The president/group CEO, Transnational Corporation of Nigeria (Transcorp Plc), Owen Omogiafo, has predicted that the Nigerian manufacturing and trade sectors are likely to remain pressured, on the back of low consumption expenditure and the potential impact of limited access to forex on supply costs.
Speaking yesterday during the group’s financial performance report- Transcorp Q3 2021 Analyst Presentation and Investor Call,’ she said there are expectations that inflation rate would taper in the second half of 2022 as the pressure on supply side factors ease and the economy adjusts to new electricity tariffs and fuel price regimes.
“We also expect a modest level of monetary tightening by the central bank in 2021 as growth returns and policy shifts from one focused solely on growth to one that also incorporates price stability,” she said.
Omogiafo said positive oil market forecasts for 2021 and a potential ramp up of oil production by OPEC+ could help raise Nigeria’s oil production by 10-15 per cent as higher oil price provide an upside for revenues.
“The non-oil sectors will continue to recover in 2021 driven primarily by a sustained growth momentum in the Agriculture and Telecommunications sub-sectors. However, growth in the Agriculture sector may be slightly moderated by ongoing insecurity in some critical regions of the country,” she said.
Omogiafo said, “Transcorp Plc remains a diversified conglomerate with commanding presence in the power, oil & gas and hospitality sectors.
“We also have strong financial performance with an aggressive growth agenda. We are deeply rooted values are the 3Es of execution, enterprise and excellence.
” Nigerian economy showing a sustained positive growth over the last four quarters since the recession witnessed in 2020 although below the lower than 5.01 per cent recorded in second quarter of 2021 by 0.98 per cent points,” she added.
Transcorp Plc posted a N13.467 billion profit after tax (PAT) for third quarter of 2021.
The performance is N11.721 billion higher than the N1.746 billion it recorded in third quarter of 2020 with a 672.1 per cent year-on-year change.
According to the company’s results its profit before tax for third quarter of 2021 stood at N14.127 billion, a N12.107 billion increase from N2.020 billion recorded in the same quarter in 2020, with a 599.5 per cent year-on-year change.
The group’s gross earning and gross profit stood at N85.588 billion and N39.366 billion, respectively, compared to N54.378 billion and N22.723 billion recorded as at September 30, 2020.
Its 2021 cost-to-income ratio stood at 44 per cent, a 14 per cent decline in 58 per cent for 2020. Post-tax return on equity and post-tax return on assets for 2021 saw an increase from 1.57 per cent and 0.54 per cent recorded in 2020 to 11.16 per cent and 3.88 per cent, respectively.
With key investments in the hospitality, energy and power sectors, the group’s hospitality business recorded a 115 per cent increase in revenue from N6.791 billion in Q3, 2020 to N14.601 billion in Q3 2021. Its gross profit saw a 149 per cent increase from N4.342 billion recorded in Q3, 2020 to N10.829 billion recorded in 2021 for the same period.
For its hospitality business, the group proposes to construct Transcorp Hotels in Port Harcourt by 2024; build a 3,000 banquet-seating capacity event centre in Abuja in 2022; build a lifestyle center in Ikoyi; upgrade of Transcorp Hotels, Calabar and refurbishment of its key food and beverage outlets by 2022.
In its power segment review, Transcorp said for its Q4 2021 target, 575 MW average capacity was generated for its Transcorp Power Limited and 102 MW for its Trans Afam Power Limited as against the 677 MW and 166 MW average available capacity.
“The current available capacity for TPL and TAPL are 539MW and 120MW, respectively. Our plants are undergoing significant upgrades and repairs that will significantly increase the available capacity by December 2021.
“Given the gap in the sector and the increasing demand for electricity, the power sector remains an attractive investment choice,” the group said.
Having done its preliminary assessment in 2021 as contained in its OPL 281 notional development plan, the group said the appraisal and field development strategy would take place between 2022 and 2023 while the completion of minimum work obligations and execution of plans would commence from 2024.
“At the core of our purpose of improving lives and transforming Nigeria is our corporate social commitment driven through our 3E social impact pillars: entrepreneurship and empowerment, education and environment,” the group said of its corporate social responsibility.
“To commemorate the International Day of the Girl Child which was held on the 11th of October 2021, Transcorp had representatives speak to young girls in various spectrum of the nation in line with our agenda to remain socially responsible.
“Representatives from Transafam visited the Transafam staff school in Okoloma-Ndoki Afam community to speak to them about the digital age and the role education plays in the advancement of gender equality across the globe while a representative from Transcorp Hilton was present at an empowerment programme for young girls to pursue their career ambitions,”it stated.