Transnational Incorporation of Nigeria Plc (Transcorp) has posted a decline of 52.51 per cent in its profit after tax for 2014 financial year end.
According to the company result posted on the Nigerian Stock Exchange (NSE), the group profit after tax went down from N6.957 billion to N3.304 billion in 2014.
The report which showed that the major cost items that contributed significantly to the reduction in profit line are cost of sales, administration expenses and finance charges. Finance charges grew by 207.7 per cent as a result of the increased borrowings of N10.64 billion.
However, the company reported a 119.6 per cent growth in revenue to N41.34 billion from N18.83 billion in 2013. Conversely, net income dropped by 52.5 per cent to N3.30 billion from N6.96 billion in 2013.
The company equally made a provision of N11.59 billion in the period which was used up to re-capitalise its fixed assets as indicated in the statement of cash flow account. Organically, the fixed assets position of the company soared to N93.52 billion which financial analysts think has helped to strategically position Transcorp to take advantage of potentials in its lines of business.
According to analysts at GTI Capital Limited, “Despite the fact that a lower profit line was reported, we think it is not a weakness in the company’s operations especially when we consider the rate of growth logged by the top line indicator.
“Also, the company board of director proposed a dividend of 6 kobo per share, a 20 percent growth over 5 kobo paid in 2013. The qualification date for this incentive elapses after trade on April 21, 2015 and payment will be made on May 11, 2015”.
Speaking recently, the chief executive officer of Transcorp, Mr. Emmanuel Nnorom said, “Our third quarter 2014 results underscore our determination to achieve our full year 2014 targets. Our commitment to excellence is evident in the significant achievements we have recorded this year in our power and hospitality businesses”.
Source : Leadership