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Ikeja Hotel’s quarterly profit soars more than 28-fold to N604m

Ikeja Hotel’s quarterly profit soars more than 28-fold to N604m

The earnings of Ikeja Hotel Plc jumped more than 28-fold in the first three months of this year, BusinessDay analysis of its financial statement shows.

The firm’s after-tax profit rose to N604.1 million from N22.9 million in the first three months of 2023. The hotel reported a revenue of N8.89 million, up from N2.1 million.

Further analysis reveals that revenue growth was driven by rooms, which contributed N2.72 billion to the total revenue, followed by food and beverage with N1 billion, miscellaneous income (N163.9 million), and minor operating departments (N6.6 million).

Read also: Ikeja Hotel profit jumps 230% despite headwinds

The company’s cost of sales rose to N2.22 billion from N1.51 billion while other income declined to N1.46 billion from N58.9 billion.

The hotel’s sales and distribution expenses surged to N153 million from N80.3 million while administrative and general expenses also grew to N556.4 million from N285.5 million.

Finance income grew to N207.6 million from N89.8 million while finance costs rose to N330.4 million from N293.9 billion.

The firm’s current tax expense grew to N241.4 million from N16.5 million.

Cash and cash equivalent at the end of the period rose to N17.6 billion from N10 billion.

Movement in cash and cash equivalent reveals that net cash from operating activities grew to N3.08 billion from N375.03 million. Net cash flows used in investing activities stood at a positive of N192.7 million from a negative of N195.3 million.

Net cash flows used in financing activities stood at a negative of N330.4 million from a positive of N1.6 billion.

Read also: Ikeja Hotel appoints Kemi Adeoye as non-executive director

Trade receivables surged to N1.22 billion in March 2024 from N1.03 billion in December 2023. Prepayments increased to N235.2 million from N215.5 million.

Inventories increased to N303.2 million from N251.4 million, driven by food and beverage of N237.5 million, and operating supplies of N65.7 million.

Ikeja Hotel is a hotel development and management company with direct or indirect ownership of Sheraton Lagos Hotel, Sheraton Abuja Hotel, and Federal Palace Hotels & Casino. The company targets the leisure, business, and convention markets in Opebi, Ikeja, and Lagos.

Its principal business is the provision of services in the hospitality industry, including the development of other tourist facilities. It has continually expanded its participation in Nigeria’s hospitality industry through the development and acquisition of hotel and tourist facilities.

In 2002, Hans-Gremlin (Nigeria) Limited, a subsidiary of Ikeja Hotel, acquired a 51 percent equity stake in Capital Hotels Plc (owners of Sheraton Abuja Hotel) under the privatisation programme of the Federal Government of Nigeria. This acquisition firmly consolidated the leading position of Ikeja Hotel Plc, in the nation’s hospitality industry.