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Transcorp Power reports N28.772 billion pre-tax profit in Q1 2024

Transcorp Power Plc has reported a pre-tax profit of N28.772 billion for the Q1 ended March 31, 2024.

This represents an impressive 774.85% YoY increase and accounts for 55% of the pre-tax profit reported for the entire fiscal year of 2023.

According to the company’s Q1 2024 unaudited interim reports, Transcorp Power reported an impressive revenue of N67.862 billion, marking 222.54% YoY increase from the N21.040 billion reported the year prior.

Approximately 67% of this revenue stemmed from energy delivered, with 33.34% from capacity charges.

Key highlights (Q1 2024 vs Q1 2023)

  • Revenue: N67.862 billion +222.54% YoY
  • Cost of sales: N33.084 billion +147.96% YoY
  • Gross profit: N34.779 billion +351.80% YoY
  • Impairment loss on financial assets: N1.089 billion +1,302.44% YoY
  • Admin expenses: N4.280 billion +382.01% YoY
  • Operating profit: N29.410 billion +336.08% YoY
  • Finance cost: N2.176 billion +40.83% YoY
  • Foreign exchange gain: N240 million +109.89% YoY
  • Profit after tax: N20.141 billion +665.50% YoY
  • Earnings per share: N2.69 -91.80% YoY

Since its listing by introduction on March 4, 2024, Transcorp Power has experienced a notable 42.8% YtD increase in its share price, leading to a market capitalization of N2.83 trillion and ranking it 13th on the NGX in terms of year-to-date performance.

Commentary

  • Revenues from capacity charge and energy delivered continue to be the major drivers of total revenue, jointly contributing 99.99%. Their growth of 222% outpaces the 148% growth in the cost of sales, culminating in a healthy gross profit margin of 51.25%,
  • Expense Analysis: The rise in natural gas and fuel costs remains the primary driving force behind the cost of sales for Transcorp Power Plc. These costs account for about 91% of the total cost of sales, indicating their significant impact on the company’s operational expenses.
  • Additionally, impairment losses on financial assets and administrative expenses persist at elevated levels. This suggests the need for continued attention and strategic management to mitigate their impact on the company’s financial performance.
  • However, the foreign exchange gain of N240 million compared to the foreign exchange loss of N2.422 billion in Q1 2023, along with growth in interest income on fixed deposits, equally played a part in the significant 666% year-over-year growth in profit after tax.

Recommended Reading: Transcorp Power: Driving growth and investor confidence


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