Transcorp Power’s foreign revenue doubles but credit risk costs jump 78%

TRANSCORP Power Plc earned N117.047 billion from international customers in full-year 2025, representing more than double of N54.681 billion generated in 2024, according to the energy company’s 2025 annual report posted on the Nigerian Exchange (NGX) on Friday.

The report shows that the company’s earnings from foreign customers represent a 114.06 percent increase in revenue made from them in 2024. This segment of Transcorp’s market constituted a 29.4 percent of the revenue in 2025.

However, local customers are kings, earning N281.221 billion in 2025, constituting 70.6 percent of the total revenue (N398.268 billion) obtained in 2025. Hence local customers grew their revenue by 12 percent in 2025, from N251.263 billion reported in full-year 2024.

“The Company is in the business of generation and sale of electric power. The company also provides ancillary services of black start service to Transmission Company of Nigeria (TCN). Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services,” the company said in the financial statement.

“The Company has generally concluded that it is the principal in its revenue arrangements. Revenue is earned overtime in line with the continuous generation of power from the company’s generating plant. At contract inception, the Company assesses the goods or services promised to a customer and identifies as a performance obligation each promise to transfer to the customer either a good or service (or a bundle of goods or services) that is distinct; or a series of distinct goods or services that are substantially the same and that have the same pattern of transfer to the customer.”

Transcorp Power is a subsidiary of Transcorp Plc. Mr Peter Ikenga is the managing director & CEO of the company. Mr Emmanuel Nnorom is its chairman.

Credit risk losses

Similarly, the energy company set aside N27.612 billion for losses that might have arisen from default. Transcorp considers a financial asset to be in default when contractual payments are 90 days past due. In addition, a financial asset may be deemed in default earlier if internal or external information indicates that the company is unlikely to recover the outstanding contractual amounts in full, before considering any credit enhancements.

Credit risks generally impact profits, especially if large. It may also make investors cautious, making quoted profits less reliable.

“Given the historical payment patterns and settlement processes of our customers, the 90-day threshold is considered appropriate for determining default. This policy also applies to related party receivables.

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“Specifically, NBET receivables have been assessed as impaired due to persistent delays and elevated credit risk. The Company has recognized an expected credit loss (ECL) allowance in accordance with IFRS 9, reflecting the probability-weighted outcome, time value of money, and reasonable and supportable information about past events, current conditions, and forward-looking economic factors. There was no impairment loss on the unbilled receivable because it was not yet invoiced and not due at the reporting date.”

Hence the company set aside N27.612 billion for such credit losses in 2025 as against N15.471 billion earmarked in 2024, representing 78 percent increase over the one-year period.

Revenue, profit growth

The company’s revenue rose to N398.27 billion in full-year 2025, from N305.94 billion reported in the previous year. Gross profit increased by 14 percent to N162.44 billion, compared with N142.21 billion in 2024, while profit after tax grew to N91.42 billion from N80.01 billion in 2024.

Also, Transcorp Power recorded significant balance sheet growth, with total assets up by 42 percent to N563.48 billion from N396.78 billion in 2024. Shareholders’ equity expanded by 44 percent to N183.40 billion, while total short- and medium-term borrowings declined to N30.7 billion from N37.7 billion in 2024, underscoring the company’s focus on reducing leverage.

“We remain dedicated to improving lives and transforming Africa, ensuring operational excellence and making strategic investments that deliver long-term value to our shareholders, while also powering Nigeria’s socioeconomic growth,” Chairman of Transcorp Power, Mr Emmanuel Nnorom, said.