Transcorp Power Plunges by 10% despite Thin Trading Volume
Transcorp Power Plc lost about 10% of its market value on the Nigerian Exchange (NGX) after moderate shares exchange hands.
The power generating Company that was recently listed in the equities market has seen successive price appreciation earlier in the local bourse before it hit pause button.
Data from the Nigerian Exchange showed that Transcorp Power Plc share price declined by 9.9% to N335.2 at the close of trading session on Friday, from N372.4 at the beginning of the week.
The price decline was triggered after investors traded 130,393 shares of Transcorp Power Plc at the beginning of trading sessions last week in the market.
The company’s share movement has remained tight even with 7.5 billion shares outstanding, majority of which are in few hands after it’s listed by introduction.
The company’s value has fallen by more than 13.25%, trading below its highest market price of N386.40 in the local bourse.
EARNINGS
Transcorp Power Plc grew its profit after tax by 233% to N32.77 billion in the first half of 2024 from N11.043 billion in the comparable period in 2023, following a sharp revenue growth.
Its stronger earnings growth was boosted by a significant reduction in net finance costs. In the first half, Transcorp Power net finance cost reduced by 96.7% as interest income growth eclipsed interest expenses.
The company also recorded foreign exchange gains of N1.10 billion, reversing loss of N4.73 billion sustained in the first half of 2023.
In the period, sales revenue from contracts with its customers grew by 142% year on year, from N55.9 billion in the first half of 2023 to N135.4 billion 12 months later.
Further review showed a sharp increase in income from capacity charges and energy delivered.
Revenue generated from capacity charges climbed by about 119% year on year to N42.065 billion in 12 months from N19.243 billion in the first half of 2023.
FUNDING
Transcorp Power has a total shareholder equity of N94.634 billion and short plus long term borrowings of N47.6 billion, which brings its debt-to-equity ratio to 50%.
Its short term borrowing totalled N186.64 billion as of June, 2024 represent a significant increase from N125.576 billion in the comparable period in 2023.
It has a long term exposure total N41.709 billion in the first half of 2024, up by 7% year on year from N38.95 billion 12 month ago.
The power generating company had settled $215 million acquisition loan obtained to acquire 100% interest in Ughelli Power Plc in January 2024. This has helped free its cash flows from obligation arising from borrowings.
ACQUISITION
Transcorp Plc has a 5% shareholding in Afam Power Plc and a 15% shareholding in Joelan. Joelan owns 60% of Abuja Electricity Distribution Company (AEDC). #Transcorp Power Plunges by 10% despite Thin Trading Volume
