August 04, (THEWILL) — Transcorp Hotel Plc (a subsidiary of Transnational Corporation Plc) recorded impressive results in H1 2025 on strong performance ratios that pushed revenue up by 60 percent.
This is amid economic headwinds characterized by high inflation, increased operating expenses and exchange rate pressure. However, the foremost hospitality firm witnessed a significant rise in revenue to N47.57 billion for the period ended June 30, 2025 against N29.71 billion in the corresponding period of 2024.
Analysis of the firm’s unaudited financial statement for the period ended June 2025, filed with the Nigerian Exchange Limited (NGX) shows it experienced a strong half year — with significant topline and bottom-line increases, as well as improved financial leverage.
Transcorp Hotels reported a pre-tax profit of N12.22 billion during the review period against N10.47 billion in H1 2024, constituting a 16.71 percent increase. Post-tax profit showed a moderate increase to N8.76 billion from N6.61 billion in H1 2024.
Consequently, the firm recorded a 9.0 percent expansion in its balance sheet with an assets base of N153.45 billion from N140.69 billion as of December 31, 2024, reflecting an improved gearing ratio.
The impressive performance was a reflection of the significant debt-to-equity ratio reported in the FY 2024 which decreased from 17.48 percent in FY 2023 to a 9.30 percent in 2024, on consistent principal repayment of third-party loans, signaling a similar positive result when the FY 2025 is published.
This also reflected a flat movement in finance costs to N1.84 billion in H1 2025 from N1.86 billion in the same period of last year.
Interest on debts and borrowing decreased from N1.41 billion in the equivalent period of 2024 to N989 million in H1 2025, suggesting the positive impact on revenue and cash position.
This helped in moderating the liquidity squeeze that would have put a pressure on the company’s balance sheet as cash generated from operations increased to N11.14 billion in the review period against N8.49 billion as of December 31, 2024.
The report also showed that interest on inter-company loan payable rose significantly to N910 million against N570 million.
Similarly, return-on-equity grew from 8.21 percent as of December 31, 2024 to 10.49 percent in H1 2025, indicating efficient income generation from equity, as shareholders look forward to the 2025 dividend exceeding the N10.1 billion dividend declared for the 2024 full year, constituting N1.00 per ordinary share.
A major expenditure item was employee cost which rose significantly from N2.4 billion to N5.4 billion. While the provided information does not detail the specific reasons for the increase, potential organisational factors could have accounted for the surge.
These include expansion in operations due to revenue growth which may have led to increased hiring and staffing levels. Salary increases or adjustments to compensate for inflation or market rates could also have contributed to the higher employee costs.
According to some organisation’s practice, increased revenue and profit might have triggered performance-based bonuses for employees, impacting the overall cost.
Changes in employee benefits packages or increased costs related to employee welfare could also play a role.
Transcorp Hotels experienced a 60 percent year-on-year revenue growth, reaching N47.57 billion in H1 2025, and a 71 percent increase in gross profit, reaching ₦36.21 billion.
The expanding business activities, rising energy cost and the effect of the naira devaluation also culminated in the increase in operating expenses which rose by 71.9 percent to N22.83 billion against N13.28 billion in the equivalent period of 2024.
A finance analyst, Dr Jerry Abudu, said that Transcorp Hotels is riding on the crest of the favourable economic climate that boosts the hospitality and tourism sector resulting in the high contribution by Services to the GDP.
According to the National Bureau of Statistics (NBS), the Services sector has driven the gross domestic product (GDP) growth of the economy for a long time, incorporating improvement in Tourism and Hospitality among others.
Nigeria’s economy expanded by 3.13 percent year-on-year in the first quarter of 2025, accelerating from 2.27 percent in the same period last year. The services sector remains the key growth engine of the economy for the past decade, rising 4.33 percent and contributing 57.5 percent to GDP (year-to-year) in Q1 2025, according to the National Bureau of Statistics (NBS).
In H1 2025, Transcorp Hotels generated N31.33 billion from room sales, a significant increase from N19.66 billion in H1 of the previous year, highlighting a strong performance in this area.
Transcorp Hotels also saw a substantial increase in revenue from food and beverages, reaching N13.67 billion in 2024, up from N8.66 billion in the corresponding period of last year.
This suggests a strong impact of the Services sector, during which the company’s overall revenue also experienced significant growth.
The strong performance of Transcorp Hotels in FY 2024 pushed it into the trillionaire club at the Nigerian Exchange (NGX) — the same year the firm emerged the Best Hospitality Provider in Nigeria in the HOTEL/HOSPITALITY AWARDS 2024 by Global Brands Magazine (GBM).
Global Brands Magazine, one of the largest and most respected brand publications globally, conducts an annual series of awards to honour companies that have distinguished themselves as industry leaders.
Transcorp Hotels Plc emerged victorious due to its exceptional commitment to innovation, quality, branding activities, and superior customer service.
“In receiving this award, Transcorp Hotels Plc has solidified its position as a trailblazer in the Nigerian hospitality sector. The company continues to lead with a robust system that not only meets but exceeds industry standards, making it a beacon of excellence in the HOTEL/HOSPITALITY sector in Nigeria,” the firm had said.
Regarding its stock market performance, Transcorp Hotels closed its last trading day (Friday, August 1, 2025) at N149.80 per share on the Nigerian Exchange (NGX). Transcorp Hotels began the year with a share price of N116.00 and has since gained 29.1 percent on that price valuation.
Analysts said shareholders can be optimistic about Transcorp Hotels knowing the stock has accrued 5 percent over the past four-week period.
The stock has traded a total volume of 7.99 million shares—in 5,154 deals—valued at N1.72 billion over the period, with an average of 126,871 traded shares per session.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
