TPS Eastern Africa PLC, the company that operates Serena Hotels has issued a profit warning for the financial year ending December 31, 2025
In an announcement dated November 26, the Company said its Profit After Tax is projected to fall by more than 25 percent compared to 2024.
TPS Eastern Africa PLC attributed the anticipated decline to unrealized foreign exchange gains recognized in 2024 from the revaluation of foreign currency-denominated loans and lease liabilities, gains that are not expected to recur this year.
“The projected decline in Profit After Tax is primarily attributable to the significant unrealized foreign exchange gains recognized in 2024 on revaluation of foreign currency-denominated loans and lease liabilities, which is not expected to recur in the current year,” read part of the statement.
Serena Hotels Profit Set to Fall as Bookings Decline
The Company added that regional insecurity and subsequent travel advisories led to booking cancellations across its hospitality establishments, further weighing down performance.
The East African region remains volatile, with most countries confronting rising cases of violence. For instance, in 2024, Gen Z protests in Kenya caused an economic shutdown.
Consequently, the West issued advisories, asking citizens not to travel to Nairobi. Tanzania, Uganda, and the DR,C where TPS East Africa runs Serena Hotels, have also experienced unrest hitting the hospitality sector.
Increased provisions for outstanding receivables under International Financial Reporting Standard 9 (IFRS 9) also forced a downward revision of the Company’s business projections.
These combined factors are likely to contribute to the shortfall, the Company stated, noting that full financial details will be released with the audited results for 2025.
“These include the impact of the security situation in the region, coupled with travel advisories, which led to booking cancellations and increased provisions on outstanding receivables under IFRS 9, necessitating revision of business projections,” read part of the statement.
Also Read: Who Owns Serena Hotels, Safari Lodges & Resorts
Despite the shortfall, TPS said it is implementing measures to protect shareholder value, including strengthening its market position, upgrading products, enhancing guest experiences, and adopting new technologies.
The Board and Management maintained confidence in the Company’s long-term strategy and operational resilience.
“The Board and Management remain confident in the Company’s long-term strategy, financial stability and operational resilience,” ended the statement.
Also Read: American Hotel Giant to Open 3 Hotels in Kenya in Its Expansion to Africa
TPS Eastern Africa Reports Ksh16 Million Loss in H1 2025
TPS Eastern Africa Plc posted a Ksh16 million after-tax loss for the six months ended June 30, 2025, reversing a Ksh696 million profit reported over the same period last year.
The performance was weighed down by a 10.5 percent drop in revenue to Ksh4.055 billion and had the absence of the substantial foreign exchange gains recorded in 2024.
The company also reported a Ksh5.6 million share-of-loss from associates, compared to a Ksh29.5 million profit that was posted last year.
Total assets decreased 1.3% year-on-year to Ksh19.923 billion, while equity fell 1.9% to Ksh11.320 billion.
Despite the first-half challenges, TPS expressed optimism for a stronger second half, supported by the peak tourism season and improving market conditions.
On August 6, the company relaunched its Prestige Club loyalty programme and mobile app, introducing enhanced benefits for members across its properties.
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