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Aviation: Nigerian ground handling firms count revenue losses due to pandemic-induced plunge

The effects of COVID-19 induced lockdowns and travel restrictions have forced ground handling firms to consider job cuts, and cost reduction measures in a bid to survive.



Major ground handling companies in Nigeria are facing a revenue crisis following published results in the first nine months of 2020. Reports from two of the major listed ground handling companies listed on the Nigerian Stock Exchange, reveals a revenue decline of over 20%, due to a fall out of the COVID-19 induced lockdowns and travel restrictions.

The state of their financials led some of them to consider job cuts, and cost reduction measures in a bid to survive even after the lockdown was eased.

READ: LivingTrust Mortgage Bank posts N192 million in Q3 2020

Since the breakout of COVID-19 in March 2020; the FG approved lockdown in Abuja and Lagos State, both international airport hubs, forcing most airlines to shut down operations. This further affected the operations of the ground handling firm, as the government sought to contain the spread of the virus.

Aside from the COVID-19 pandemic dilemma, the sector was also affected by the activities of #EndSARS protesters that blocked the entrances of the Lagos airport to express their grievances against police brutality and extortion in the country.

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The companies are Skyway Aviation Handling Company Plc (SAHCO) and the Nigerian Aviation Handling Company Plc (NAHCO). Their combined revenue for the nine-month period ended September 30 dipped by N2.7billion to N10.1bllion from N12.8billion in the same period of 2019.

According to their financials, the drop represents a 21% reduction in revenue in the period under review.

READ: Nigerian hotels count revenue losses due to pandemic-induced plunge

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  • Revenue for the first nine months of the year dipped by 29.8% from N7.4 billion to N5.2billion.
  • A loss before tax of N76.1 million for the nine months of 2020, as against a profit before tax of N973.1million in the corresponding period of 2019.
  • A loss after tax of N65.9million for the nine months of 2020, as against a profit after tax of N782million in the corresponding period of 2019.
  • Less income for passenger/aircraft handling for the first nine months of 2020 compared to the same period in 2019.
  • Passenger/aircraft handling for the nine months of 2020 was N1.7billion compared to the N4.1billion recorded for the same period of 2019, representing a revenue reduction of 56%.

READ: Nigeria’s inflation rate jumps to 14.23% in October 2020


  • It recorded a revenue decline of N4.9billion for the first nine months of 2020, as against N5.4billion recorded within the same period in 2019 – a drop of 9%.
  • Profit before tax stood at N549million, compared to the N599million recorded in 2019.
  • It recorded N318.8million profit after tax for the first nine months of 2020, compared to N341.8million in the corresponding period of 2019. This represents a decline of 6.7%.
  • Revenue from foreign handling dropped to N605.6million from N950.4million.
  • Revenue from domestic handling was down N278.9million compared to the N447.7million recorded for the same period of 2019.

READ: NAHCO reacts to $8.06 million intercepted by Customs at Lagos Airport 

What they are saying

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Country Manager, Nigeria & West Africa, Qatar Airways, Kennedy Chirchir, explained that the state of the sector is the result of the new normal of the industry, which means a total paradigm shift.

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He said, “We are moving to the digital space where physical interaction would be reduced drastically. Most of the operations will be on a digital platform. There will be more requirements in terms of the turnaround of aircraft. Before now, it takes about 1 hour for aircraft to turnaround, but now it may take as long as 2 or 3 hours because there would be stricter checks. These will happen but will not stop people from travelling and that means the future is bright for the sector.”

READ: AMAC raises alarm over proliferation of fake revenue officers

On the part of travel agencies, Managing Director, BTM Travels Limited, Lola Adefope, explained that the adoption of technology would be emphasized. Before this, she insisted that it was important for operators and regulatory authorities to ensure that right policies and processes were in place to drive the technology, else the nation would be placing the cart before the horse.

“What we need to do is to implement a proper education process and platform. That is to ensure people understand the risk of travel and the safety measures in place with the technology to support the process. The technology will push notifications to people directly.

“We are going to see a move to much smaller groups when it comes to actual leisure travel. Leisure travel won’t develop at the international scene immediately, but we have to develop domestic tourism. We must put in place policies and processes before we open our borders for intercontinental or international tourism,” she said.

Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper. The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference. The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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6 managers, 5 name changes, the journey from Econet to Airtel

We explore the two-decade transition of pioneer telecoms company, tracing the journey from Econet to Airtel.



Airtel, econet, celtel

The telecommunication industry in Nigeria does not have a lot of players, but of the few in existence, Airtel Nigeria is one of peculiar interest to Nigerian subscribers.

