Sheraton Lagos owner posts N5.31bn profit as borrowing costs hit zero

Ikeja Hotel Plc, owner of Sheraton Lagos Hotel, has reported a 14 per cent increase in nine-month net profit to N5.31 billion, buoyed by the elimination of borrowing costs despite rising operating expenses and modest revenue growth.

The hospitality company’s net profit rose from N4.66 billion recorded in the corresponding period of 2025, while finance costs fell to zero from N1.33 billion a year earlier, according to its financial results.

The development helped the company improve its bottom line even as operating profit declined amid rising costs.

Ikeja Hotel’s profit before tax increased by 15 per cent to N8.19 billion from N7.12 billion in the corresponding period of 2025.

However, revenue grew by 4.8 per cent to N19.41 billion from N18.52 billion, reflecting relatively modest growth in the company’s core hospitality business.

Operating profit fell to N6.22 billion from N6.90 billion, while cost of sales increased to N10.39 billion from N9.50 billion, highlighting the pressure of rising operating expenses on profitability.

Room rentals remained the company’s largest revenue source, generating N13.58 billion during the nine-month period, compared with N13.19 billion a year earlier.

Revenue from food and beverages also increased to N4.80 billion from N4.44 billion, reflecting improved earnings from catering and restaurant operations.

Other operating divisions contributed N96.64 million, up from N65.69 million, while miscellaneous income rose to N940.20 million.

Interest income from bank demand deposits increased by 27 per cent to N1.97 billion, providing an additional boost to the company’s earnings.

In July 2026, Ikeja Hotel acquired an additional 20 per cent stake in its subsidiary, Hans Gremlin Nigeria Limited, raising its ownership to 95 per cent.

The transaction strengthened the company’s control of the subsidiary as it continued to consolidate its interests in the hospitality and leisure sectors.

The company’s total assets rose to N80.96 billion from N77.44 billion at the end of December 2025.

Total equity also increased to N47.51 billion, supported by retained earnings of N31.12 billion.

The results indicate that the elimination of finance costs and higher interest income helped Ikeja Hotel improve its profitability, even as rising expenses weighed on operating performance and revenue growth remained modest.

(Shore Africa)