Reviewing Transcorp Hotels’ consistent shareholders value delivery

It is anybody’s guess why shareholders and other stakeholders associated with Transcorp Hotels Plc (“Transcorp Hotels” or “the Company”) (NGX: TRANSCOHOT) are rooting for the expansionist drive by the management. For the shareholders who have had the benefit of hindsight and foretaste of what to expect in the event of a boom, as has been the case with the business in recent years, are ready to stake a bet that the expansionist drive of the Mrs Uzoamaka Oshogwe management-led team would indeed bear fruit and good yields.

A cursory review of the hotels’ fundamentals shows a growth trajectory over time and suggests one thing: things are indeed looking up for the hospitality subsidiary of Transnational Corporation Plc, with the hospitality segment driven by Transcorp Hotels Plc, owner of Transcorp Hilton Abuja and other premium hospitality assets. For instance, Transcorp Hotels Plc reported historic revenue of N97.04bn in 2025, which is 38 per cent higher than N70.13bn in the previous year, as indicated in the audited financial reports of the company filed with the Nigerian Exchange Limited.

As of today, the hospitality business is one of the companies on the NGX with a market capitalisation of over N2 trillion.

In FY 2025, Transcorp Hotels maintained a competitive edge over Ikeja Hotel, an equally listed hospitality company. This was driven by larger revenue, better profitability, and premium assets. Owning Transcorp Hilton Abuja grants access to high-end clients, diverse revenue sources, and higher pricing power, leading to better margins and stability. Its bigger assets and brand strength offer operational leverage, helping manage costs and remain resilient during demand changes. Compared to Ikeja Hotel, Transcorp Hotels shows higher capital efficiency and earnings capacity, solidifying its status as Nigeria’s leading hospitality company.

In the period under review, the company’s record revenue of N97.04bn was driven by robust demand in room bookings, conferencing, food and beverage services, and other ancillary service offerings. Its gross profit margin expanded to 77 per cent from 71 per cent in FY 2024, driven by increased volumes, effective cost management, and operational efficiencies.

Operating profit hit N35.24bn, up 35 per cent from N26.03bn in 2024. Profit before tax rose by 45 per cent to N32.82bn from N22.61bn in FY 2024. Similarly, profit after tax rose to N21.85bn from N14.90bn, marking a 47 per cent year-on-year increase.

In a statement accompanying the report, the Board Chair, Transcorp Hotels Plc, Dr Awele V Elumelu, OFR, said, “I am delighted with the FY 2025 performance of Transcorp Hotels Plc, led by Mrs Uzoamaka Oshogwe. We have continued to strengthen the foundation of our company, with our growing asset base and equity increasing by 14 per cent and 18 per cent, respectively, positioning us for the future. We will continue to be focused on driving operational excellence and business growth, whilst exploring new avenues for sustainable long-term value creation for all.”

Managing Director/Chief Executive Officer, Transcorp Hotels Plc, Uzoamaka Oshogwe, added, “Our full-year 2025 performance represents a major milestone, with record revenue of N97.04bn and retained earnings rising sharply from N63.23bn in FY 2024 to N77.53bn, further enhancing our financial resilience and long-term growth capacity. Our success results from disciplined operational efficiency, strong cost management, and most importantly, our exceptional team’s commitment to service excellence.”

“Guided by a bold, future-focused vision, we continue to invest in transformative infrastructure, notably the 5,000-seat world-class Transcorp Centre, positioning Nigeria as a premier global convening destination for high-profile events, including the Afreximbank Annual Meetings, ECOWAS Summits and many more. Looking ahead, we will continue to innovate and leverage cutting-edge technology to strengthen our brand and redefine hospitality standards across Africa.”

On its balance sheet, the total assets of Transcorp Hotels hit N159.91bn, representing a 14 per cent increase from N140.70bn in 2024, reflecting substantial investments in physical facilities supporting its future growth trajectory. Its total equity increased to N95.23bn from N80.52bn.

Expectedly, when the management convened for its annual general meeting at the Congress Hall of the Transcorp Hilton Abuja last month, the shareholders swiftly approved a dividend payout of N13.3 billion for the 2025 financial year, equivalent to N1.30 per share. The N13.3 billion payout, the highest in over a decade, combined a N0.10 interim and N1.20 final dividend for 2025, surpassing the previous year’s N1.00 per share final payout.

Shareholders also commended management for the company’s continued improvement in financial performance over the years.

An elated Chairman of Transcorp Hotels Plc, Dr Elumelu, said 2025 was a strong year, with revenue rising by 38 per cent to N97 billion, up from N70 billion in the preceding year. She attributed the growth to a combination of elevated service standards, higher demand for food and beverage offerings, and a focus on service excellence that drove repeat business.

