NSE-listed hotel chain TPS Eastern Africa has issued a profit warning for the financial year ending December 31, 2025, citing an expected decline in after tax profit primarily due to unrealized foreign exchange gains, security issues, and increased provisions on outstanding receivables.
Following the stability of the Kenyan Shilling during the review period foreign exchange gains recognised in 2024 on revaluation of foreign currency denominated loans and lease liabilities are not expected to occur in FY 2025.
Despite efforts by TPS Eastern Africa Plc to bridge the shortfall arising from reduced exchange gains, regional insecurity and related travel advisories have adversely affected performance, leading to booking cancellations and higher provisions on outstanding receivables in line with IFRS 9 requirements.
TPS Eastern Africa FY 2024
In the FY 2024 TPS Eastern Africa Plc saw its revenue grow 5.2% to KES 10.2 billion from KES 9.7 billion in the year ended December 2023. EBITDA eased 3.2% to KES 2.4 billion, while net profit surged by 188% to KES 1.32 billion from KES 457.5 million recorded in the previous year. Meanwhile the firm’s asset base contracted marginally by 1.5% to KES 20.2 billion. The company declared a dividend of KES 0.35 per share, its first payout since 2018.
Our outlook
The hospitality and tourism conglomerate noted that it will continue to implement measures to safeguard shareholder value, protect market share, enhance brand value through enriched guest experiences, ongoing product upgrades and embracing new technology.
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