(Financial Statements for the Year Ended 31st December 2024)
Key Financial Metrics
- Revenue: ₦5.55 billion (2024) vs. ₦4.39 billion (2023) → 26.5% growth
- Gross Profit: ₦1.46 billion (2024) vs. ₦1.37 billion (2023)
- Operating Loss: ₦(44.31) billion (2024) vs. ₦(33.68) billion (2023)
- Loss Before Tax (LBT): ₦(44.29) billion (2024) vs. ₦(33.67) billion (2023)
- Loss After Tax (LAT): ₦(44.31) billion (2024) vs. ₦(33.69) billion (2023)
- Basic Loss Per Share (LPS): (1.97) kobo (2024) vs. (1.50) kobo (2023)
Tourist Company of Nigeria Plc experienced moderate revenue growth in 2024, primarily fueled by higher room occupancy, increased food and beverage sales, and improved casino revenue. The hospitality segment benefited from enhanced marketing strategies, loyalty programs, and an increase in corporate events, driving higher occupancy rates. The food and beverage sector saw gains from menu optimization, targeted promotions, and improved customer experience, which contributed to better sales.
Casino operations also recorded growth, supported by expanded gaming options, special events, and increased patronage from both domestic and international visitors. However, despite these revenue improvements, persistent financial difficulties and mounting losses continue to hinder the company’s recovery, exacerbated by rising operational costs, foreign exchange losses, and high debt obligations. The company faces significant challenges in achieving sustainable profitability without major structural reforms and financial interventions.
Guidance
- Revenue increased by 26.5%, reflecting improved performance in hospitality and gaming operations.
- Despite revenue growth, losses worsened, with a 31.5% increase in operating losses.
- Accumulated losses reached ₦105.47 billion, signaling severe financial distress.
Operational Highlights & Cost Management
- Cost of Sales: ₦4.09 billion (2024) vs. ₦3.02 billion (2023)
- Administrative & General Expenses: ₦46.10 billion (2024) vs. ₦34.79 billion (2023)
- Sales & Distribution Expenses: ₦29.61 million (2024) vs. ₦308.13 million (2023)
- Foreign Exchange Loss: ₦43.09 billion (2024) vs. ₦30.28 billion (2023)
The company’s operating costs surged significantly, driven by foreign exchange volatility, high administrative expenses, and rising infrastructure costs. Persistent currency devaluation and import-dependent costs have severely impacted profitability, leading to a substantial rise in overall losses. The increase in administrative expenses stems from higher employee compensation, rising energy costs, and increased maintenance expenses as the company struggles to keep its facilities and services competitive.
Additionally, the continued depreciation of the naira against major foreign currencies has driven up the cost of imported goods, including food supplies, hotel amenities, and maintenance equipment, further pressuring margins. The company has also faced increased regulatory and compliance costs, as changes in government policies have imposed higher operational fees and levies on hospitality and entertainment businesses. Without decisive cost-control measures, these financial pressures will likely persist, exacerbating the company’s fragile financial position.
Revenue Breakdown
- Rooms: ₦2.10 billion (2024) vs. ₦1.57 billion (2023)
- Food & Beverage: ₦1.52 billion (2024) vs. ₦1.31 billion (2023)
- Casino Operations: ₦1.74 billion (2024) vs. ₦1.34 billion (2023)
Despite revenue improvements across all business segments, these gains were insufficient to offset rising operating costs and foreign exchange losses.
Capital Expenditures & Shareholder Equity
- Total Assets: ₦55.71 billion (2024) vs. ₦55.02 billion (2023)
- Total Liabilities: ₦109.78 billion (2024) vs. ₦64.81 billion (2023)
- Accumulated Losses: ₦(105.47) billion (2024) vs. ₦(61.18) billion (2023)
- Total Equity: ₦(54.07) billion (2024) vs. ₦(9.79) billion (2023) → Negative equity position
The company’s financial position deteriorated further, with liabilities far exceeding assets, resulting in a negative equity position. This signals urgent financial restructuring needs to ensure business continuity.
Management Commentary
Key Takeaways:
- Revenue growth was driven by improved hotel occupancy, food & beverage sales, and casino revenue.
- Foreign exchange losses and high administrative costs continue to impact profitability.
- Significant debt burden, with ₦104.27 billion in long-term shareholder loans.
- Operating costs remain high, limiting the company’s ability to achieve profitability.
Strategic Interventions Needed:
- Restructuring of existing debt obligations to improve liquidity and financial stability.
- Cost-cutting measures to reduce administrative expenses and operational inefficiencies.
- Potential recapitalization efforts to restore equity balance and strengthen financial resilience.
- Exploring new revenue opportunities through partnerships, service diversification, and digital transformation.
Outlook for 2025
Tourist Company of Nigeria Plc remains in a financially distressed position, with:
- Rising losses and negative equity, requiring urgent corrective actions.
- Foreign exchange volatility and high operating costs continuing to pose major risks.
- Potential revenue improvements from the expansion of hospitality and gaming operations.
To sustain future operations, the company must implement aggressive cost-cutting measures, restructure its balance sheet, and explore strategic partnerships for financial recovery.
Conclusion
Tourist Company of Nigeria Plc faces severe financial challenges, despite moderate revenue growth in 2024. The company’s high losses, negative equity, and significant debt burden pose serious concerns for its long-term sustainability. Persistent financial distress has led to deteriorating investor confidence and mounting pressure on operational efficiency.
Without immediate intervention, the company risks further financial instability, which could impact its ability to maintain business continuity. Urgent strategic interventions are needed, including debt restructuring, operational cost reduction, and revenue diversification efforts. Exploring strategic partnerships, capital injections, and aggressive market repositioning will be essential to stabilize the company and pave the way for long-term financial recovery.