Having seen the telco change its management six times and brand name five times, with each lasting about three years or less, a lot of users agree that they would not be surprised to see another change.

However, the company appears to have stabilised under its current management – Bharti Airtel and retained the name longer than every other one before it.

So, let’s look at the story behind the company that is now the second most popular telco in Nigeria.

READ: Airtel Africa set to expand its Nigeria and other Africa operations with $1.25 billion

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The days of Econet

In 2001, Strive Masiyiwa assembled a consortium of 22 investors in order to raise money to bid for the $285 million GSM license, which he described at the time as “the most expensive license ever issued in Africa.”

Alongside MTN Nigeria and MTEL, Econet won the bid and was granted a Digital Mobile License (DML). Econet Wireless Nigeria immediately set up shop and started operations, gaining an estimated 57% market share in a short period, despite the existence of competition.

All seemed to be running smoothly until Masiyiwa was asked to pay about $9m in ‘bribes’ to senior politicians in different state governments, who had facilitated the fundraising to pay for the license.

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READ: Airtel Africa to sell its 4,500 tower assets to cut down $3.5 billion debts

According to Masiyiwa’s social media post years later, he did not authorize the payments and thus invoked the wrath of a Governor in the South-south region at the time, who was one of the most powerful politicians in the country and had a reputation for getting what he wanted at any cost.

The Governor made good on his threat and without justification, the shareholders met and voted Econet Wireless Nigeria out of management, effectively cancelling their contract.

Masiyiwa recalled that at the meeting, one of the politicians who also happened to be a businessman told him, “Unfortunately for you, God does not have a vote.”

READ: Recession: Cost of governance in Nigeria unacceptable anywhere in the world – Peter Obi

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This move nearly drove Econet into bankruptcy and led them to withdraw about 200 foreign staff and left Nigeria. It also marked the beginning of Vodacom, the name adopted by the big international operator which was invited to take over as technical partner and operator.

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Although there is no evidence to conclude that the new operators paid the ‘bribes’, Masiyiwa insists in his blog that he has access to documentation showing that they paid the money. It was on this basis that he would later write a letter to the United States Department of Justice.

READ: NSE explains why Airtel Africa is going ahead with IPO despite failing listing requirement

Vodacom to the rescue

With the change of management, Vodacom came into the picture in 2004 but its contract was over before it even started.

Not much information is publicly available about the events that led to the exit of Vodacom in such a short while, without even having the opportunity to change the brand name.

Within a couple of months, Vodacom left the wheels and management changed hands again – this time to Vee Networks. At this time, the company had close to a million subscribers.

READ: Devaluation hurts Airtel Nigeria’s revenue as data revenues grow by 40%

Now V-mobile and it’s all about you

With Vee Networks as the new manager, the company’s name was changed to V-mobile and it launched a rebranding campaign in 2004.

Perhaps, the name change was to send a signal that a new company is in charge or to assure customers that the change of management could only be in their interest. The campaign branded the telco as the network for the Nigerian people, with the catchphrase being “It’s all about you”.

According to the company, all of its investors were Nigerian-based, including three state governments – Lagos, Delta, and Akwa Ibom.


READ: Airtel loses over 100,000 subscribers in one month, as Glo chases MTN’s market share

The name V-mobile is believed to have been adopted from the Vee in Vodacom, and the new managers also retained quite a number of Vodacom’s South African staff, with some of Econet staff as board directors.

In this way, V-mobile retained a little of the character of its past owners.

Then came Celtel

In May 2006, exactly two years after Vee Networks took over the reins with all its corresponding campaigns, Celtel communications acquired V-mobile for $1.005 billion and gained a controlling share of 65 percent ownership.

The transaction covered the purchase of existing shares and a substantial equity injection expected to boost Vmobile’s financial ability to realize its growth potential.

READ: Pay TV operator, Kwese takes a major stake in Iflix Africa

Celtel International, a subsidiary of MTC Group and a leading mobile operator in Africa was thus going to expand its presence to Nigeria, making a total of 15 countries.

Before this acquisition, V-Mobile had already grown the subscriber base from less than 1 million to over 5 million subscribers in two years – the most significant growth the company had witnessed under a single management at the time.

READ: Econet wants to bring hybrid power solution to Nigeria

History strikes again

There was yet again another change in management. In 2008, another telecommunications company, Zain Group, completed its acquisition of all Celtel International’s shares of over $3 billion.

The Zain Group had earlier acquired 85% stakes in Celtel International and its 14 African subsidiaries in May 2005 in a $2.84 billion deal and increased it to 100% two years later.

