Ikeja Hotel Reports N5.29 Billion Profit in 2024, Revenue Jumps 69%

Editorial Team
3 Min Read
Anthony Idigbe

Ikeja Hotel Plc has recorded a profit before tax of N5.29 billion for the year ended December 31, 2024, marking a 39.46% increase from the previous year. The company also reported a strong revenue growth of 68.75%, reaching N18.75 billion, up from N11.11 billion in 2023.

This impressive performance was driven by higher room sales revenue, which contributed N12.83 billion (68.42% of total revenue), compared to N7.21 billion in 2023.

Key Financial Highlights (2024 vs 2023)

•Revenue: N18.75 billion (+68.75% YoY)

•Cost of Sales: N11.21 billion (+60.58% YoY)

•Gross Profit: N7.54 billion (+82.57% YoY)

•Operating Profit: N5.13 billion (+15.07% YoY)

•Finance Cost: N1.33 billion (+11.87% YoY)

•Profit After Tax: N3.45 billion (+66.53% YoY)

•Earnings Per Share (EPS): N1.60 (+66.67% YoY)

•Cash Reserves: N22.53 billion (+53.88% YoY)

•Total Assets: N69.51 billion (+16.31% YoY)

•Total Equity: N26.68 billion (+13.13% YoY)

•Retained Earnings: N10.40 billion (+41.21% YoY)

Profitability and Financial Strength

•Ikeja Hotel’s strong revenue growth helped boost gross profit by 82.57%, bringing the gross profit margin to 40.20%, up 8.19% from 2023.

•Despite the positive results, operating profit margin dropped from 40% to 27.37%, showing that rising costs are still a challenge.

•The company maintained a healthy financial position, with an interest coverage ratio of 3.86x, meaning its operating profits comfortably cover interest expenses.

Balance Sheet and Investor Confidence

•Total assets grew by 16.31% to N69.51 billion, backed by a cash reserve of N22.53 billion.

•Shareholders’ equity rose 13.13% to N26.68 billion, reflecting strong retained earnings and asset revaluations.

•The return on equity (ROE) was 12.94%, showing moderate but solid returns for shareholders.

Stock Market Performance & Dividends

•Ikeja Hotel’s share price has gained 8.44% so far in 2024, following a massive 471% return in 2023.

•The company maintained a dividend payout of 7.5 kobo per share over the last two years, but with higher earnings per share (N1.60) and strong retained earnings, investors expect higher dividends in the future.

Outlook: A Growing Hotel Business with Room for Improvement

Ikeja Hotel Plc has delivered impressive revenue and profit growth, strengthening its financial position and attracting investor confidence. However, rising operational costs and the need for better asset utilization remain challenges.

With continued strategic improvements, cost management, and higher dividend payouts, the company is well-positioned for sustained growth and enhanced shareholder value in the coming years.

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