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High-income tax slows Transcorp’s profits by 29%

High-income tax slows Transcorp’s profits by 29%

Despite posting its highest profits in five years, Transcorp, one of Nigeria’s leading conglomerates, has reported a 29 percent decline in profit after tax to N16.8 billion in 2022.

The above development represents an N6.99 billion drop for the fiscal year that ended in December 2022.

Further findings showed that the decline was attributed to current tax expenses which had a 94 percent increase to N6.3 bn in 2022; deferred tax expenses also recorded a 689.9 percent increase to N7.0 billion in 2022 from N0.89 billion recorded in 2021.

Profit after tax recorded in 2022 was N16.83 billion from N23.8 billion recorded in the year ended 2021, while profit before tax recorded an 8.1 percent increase to N33.28 billion at the end of the financial year 2022 from N 27.99 billion recorded in 2021.

The Group’s revenue rose by 21.13 percent to N134.72 billion in 2022 from N111.22 billion in 2021; gross profit grew by 17.52 percent closing the year with N66.42 billion in 2022.

The firm’s operating profit increased by 21.2 percent to N46.7 billion in 2022 from N38.53 billion while operating expenses stood at N22.7 billion, an increase of 20.7 percent compared to N18.8 billion in 2021.

Finance income declined 58.68 percent to N117.330 million from N283.9 million recorded in 2021.

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Total equity rose to N154.8 billion, representing a 6 percent year-on-year increase from N146.3 billion recorded in the same period of 2021.

The results showed that total assets increased by 6.4 percent to N442.7 billion in December 2022, from N416 billion in December 2021, with current assets increasing to N101.87 billion recorded in 2022 from N88.26 billion recorded in 2021.

Cash and cash equivalent also saw a decrease of 49 percent to N5.48 billion recorded in 2022 from N10.76 billion in 2021.

The company which has a considerable presence in the Hospitality, Power, and Oil and Gas sectors, recorded growth in its profit before tax, which rose by 32.7 percent to N33.3 billion compared to N25.1 billion in December 2021.

The conglomerate saw a 15 percent increase in its Power investments, to N103.28 billion in 2022 from N89.47 billion recorded in 2021

The hospitality sector also saw an increase of 44.6 percent increase to N31.4 billion from N 21.7 billion recorded in 2021.

According to its financials, the board of directors approved payment of N2.03 trillion in 2022 from N0.813 trillion recorded in 2021, being 5 kobo per share on the outstanding shares of 40.65 trillion shares of 50 kobos each for the year ended 31 December 2022.