With the completion of this acquisition, all of Celtel’s operations in Africa had to be rebranded into Zain. So, it was not just the end of Celtel in Nigeria but also in Africa, as the new owners rebranded the entire African operations to Zain.

READ: Ahead of London IPO, Airtel names banks to supervise listing

“We believe the Zain brand provides an optimal platform upon which we can build a top 100 global brand with the ultimate goal of better serving our customers. It builds upon the success of our African operations and will propel the Zain Group towards becoming one of the top ten global mobile telecommunications companies by 2011,” Zain Group’s Chief Executive Officer, Dr. Saad Al Barrak said at a press conference.

But it only took two years before the management ran into a brick wall.

READ: Airtel is partnering Standard Chartered Bank as it expands its fintech business

Bharti Airtel arrives to save the day

In November 2010, another acquisition took place and Bharti Airtel paid a sum of $10.7 billion to become the new owner of the telco. Zain Nigeria became Airtel Nigeria.

It is now exactly a decade since this acquisition, and it seems like the company might be done with the days of management and brand changes.

The company seems to have now stabilised, and was even rated as the second largest in terms of subscriber base at the end of Q2, 2020. The financials have also remained in the black.

READ: Airtel is partnering Standard Chartered Bank as it expands its fintech business

Court disputes

In 2014, a decade after Econet lost its management contract, the Appeal Court sitting in Lagos ruled that Econet Wireless International remains a bonafide stakeholder in Airtel Nigeria.

This ruling frustrated the efforts of Bharti Airtel to prevent Econet Wireless International from reacquiring its stakes in the company.

The court also held that the earlier sale of 65 per cent of the telco to Zain of Kuwait was in violation of the pre-emptive rights of existing shareholder, Econet Wireless and null, since it did not follow proper procedures.

READ: Managing “emotional returns” in investments is key to staying on track

In a separate but similar ruling, the Federal Appeal Court in Kaduna had ruled that Econet Wireless was an existing minority shareholder in the company and urged Bharti Airtel to accept the reality.

Prior to this time, Bharti Airtel had continued to reject Econet Wireless as the holder of five per cent equity stake and tried to get Econet removed from the register of shareholders.

The dispute between Zain and Econet over the 2006 sale was already on and Bharti Airtel inherited the dispute. Econet was thus seeking equitable compensation for multiple breaches of the shareholders’ agreement.

Econet said in its submissions that its experts believed the quantum of the equitable compensation and damages amounted to more than $3 billion.

In December 2011, an international tribunal constituted under the auspices of the United Nations Commission for International Trade Law, UNCITRAL, ordered Celtel Nigeria to pay damages and equitable compensation to Econet Wireless for the violation of the company’s rights, which finally freed Bharti Airtel of any charges.

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Ratification, border opening and stakeholders’ views, as AfCFTA is set to commence January 2021

As the AfCFTA is expected to commence in January 2021, stakeholders discuss the ratification in view of Nigeria’s intended reopening of its land borders.



AfCFTA ratification

The African Continental Free Trade Area (AfCFTA) is expected to open up Nigerian businesses to a market of over 1.2 billion people and a GDP of $2.5trillion.

The Nigerian Government ratified the agreement on November 12, ahead of the December 5 deadline issued by the African Union to its 55 member states, as AfCFTA is expected to commence January 2021.

READ: AfCFTA: States should take advantage of continental free trade – FG

Despite this welcome development, some stakeholders are still concerned with the border closure policy of the Federal Government and dumping of substandard goods in the Nigerian market, with the recent disclosure by the FG that the borders will be reopened soon.

Key stakeholders spoke to Nairametrics on the significance of the ratification to Nigeria, the highly anticipated border opening, and the necessary steps that should be taken by the FG to fully maximize the trade agreement.

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READ: AfCFTA: Ratification demonstrates Nigeria’s economic leadership position in Africa – Trade Minister

Importance of the ratification

Mr. Muda Yusuf, the Director-General of Lagos Chamber of Commerce and Industry (LCCI), opined that the ratification has addressed the uncertainties within the Nigerian business circle concerning the FG’s stance on AfCFTA.

He said, “The ratification of the AfCFTA is good news. This decision has cleared the uncertainty and anxiety over Nigeria’s stance on the agreement. The truth is, we have seen a great deal of equivocation and prevarication over the agreement in the last two years.”

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READ: Finance Bill: No plans to increase tax — FG

Mr. Cheta Nwanze, Partner and Senior Analyst at SBM Intelligence, said the move is in Nigeria’s best interest since trade has historically been a pathway to prosperity.

