Hotel operator Serena TPS cuts loss to 633 million shillings

Companies

Hotel operator Serena TPS cuts loss to 633 million shillings


Guests enjoy a serene environment at the Serena Beach Hotel in Mombasa. FILE PHOTO | NMG

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Summary

  • The company received waivers from its lenders, a move that helped ease pressure on its financial situation.
  • TPS long-term borrowings increased from 4.9 billion shillings to 5.5 billion shillings, partly due to deferred interest charges.
  • The company had previously said it was in talks to extend or restructure credit facilities from Absa Bank Kenya and Proparco in addition to receiving financial support from its majority shareholder Aga Khan Fund for Economic Development, SA.

Operator of hotel brand Serena TPS Eastern Africa #ticker:TPSE nearly halved its net loss to 632.9 million shillings in the financial year ended December as sales increased as the Covid-19 pandemic.

The Nairobi Stock Exchange-listed company #ticker:NSE had posted a net loss of 1.2 billion shillings a year earlier, as the hospitality industry suffered the most from cancellations of reservations and travel restrictions as respiratory disease was developing.

The company’s sales increased by 61.6% from 2 billion shillings to 3.2 billion shillings.

“Due to the global distribution of vaccines, travel restrictions and curfews have eased from the third quarter of 2021, as Covid-19 related deaths have decreased significantly,” the company said in a statement.

“So, as the world headed for an uneven recovery, the group needed to be nimble in response to rapidly changing circumstances on various fronts of the business.”

TPS’ cash position improved to 93.2 million shillings from a negative 133.5 million shillings. The company received waivers from its lenders, a move that helped ease pressure on its financial situation.

“With vital support from our senior lenders, the group has successfully deferred debt repayments to support operations in exceptionally difficult circumstances,” the company said.

The French development fund Proparco is one of the institutions that financed the hotel operator. TPS long-term borrowings increased from 4.9 billion shillings to 5.5 billion shillings, partly due to deferred interest charges.

The company previously said it was in talks to extend or restructure credit facilities from Absa Bank Kenya #ticker: ABSA and Proparco in addition to receiving financial support from its majority shareholder Aga Khan Fund for Economic Development, SA.

TPS says it will implement essential property maintenance across the Serena portfolio. He added that he will be ready to resume his expansion this year by actively seeking management contracts in strategic locations.

The company said the business environment remains fluid on the negative effects of the Russian-Ukrainian conflict.

“Energy and commodity prices surged, adding to inflationary pressures from supply chain disruptions caused by the Covid-19 pandemic,” TPS said.

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