The hospitality industry favours Transcorp Hotels as revenue reported by the company in the nine months (9M) period that ended September 2022 hit the highest in 9 years.
Revenue grew by 55.14 percent in the nine months period ended September 2022 to N22.65 billion from N14.60 billion in the corresponding period of 2021.
The growth reported by the hotel company can be attributed to the 118.9 percent surge in its food and beverage revenue-generating segment which grew to N8.67 billion in 9M’2022 from N3.96 billion in 9M’2021, thereby accounting for 38 percent of the total revenue reported in the period.
Its food and beverage revenue-generating segment grew by 40.6 percent to N12.98 billion in 9M’2022 from N9.23 billion in 9M’2021.
As revenue grew, so did profit. In the 9 months period ended September 2022, Transcorp reported a 205.9 percent surge in profit to N2.27 billion from N742 million in the same period of 2021.
Consequently, the profit margin grew by 494 basis points to 10.02 percent in September 2022 from 5.08 percent in September 2021.
The firms’ cost of sales grew by 66.3 percent to N6.27 billion in September 2022 from N3.77 billion in September 2021, with rooms, and food and beverages accounting for 51.8 percent and 46.1 percent of the total cost of sales in the period.
Interest on debts and borrowings drove finance costs to N3.07 billion in September 2022, down from N3.09 billion in September 2021.
Transcorp’s other operating income was down by 46 percent to N475 million in 9M’2022 from N884 million in 9m’2021.
Its operating expenses, however, grew by 33.38 percent in the 9 months period that ended September 2022 to N10.51 billion from N7.88 billion in the corresponding period of 2021.
The results also showed that total assets grew by 1.26 percent to N116.83 billion in September 2022 from N115.38 billion in September 2021.
In the same vein, total shareholder’s funds grew by a steep 3.14 percent to N63.78 billion in September 2022 from N61.84 billion in September 2021.
Cash and cash equivalents, however, were down by 49 percent to N2.29 billion in September 2022 from N4.49 billion in September 2021.
Net cash flow from operating activities surged by 298 percent to N6.93 billion in September 2022 from N1.74 billion in September 2021, thereby indicating that the firm is generating enough cash from its operations.
Its net cash from investing activities during the period was negative, totaling N2.99 billion in September 2022 from N-452 million in September 2021. This is largely due to the N2.99 billion and N12.77 million spent on the purchase of property, plants, equipment, and intangible assets respectively during the period.
Net cash flow from financing activities in the 9 months period ended September 2022 amounted to N-4.79 billion, lower than N1.52 billion reported in the same period last year.
During the period under review, Transcorp repaid borrowings amounting to N1.67 billion, paid interests of N2.41 billion, and dividends of N717 million.
Transcorp Hotels reported earnings per share of N23 per share in the nine months period ended September 2022.