April 14, (THEWILL) – Transcorp Hotel Plc (a subsidiary of Transnational Corporation Plc) experienced a strong year in 2024, with significant topline and bottom-line increase, as well as improved financial leverage.
Transcorp Hotels reported a record revenue of N70.13 billion, a 69 percent increase from 41.46 billion in 2023, along with a 144 percent surge in post-tax profit to N14.90 billion from a relatively paltry N6.09 billion in the preceding year.
The hospitality giant also recorded a similar growth trajectory in its pre-tax profit with a 138 percent increase from a far lower N9.48 billion in FY 2023 to N22.61 billion in the review period.
Consequently, the 11.57 percent expansion in its balance sheet with a robust assets base of N140.60 billion from N126.09 billion in FY 2023 reflected an improved gearing ratio.
This saw the debt-to-equity ratio decrease from 17.48 percent in FY 2023 to a 9.30 percent in 2024, on consistent principal repayment of third-party loans.
This resulted in a flat movement in finance cost to N4.34 billion in FY 2024 from N4.23 billion in the preceding year. Interest on debts and borrowing decreased from N3.11 billion in the preceding period to N2.79 billion in 2024 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 N29.03 billion in the review period against N14.75 billion in FY 2023 – constituting a 98.81 percent.
Interest on inter-company loan payable rose marginally to N1.42 billion against N1.00 billion in FY2023.
Overall, the foremost hospitality industry leader achieved an improved cost-income ratio of 21.24 percent during the review year as return-on-assets increased from 4.83 percent in FY 2023 to 10.59 percent in FY 2024.
Similarly, return-on-equity grew from 9.12 percent in FY 2023 to 18.50 percent in FY 2024 period, indicating efficient income generation from equity, as the N10.1 billion dividend declared for the 2024 full year, constituting N1,00 per ordinary share, is set to excite shareholders.
The expanding business activities, rising energy cost and the effect of the naira devaluation culminated in the increase in operating expenses which rose by 68.28 percent to N29.03 billion in FY2024 against N17.25 billion in the preceding period.
Major expenditure windows include Energy cost which increased to N4.76 in the review period from N2.42 billion in FY2023 constituting an increase of 96.6 percent. Employee cost during the year rose to N4.72 billion against N2.477 billion prior in 2023.
A financial analyst, Gab Omoruyi, said the boom in the hospitality industry and the devaluation of the naira “led to significant increase in the volume of the naira which enabled the debtors to offset their commitments to the firm”. He also alluded to the favourable macroeconomic environment of the services sector which reflected in the impressive performance of the hospitality industry.
According to the National Bureau of Statistics, the Services sector has driven the gross domestic product (GDP) growth of the economy for a long time, incorporating improvement in Tourism and Hospitality.
The Services sector recorded a 5.37 percent growth, the highest in the economy in Q4 2024 according to NBS and contributed 57.38 percent to the aggregate GDP during the period.
In 2024, Transcorp Hotels generated N31.86 billion from room sales, a significant increase from N18.98 billion in the previous year, highlighting a strong performance in this area.
“Transcorp Hotels saw a substantial increase in revenue from room sales, reaching N31.86 billion in 2024, up from N18.98 billion in the corresponding period of the previous year. This suggests a strong impact of the Services sector, during which the company’s overall revenue also experienced significant growth, with a record revenue of N70.13 billion in the 2024 fiscal year, representing a 69 percent increase,” Omoruyi said in a note to THEWILL.
Besides room sales, Transcorp Hotels also saw increases in revenues from food and beverages -N6.73 billion, as well as shop rentals.
“These are behind the company’s pre-tax profit which also saw a substantial increase, rising by 138 percent to N22.6 billion in 2024,” he added.
The strong performance of Transcorp Hotels pushed it into the trillionaire club at the Nigerian Exchange (NGX) in 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 said.
Regarding its stock market performance, Transcorp Hotels closed its last trading day (Friday, April 11, 2025) at N145.00 per share on the Nigerian Exchange (NGX). Transcorp Hotels began the year with a share price of N116.00 and has since gained 25 percent on that price valuation.
Analysts said shareholders can be optimistic about Transcorp Hotels knowing the stock has accrued 15 percent over the past four-week period.
The stock has traded a total volume of 13.1 million shares—in 2,874 deals—valued at N1.72 billion over the period, with an average of 207,375 traded shares per session.
A volume high of 8.86 million was achieved on March 21st, and a low of 2,584 on March 20th, for the same period.
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.
