Profit at Transcorp Power Plc is expected to soar to N114 billion in 2026, driven by increased generation capacity and stronger energy output. The company's profit after tax is projected to rise to N113.8 billion in the 2026 financial year, up from N91.4 billion recorded in 2025. This growth outlook is supported by a planned increase in available capacity to 750 megawatts from 550 megawatts currently.
The company's robust 2025 performance saw revenue jump 30 percent year-on-year to N398.3 billion, driven by an expansion in generation capacity to 550 megawatts from 417 megawatts after the rehabilitation of a key gas turbine unit. Energy-delivered revenue surged nearly 43 percent to N293.9 billion, reflecting stronger dispatch volumes, while capacity-charge revenue posted modest growth.
Analysts at Meristem expect revenue growth of about 26 percent to N503.1 billion in 2026, driven by the planned capacity ramp-up. A strategic gas supply partnership between parent Transnational Corporation and Heirs Energy is also seen as bolstering the reliability of fuel supply, a critical factor for thermal generation companies.
The analysts are optimistic about Transcorp Power's prospects, noting that stronger revenue performance will offset cost intensity and help maintain stable profit margins. They also expect the anticipated bond-backed settlement of GenCos' receivables to improve liquidity and cash conversion significantly.
However, profitability gains may remain constrained by elevated input costs, including gas prices that rose sharply in 2025 to an average of $3.52 per MMBtu from $2.26 a year earlier.
Transcorp Power's projected profit growth is a welcome development for the Nigerian power sector, which has been plagued by persistent cost pressures. The company's planned capacity expansion and strategic gas supply partnership are expected to drive revenue growth and improve profitability. However, the sector's liquidity constraints remain a key concern, with trade receivables rising significantly in 2025. The proposed bond-backed settlement for generation companies' outstanding receivables could materially improve cash flows across the sector if implemented. For Transcorp Power, this could accelerate deleveraging, moderate finance cost pressures, and strengthen earnings quality.
