023, may have informed why the Management  had  spent  about N16 billion , compared to N11.3 in the first  half of 2022, in its operating expenses to improve on its services that will still make it the first choice of customers.

Going by the financial report filed by the conglomerate Management with the Nigeria Stock Exchange Commission, sighted by The Magazine, the Group, reported a 39% growth in Profit Before Tx, PBT, of N18.5 billion between January and June, 2023 as against the N13.4 billion recorded in the first half of 2022. The conglomerate   interest cost was said to have declined by 9% to N6.6 billion as at June 30, 2023 from the N6.1 billion achieved within the same period in 2022.

Suffice it to say that Transcorp conglomerate has continued to maintained a strong- balanced sheet, with total assets  rising to  N495 .3 billion , which valuation experts had put at  a 12%  increase over  its total assets as at June 30, 2022, put at N 442.7 billion . This is due to the increase in the Group debt and equity securities   put at  61%. The increase was said to have also been attributed   to the conglomerate trade and other receivables put at 40% which was said to have cushioned the effect of the decline in inventories. By 68%.

The management of the conglomerate were said to have also made it possible for the shareholders to enjoy their investments as huge amount was said to have been voted into the shareholders’ funds. It is not surprising why the Transcorp plc shareholders funds had remained strong at   N176.3 billion, up from about N155 billion   recorded in in the same period last trading year., further enforcing the company’s commitment to delivering long-term value to its shareholders.

Mrs. Owen.D. Omogiafo, OON,  President/ Chief Executive Officer,  Transcorp plc,  who could not hide his feelings over the continued impressive performance of the conglomerate despite the challenging operating environment , characterised  by foreign exchange  volatility , gas supply  constraints  and rising inflation , among others,  could beat his chest  that the Group               will sustain  the impressive growth rate recorded in the first half of his year  in the second half of the year and the years ahead.

She noted that ‘’the first of 2023, Financial results further confirm the conglomerate dedication ‘’to driving innovation and seizing opportunities for sustainable growth and positing the Group as a trailblazer in the nation’s business realm’’. She disclosed that that Group power businesses, particular, Transcorp Power Limited and Transafam Power Limited, on its part had sustained revenue growth increase 32% and 30% respectively while the Group hospitality sector has continued to outperform across all indices.

She may have sent a message to its competitors in the power, energy and hospitality sectors  of the economy that the conglomerate will ever remain on top  because it  has remained focused  on ‘’efficiency, cost leadership and meeting market  demand  to consistently deliver  profitability  and value to its shareholders and staff’’.

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