He said, “Nigeria’s agreement to ratify is a good move, which is ultimately in the country’s best interest. Now, the country must position itself to make the best of it. Trade has historically been a pathway to prosperity, and this should be no different.”

READ: Airtel Africa posts an all-time high, investors gain N82 billion

After the ratification, what next?

Mr. Yusuf said, “The next step is to support the Nigerian private sector to take advantage of the 1.2billion market and $2.5trillion GDP, which offers tremendous opportunities. We need to strengthen the competitiveness of our domestic firms, especially those in the real sector.

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“We need to liberate them from the shackles of constraints putting pressure on their costs and inhibiting their competitiveness. The quality of our infrastructure needs to improve, our policies need to facilitate competitiveness, our regulations need to support business growth, and our institutions need to demonstrate a better appreciation of the value of investment and investors in the economy.”

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READ: Recession; proactive measures not cyclical factors can resuscitate economy

However, he emphasized that the competitive nature of the agreement would create ‘winners and losers’ and urged Nigerian businesses to review their business models.

“The AfCFTA will produce winners and losers across sectors. The vulnerability risks vary from sector to sector. Investments in the real sector are more vulnerable than those in the service sector. It calls for a review of the business models of many firms and industries in the light of new competitive forces that will emerge.

“The business landscape will change and many investment assumptions would have to be reviewed to ensure sustainability,” he added.

The anticipated border reopening

Mr. Nwanze believes the FG has taken the right step with the planned reopening of the border. But, believes that the borders will not be opened, with the perceived contradiction that exists amongst government agencies on the border closure issue.

Nwanze said, “The Finance Minister already said that the borders will be reopened. However, her disclosure, which is in the right direction, has been contradicted by the Agriculture Minister.

“Ideally, what should come next is for the government to put things in place for an export driven economy. That’s the way to take advantage of the AfCFTA. Unfortunately, the signal that we are seeing indicates major opposing views within the government.”

READ: Despite billions on agriculture, food inflation up by 108% since 2015

“If I were to bet on this, I’d say that the borders will remain shut beyond 1st of January, and this attitude to trade will continue as long as Customs remain under the current leadership.


“It is quite contradictory, especially as a Nigerian, Ngozi Okonjo-Iweala, is set to become WTO DG and as a result, one of the world’s leading advocate for trade. This represents a major irony,” he added.

Mr. Yusuf said, “The border closure is not consistent with the ratification of AfCFTA, which is why the FG has considered reopening the land borders ahead of its commencement in January 2021.”

The fear of dumping from neighboring countries

Mr. Nwanze said, “There are already a number of bodies who are tasked with ensuring that certain goods are of the required quality.

“Customs, the Standards Organization of Nigeria, NAFDAC, and others should do their jobs and stop harassing business people. The final arbiter of course is the consumer, who decides where and on what to spend his hard-earned money, rather than just settling for substandard goods.”

What you should know

  • Vice President Yemi Osinbajo disclosed in a conference with the Chartered Institiute of Personnel Management of Nigeria (CIPM) on Thursday, November 26 that quicker implementation of ratification protocols will ensure free movement of services, goods, and persons.
  • Yewande Sadiku, CEO of Nigerian Investment Promotion Council (NIPC), said in September that Nigeria is more ready for the African Continental Free Trade Area (AfCFTA), due to her domestic market manufacturing value addition capacity, which is 7 times the average of the top 20 economies in Africa and others.
  • The Nigerian trade office also disclosed that the Instrument of Ratification will be deposited with the AUC at Addis Ababa on Tuesday, December 1, 2020.

Bottom line

Nigeria has the potentials to benefit from the trade agreement in the areas of agriculture and service exports. However, Nigerian companies should be strategically prepared to compete with other African countries for the 1.2 billion market share.

Summarily, just like the EU and ASEAN trade bloc has produced some ‘winners’, the same is expected to happen when AfCFTA commences next year.

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Drive-ins, photo shoots, outdoor catering, hotels in Nigeria adopt new ways to survive

Hotels in Nigeria have adopted several creative measures to survive the negative impacts of the Covid-19 pandemic.



Transcorp Hotels Plc Retains Positive A- (NG) GCR Rating

Operators in the Nigerian hospitality industry have created opportunities for themselves amid the Covid-19 pandemic, in order to redefine value propositions and keep their heads above water.

To survive the negative impacts and ensure that they give their patrons reasons to continue patronizing their services, some of these hotels came up with initiatives like drive-in events, outdoor events, promotions, guest engagements, and group conference events, amongst others.

