Chairman, board of directors of Transnational Corporation Plc, Mr Tony Elumelu has urged the federal government to expedite action in the payment of the over N2 trillion owed to power generation companies (GenCos) by the Nigerian Bulk Electricity Trading Plc (NBET) to sustain the reliable flow of electricity from the GenCos. He said the distortion in the liquidity flow in the sector is huge and typified by the debt owed to GenCos.
Elumelu said the GenCos are subsidising the sector by continuing to generate power despite the huge debts owed to them.
“We are owed N250 billion as of March 2024”, Elumelu said at the 18th annual general meeting of Transcorp Group yesterday in Abuja.
He said the lack of liquidity flow into the sector had impacted negatively on the ability of the GenCos to pay their gas suppliers, thereby impacting the quantity and reliability of gas supply to the GenCos, as well as investment in generation.
“I, therefore, welcome recent pronouncements by the federal government of Nigeria affirming its commitment towards paying the debt owed to the GenCos. I urge speedy implementation of actions necessary to translate the pronouncements to achievements”, he stated.
The chairman of Transcorp Plc also called for full privatisation of the power sector. To enable the sector to be efficiently run by the private sector, he recommended that the federal government come out with a clear timeline for the full privatisation of the power sector, starting with the DisCos and Transmission Company of Nigeria (TCN).
Only a partial privatisation of the power sector has been achieved since the privatisation exercise commenced in 2012. Despite the privatisation exercise, the federal government still owns 100 per cent of TCN and 40 per cent of DisCos, and also holds ownership interests in some GenCos.
Transcorp’s gross earnings for the year-end 2023 grew by 47 per cent from N134 billion reported in 2022 to 197 billion, while profit before tax increased by 94 per cent from N30 billion in 2022 to N59 billion in 2023.
The group shareholders’ funds grew by 21 per cent from N155 billion to N 187 billion, driven by retained profit for the period.
Total assets increased by 20 per cent to N530 billion, driven by growth in operating revenue and cash flow. However, total liabilities increased by 19 per cent, from N288 billion to N343 billion during the year.
“This success was driven by significant investment, which resulted in robust growth in our power and hospitality businesses”, Elumelu stated.
