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Companies
Foreign investments into Nigeria’s hotel sector crash by 98%
Data from the Central Bank of Nigeria suggest total capital importation into the hotel sector of Nigeria fell to a 5 year low of about $750,000 in 2016.
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The hotel industry in Nigeria is currently experiencing a supply glut as 3-4 star hotels dominate the skylines of major cities such as Lagos, Abuja and Porthacourt. A flurry of new hotels and recent developments have helped crash hotel room rates as well as drive down occupancy ratio of several of the hotels in Lagos.
Hotel occupancy room rates are said to have crashed below 40% in Lagos while, average room rates now stand at about $90 per night.
According to the data from the CBN, investments into the local hotel market has diminished from as high as $45 million in 2007 to about $750k (98%) in under 10 years. A combination of the 2014 Ebola breakout, threat of terrorism, the economic recession and crash in government expenditure has negatively impacted on the performance of hotels.
A weakened occupancy ratio and average room rate for an emerging economy like Nigeria is considered a huge disincentive for foreigners to invest in our hospitality sector. Issues around revenue sharing formula, management fees, development cost and project escalation due to over ambitious turnkey projects have also thought to have freaked foreign investors.
Currently, hotels in Lagos such as Federal Palace Hotel, Southern Sun, Eko Hotels, Intercontinental hotels are co-owned by foreign investors.
The Bureau of Statistics reported in its 2016 full year GDP report, that the accommodation and food services sector recorded a GDP negative growth rate of -5.3% compared to 2.3% and 18.3% in 2015 and 2014 respectively.
Companies
Neimeth Pharmaceuticals to raise N5 billion in additional equity
The Board of Neimeth is set to raise N5 billion additional equity upon the approval by shareholders of the company at the AGM.
Companies
Cutix Plc forecasts N148 million profit in Q4 2021
Cutix Plc has projected that its revenue will double and profit will increase by 9% to N148 million.
Cutix Plc has projected that in the fourth quarter of its financial year 2021, its revenue will double and profit will increase by 9% to N148 million.
These projections were made by the company in a recent earnings forecast issued by the Management, and signed by the Company’s CEO and CFO.
READ: Vitafoam shares gain 9.6%, as company reports N4.11 billion as profit in 2020
Key highlights of the earnings forecast for Q4 ended April 30, 2021
- Revenue to increase to N1.66billion, 100% Q-o-Q.
- Cost of Sales to increase to N1.16 billion, 70% Q-o-Q.
- Distribution, Admin & Other expenses to increase to N232.89 million, 14%% Q-o-Q.
- Other Income to remain unchanged at N2.50 million,
- Finance Charges to increase slightly to N47.38 million, 3% Q-o-Q.
- Operating income to increase to N227.83 million, 14% Q-o-Q.
- Taxation is projected at N79.74 million.
- While Profit attributable shareholders is projected at N148.10 million.
READ: Royal Exchange Plc forecasts N500.83 million PAT in Q1 2021
Bottom line
The earnings forecast was made on the ground that the Nigerian economy will continue improve, as the country recovers from the impact of COVID-19. In this regard, revenue in the fourth quarter of 2021 will be slightly higher than the revenue projected in the third quarter of 2021.
READ: Okomu Oil Plc records 27.01% decline in 2020 Q3 revenues
However, the increase in the cost of sales driven by the input cost will pressure profitability to the tune of N148.10 million, which is 9% higher than the profit after tax made in the corresponding quarter of 2020.
Companies
PZ Cussons proposes dividend payout of N397 million to the shareholders
The Board of Directors of PZ Cussons Nigeria Plc has proposed the payment of N397 million to the shareholders of the company.