Transcorp Hotels

During its Q3 2020 Investors Call, the Managing Director of Transcorp Hotels, Dupe Olusola, told Nairametrics that though the revenue of the hotel, dropped by 54% year-on-year due to the lingering negative impact of Covid-19; Through the various initiatives implemented to reduce the impact of the pandemic, over 237% increase was recorded in Q3 revenue compared to that of Q2.

She said, “Drive-In Events product, launched in May, is for ‘top of mind’ awareness for the hotel amongst our targeted audience. It has also driven sales in the restaurant and other business areas within the hotel.

“Continuous promotion of our meetings, simplified product offerings like the Weekend Staycation, Work-From-Hotel package, amongst other initiatives, and have increased leisure business at the hotel.

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“With the launch of EventReady and the CleanStay program, we have seen an increase in meetings.”

She added that the hotel had witnessed improvement in room revenue, majorly driven by the transient and group segments, as well as its continuous marketing campaign of hotel offerings.

(READ MORE: As Hotels resume operations, how prepared are they?)

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She said, “Our Weekend Staycation is to attract both Abuja residents and potential guests from other states, in order to drive local and leisure demands.”

Ikeja Hotels Plc

Ikeja Hotels Plc also adopted some initiatives across its hotel chain to survive the pandemic. A staff of Sheraton Hotel Ikeja, who preferred anonymity, as she was not permitted to discuss on behalf of the hotel, told Nairametrics that the hotel had adopted some initiatives like outdoor events and promotions to attract more patrons.

She said, “As part of our strategy to improve operational efficiencies, we have put in place cost-cutting and recovery measures, including negotiating vendor contracts, energy conservation, and optimizing our workforce to the required manning at different occupancy levels.

“Our Food and beverage revenue has improved, driven mainly by the conference and event businesses. We recorded a week on week increase in the month of October.”

(READ MORE:COVID-19: partners others to provide self-isolation centres for Nigerians)

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L’eola Hotel

In the case of L’eola Hotel, formerly known as Protea Hotel, surviving the challenges created by the pandemic is key and this made the hotel to introduce some initiatives.

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In an interview with Nairametrics, its Deputy General Manager, Tunde Oduyoye, explained that the hotel had to invest more on social media tools to reach out to its clients and also to meet the needs of some patrons, who wanted to hold social gatherings despite the social distancing rule.

He said, “We just did a photoshoot, which we shared with our existing and potential clients via our social media tools, to remind our patrons that we are back and fully compliant with the Covid-19 protocols.

“We now host weddings and other occasions and Zoom to other guests that cannot attend physically due to social distancing rules. We also host occasions on our open field to guarantee the safety of our patrons.

“We deliver food to our clients and also engage Jumia for deliveries. The hotel has also started baking bread for lodging guests and others within and outside the community.”

(READ MORE:Experts wary of profit-taking, but remain bullish long term on Nigerian Stocks)

Radisson Blu Anchorage Hotel

Like other hotels earlier mentioned, Radisson Blu also adopted several measures to remain relevant to its patrons.

In an interview with Nairametrics, a source at the Hotel, who preferred anonymity, as he was not permitted to speak on behalf of the hotel, disclosed that it had adopted an outdoor catering service for both corporate clients and individuals.

He said, “Continuous promotion of our product offerings and other initiatives, has boosted patronage in our hotel. We now offer outdoor events and new discount rates for using our facilities. With this development, we have seen an increase in meetings at the hotel, compared with when the lockdown was eased few months back.”

What the future holds

Hotels in Kenya, Egypt, and South Africa rely on local tourism to drive occupancy rates. In contrast, locals in Nigeria prefer smaller mushroom hotels that are cheaper and often well-furnished to meet their needs, especially the short-stay apartments.


Hence, hotels in Nigeria rely on commercial room sales, driven by the influx of business and leisure travels into the country.

With several airlines yet to be fully operational due to reciprocal bans and lockdowns in some countries, it is highly unlikely that things will improve anytime soon.

(READ MORE: FG reopens the financial sector, hotels as bars and nightclubs remain closed)

What you should know

The lockdown effect on the revenue of these hotels is reflected in the 2020 Q2 results of the main listed hotels.

According to the data, Ikeja Hotels (Sheraton), Tourist Company of Nigeria (Federal Palace), Capital Hotels (Abuja Sheraton), and Transcorp Hilton Hotel Plc all lost 90% of their revenue in the three months preceding June 2020.

  • The hotels earned a combined revenue of N1 billion in the quarter, compared to N10.2 billion in the corresponding period of 2019.
  • They lost over N4.7 billion for the quarter alone.
  • Combined, they had about 3,502 employees as of 2019.

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