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Business News of Sunday, 1 August 2021

Source: punchng.com

Coronavirus: Aviation, hospitality industries worst-hit sectors - Ikeja Hotels

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The management of Ikeja Hotel Plc has given assurances to its shareholders that it would look carefully into their concerns, address the grey areas, and bring the company back to its pre-COVID-19 status as a one-stop hotel in the state.

The hotels’ Group Managing Director/Chief Executive Officer, Theophilus Netufo, gave the reassuring statement in his response to shareholders’ inquisitions at the 44th Annual General Meeting of the company in Ikeja, Lagos.

He said, “We are going to look into your comments; we will make adjustments where necessary and improve on our current position. On the issue of expenses, the board is making untiring efforts to make sure we put control measures in place to check our rising costs and to ensure that the company makes good returns in its activities.

“We are now collaborating with the operators; we are managing what they are doing. We have a kind of oversight function on what they do to ensure that they are operating within the acceptable cost measures as set up by the board. Hospitality and aviation industries are among worst-hit sectors.”

A shareholder, Adebayo Adeleke, identified with the company’s plight, noting that the aviation and hospitality industries were the worst hit sectors of the economy during the COVID-19 pandemic, but advised the management to step up its game amid stiff competition.

Other shareholders raised a number of concerns ranging from the company’s inability to declare a profit and charged the management to bring the company back to profitability by cutting costs.

In reaction, the GMD said, “On the issue of directors’ expenses, I want to say here that since the COVID-19 started, our directors have not been paid their allowances when due. Most of the meetings’ expenses are being accrued; they have not been paid at all.

“They have been so understanding and enduring the situation. They run most of the things they do on their own expenses. So I want to assure the shareholders that there is no cause for alarm at all.”

Responding to shareholders’ questions on government palliatives, Netufo said immediately the effect of the pandemic became so burdensome on the company, the company collaborated with the tourism group of the Lagos Chamber of Commerce and Industry and the Federation of Tourism Association of Nigeria.

“We made a representation to the Federal Government to seek palliatives for the hospitality industry as they did for the aviation industry. But when the government would reply, they only gave consideration to SMEs (Small and Medium Enterprises). Our own category of business was never considered by the government,” he said.

Earlier while reeling out his report on the company’s financials, the Chairman, Board of Directors, Chief Anthony Idigbe, informed the shareholders that the consolidated revenue decreased from N12.515bn in 2019 to N5.068bn in 2020.

He said, “The group recorded an operating loss of N6.5bn in 2020 from operating profit of N1.9bn in 2019 while profit-after-tax fell from N834m in 2019 to a loss of N6.7bn in 2020.

“Considering the impact of the pandemic on the company’s business and the slow recovery pace of the hospitality sector, the company made a loss and would not be declaring dividend for the 2020 financial year.”

“However, the management and board of the company will continue to work hard to ensure full recovery while bringing the company back to profitability,” Idigbe added.