Ikeja Hotels commits to repositioning as tourism, hospitality industry leader
Adesola Afolabi was a businessamlive reporter and Head of Financial desk.
Ikeja Hotels commits to repositioning as tourism, hospitality industry leader
As trading resumes on the erstwhile suspended shares of Ikeja Hotels Plc, the new Board of Directors has given their assurance to investors and stakeholders on implementing strategic planning to yield great returns.
Led by Anthony Idigbe, Chairman, Ikeja Hotels Plc to the Nigerian Stock Exchange (NSE) on Friday to a presentation of facts behind the restructuring, the company noted that its immediate plans include the completion of a forensic audit on the company and its investee companies, Capital Hotels Plc and Tourist Company of Nigeria.
Anthony stated that the company was equally committed to implementing the decision and recommendations of the forensic auditors, working with the financial advisers to unlock inherent value and ensure adherence to best standards of regulatory compliance and Corporate Governance.
These, the chairman said is in a bid to restore investor confidence in the company and return the company to its position as the leader in the tourism and hospitality industry in Nigeria.
The company presented its financials from 2013 which showed a steady growth in the company’s balance sheet. The company has also grown revenue from N11.2 billion in 2013 to settle at N12.1 billion as at the 2017 year end. Commenting on the 206-2017 FY results, Anthony said the 12 percent growth in revenue was due to the completion of the 5th and 6th floors of the hotel which impacted an increase in Gross Profit. He said re-organization led to a 9 percent decrease in operating expense, while significant foreign exchange gain of N1.2billion which impacted the operating profit in 2016 was not repeated in 2017.
The company’s first quarter results for the period ended March 31, 2018, show revenue increased from N2.7 billion in 2017 to N3.1 billion in 2018. Profit before tax increased from N180 million in 2017 to N328 million in 2018
The Securities and Exchange Commission (SEC) had on the 4th May 2017, taken a regulatory action to dissolve the former Board of Directors and appoint an interim board led by Anthony Idigbe
The objective of the action was to protect the investors of the company, to protect the integrity of the capital market and to restore the lost fortunes of the company in the shortest time possible. The new interim board were thus mandated to oversee the conduct of a forensic investigation into the affairs of the company considering the allegations of unauthorized sale of shares and diversion of proceeds from the sale of shares amongst others.
The intervention yielded results among which are, the conclusion of the audit of financial statements for the years ended 2012, 2013, 2014, 2015 and 2016, a successfully held 40th Annual General Meeting of the company on the 25th of October 2017, reorganisation of the staff with resultant return to vibrancy and company efficiency, a reduction in operating expenses, a review of existing/drafting of new corporate governance policies and a commencement of active engagement with the regulators in a bid to resolve all regulatory sanctions levied against the company
The company also engaged with the operators, key shareholders and staff in a bid to restore business confidence, and appointed Meristem Capital as financial advisers to propel the ongoing restructuring activities.
These led to trading suspension lift as disclosed by the news agency of Nigeria, who quoted Tinuade Awe, NSE Executive Director Regulation, to have said the new board had complied with the necessary regulatory requirements and had restored the company to the path of recovery.
With 663 rooms, 8 outlets, 14 meeting rooms and 2 conference halls, and one of the top choice hotel for 7 international airline crews, Ikeja Hotel’s principal business is the provision of hospitality services.
It has a controlling interest in Capital Hotels Plc, the owners of Sheraton Abuja Hotel, has significant influence in the Tourist Company of Nigeria, owners of Federal Palace Hotel & Casino by virtue of its shareholding, and has a long-standing operating agreement with global hospitality brand, Marriott International.