Advertisement

Despite inflationary pressures, the company maintained strong profitability, with Profit After Tax (PAT) rising by N32.8 billion, representing a 45 per cent year‑on‑year growth, signalling both revenue strength and improved operational efficiency.

Looking ahead to 2026, Dr Elumelu said the company remains focused on developing a new hotel in Lagos–Transcorp Hotels Ikoyi–a flagship five‑star property aimed at revolutionising high‑end accommodation and premium guest experience in the city.

She acknowledged that geopolitical tensions and macroeconomic uncertainties could pose challenges, but expressed confidence in a positive long‑term outlook for the hospitality industry.

Echoing similar sentiments, the Managing Director/Chief Executive, Mrs Oshogwe, said the company is partnering with Transcorp Power to explore cheaper power options and reduce energy costs. She said one of the key initiatives introduced toward the end of 2025 was the dual gas burner system, which uses gas to power all boilers across the 667 rooms at the Transcorp Hilton. This system not only cuts costs but is also more environmentally friendly.

Oshogwe also said the company is working with Transcorp Energy on renewable energy solutions as part of its broader Environmental, Social and Governance (ESG) strategy. For 2026, the MD outlined three core priorities, including: Revenue growth: directing limited funds into projects with strong capital appreciation and a multiplier effect on revenue; Operational excellence: investing in staff and technology to strengthen service delivery and efficiency; and brand relevance: ensuring the market clearly understands what the Transcorp Hotels brand stands for and how it aligns with sustainable operations.

Shareholders received and approved the audited financial statements for 2025 and the reports of the Directors, Auditors and Audit Committee.

At the AGM, Dr Awele Elumelu’s appointment as a Director of the company was ratified, while Garba Abubakar and Adesimbo Bello‑Ukiri were re‑elected to the Board after retiring by rotation. The following shareholders were re‑elected to the Audit Committee: Obot Akaninyene, Eric Akinduro and Erinfolami Gafar, while the Board’s representatives on the Audit Committee were re‑appointed as Bolanle Onagoruwa and Garba Abubakar.

Commenting on the company’s performance, shareholders expressed largely positive sentiments at the AGM.

National chairman of New Dimension Shareholders Association of Nigeria, Patrick Ajudua, expressed satisfaction with the dividend payout and urged management to maintain cost optimisation as the country approaches the 2027 election cycle.

On her part, the national coordinator of Pragmatic Shareholders Association of Nigeria, Bisi Bakare, noted that the N1.30 dividend accounted for nearly 50 per cent of the company’s earnings per share and commended the board for returning value to shareholders.

Another shareholder, Kabir Abdullahi, welcomed both the dividend and the share price appreciation from below N30 to nearly N200, and expressed expectations of future interim payouts as well as strong performance from related entities such as Transcorp Power Plc.

In a monitored television magazine programme on TVC, Business Nigeria, Mrs Oshogwe shed more light on the facts behind the figures. Speaking on how the hospitality brand navigated economic headwinds, she said, “What we do at Transcorp Hotels Plc is that we plan, we are not reactive. As a business, we understand that the business climate changes and we put in place strategies that will continue to deliver value to our shareholders.”

While commenting on the company’s Environmental, Social, and Governance (ESG) framework, she said it is not just a slogan, but something embedded in its entire operations as an ideal. “Starting from our environment, we do good business, and we ensure that we do clean business. That means, for example, if you look at our energy space, we ensure that apart from using diesel, we also have other alternatives; we are working very closely with our sister company Transcorp Energy to explore other alternative energy and renewable energy.”

Expatiating, she said, “Also, around the socials, we ensure that we patronise local farmers and engage local skills as well. So, wherever we do business, we ensure that we develop the environment where we are working. And, for good governance, our Board chairperson, Dr. Elumelu is big on transparency, integrity and ensuring that good governance is what drives everything that we do. So, these are the highlights of our Environment, Sustainability Governance ESG. For us, it’s not a slogan; it’s everyday living for us, and that’s how we operate.”

As to how the macroeconomic challenges, like the FX volatility, affected some of the company’s projections, she offered a plausible explanation. “For us, in 2025, the environment can be hostile sometimes but we’re well prepared. For example, last year, we sweated all our assets. Strategic partnership, cost efficiency, value addition to the customers and ruthless execution of our strategy.”

Advertisement

Beyond 2025, she is optimistic that the growth trajectory of the company will keep accelerating. “We placed our strategy on three pillars: focus on where we put our money or focus on capital allocation by ensuring that every single investment that we make, whether in terms of revenue, turnover from that investment, must surpass the cost of capital. So we’re not reckless about our investments. We ensure that returns make sense. It’s also about operational excellence; you can’t underestimate that in anything that you do. We also focus on our brand by ensuring that our employees are proud of the brand and that our investors trust not just short term but for the long term. So, with these three principles there is nowhere else to go but the top.”