ABC Transport Plc made a strong recovery in 2024, posting a pre-tax profit of N918.4 million, compared to a loss of N368.6 million in 2023, as revenue increased across all business segments.
The group’s gross profit rose to N2.87 billion, up 72.5% from N1.6 billion in the previous year, despite a 70.2% increase in costs.
This improvement was driven by a 70.7% surge in revenue, which reached N12.5 billion, strong enough to offset rising expenses and boost gross profit.
All business segments of ABC Transport recorded revenue growth in 2024, laying the foundation for bottom-line profitability.
However, a more in-depth look at the company’s business segments and their contributions to profitability is vital.
Business segments
A closer look at ABC Transport’s business segments reveals that the cargo division led the charge in both revenue and profit.
- It brought in N4.09 billion in revenue, a significant jump from N2.4 billion in the previous year.
- Even with expenses reaching N3.9 billion, the segment still managed to deliver a pre-tax profit of N349.9 million.
Haulage was the next at N2.94 billion, double the N1.2 billion reported the previous year.
- Despite an expense of N2.71 billion, it managed to make a pre-tax profit of N234.5 million.
Not all segments, however, performed at the same level.
- The Shuttle and City Transit Intercity (CTI) services recorded much smaller revenues, N356.3 million and N355.1 million, respectively.
- While CTI managed to turn in a modest profit of N68.2 million, the Shuttle service struggled under an operating expense of N518.1 million, resulting in a loss of N87.6 million.
When looking at revenue sources more broadly, load and waybill activities emerged as the company’s top revenue generator at N4.1 billion.
- Haulage operations came next, with revenue growing by 142.9% year-on-year to N2.9 billion.
- Transport earnings came in at N2.6 billion, while Vehicle and spare parts sales contributed N2.4 billion.
- Hospitality services added N355.1 million.
While the growth in revenue laid a solid foundation for the group’s return to profitability, a key internal adjustment helped ensure those gains translated into bottom-line earnings, marking a shift from the challenges of the previous year.
Other operating income:
In 2024, ABC Transport made a key adjustment to its other operating income, which played a significant role in supporting bottom-line profitability. The company recorded income of N462.5 million, reversing a loss of N57.16 million from the previous year.
- A major driver of this rebound came from franchise, which contributed the largest portion at N261.2 million, representing a growth of 201.3%.
- Insurance indemnity followed, rising sharply to N91.4 million from just N7.4 million in 2023.
- Income from training activities also made a meaningful contribution, totaling N68.7 million.
- Other sources of income included rent at N17.2 million, sales of scrap at N15.1 million, and exchange gains of N4.4 million.
Together, these income streams totaled N462.5 million, providing crucial support against a 26.4% rise in administrative expenses. This stands in contrast to the previous year, when such support was absent.
Rising administrative expenses, strong operating profit
ABC Transport continued to face rising administrative expenses in 2024, reaching N2.2 billion, up 26.4% from the N1.7 billion reported in 2023, which itself is a 44.52% increase from the year before.
Breaking down the expenses, exchange losses made up the largest chunk at 26%, totaling N586.2 million.
- Personnel expenses followed at N351.6 million, with transport expenses close behind at N177.1 million.
- General expenses and electricity costs also contributed significantly, coming in at N134.7 million and N103.4 million, respectively.
Despite these growing costs, other operating income, which already stood at N462.5 million in 2024, helped absorb much of the impact.
As a result, ABC Transport recorded a healthy operating profit of N1.3 billion, a strong improvement over the N40.2 million reported in 2023.
- Hence, even with a finance cost of N465.9 million—up 13.98%—the company still posted a pre-tax profit of N918.4 billion, rebounding strongly from the previous year’s loss.
