Nigerian government’s quarterly revenue generated from the train operation will take a hit in the third quarter of 2022, as the Nigeria Railway Corporation (NRC) suspends operation on the Lagos-Kano and Ajaokuta routes.
The NRC had often generated above N868 billion in the third quarter for the past three years, posting N868.3 million in Q3 2019, N868.3 million in the same quarter a year after.
The turnover skyrocketed to N1.9 billion between July to September last year, solidifying the third quarter as the best revenue generating period for the Nigeria Railway Corporation.
However, the revenue growth recorded during the period will slow down this year, as insecurity has forced the NRC to suspend train operation on Lagos-Kano and Ajaokuta routes.
According to the corporation on Wednesday, the increased insecurity had compelled the government to halt Lagos-Kano route, while the recent attack on passengers on Ajaokuta lane, which is within the Warri-Itakpe route had contributed to the suspension.
This is the third revenue generating routes that will be shutdown due to insecurity, after the March 28 attack by bandits on Abuja-Kaduna passengers, also resulted to the closure of the lane that grosses at least N300 million monthly.
Impact on Q3 turnover is expected to further slow total NRC earnings in 2022, a year after revenue from train operation rose significantly by 199% in 2021, when N6.08 billion was generated, surpassing the N2 billion of 2020.
Passenger volume will also take a hit this year, after over 2.71 million passengers travelled through railway last year, in contrast to the 1.02 million passengers reported in 2020.
The revenue losses comes at a period the Federal Government is struggling to grow its earnings, which fell behind debt servicing fee in the first quarter of 2022. Ripples Nigeria had reported that FG generated N1.63 trillion in Q1 2022, while debt servicing stood at N1.94 trillion in the same period.
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