Low Business Pushes TPS to Sh97 Million Loss

A slump in the tourism industry has driven hospitality group TPS Serena to a Sh97.3 million net loss during the first half of the year.

The company which operates the Serena chain of hotels made a profit of Sh41.5 million during the first half of last year.

The group which has several hotels in East Africa including at the Maasai Mara, Amboseli National Park, in Kampala, Mombasa and Kigali among others, has attributed the loss to sustained negative international publicity on the East African region as a tourist destination.

Tourism has been hit by insecurity, with terror threats causing lead source markets such as the UK to issue travel advisories over the period. The negative publicity also stemmed from the Ebola epidemic in West Africa and the poaching menace.

This, TPS said, reduced tourist bookings to Kenya and Tanzania, pushing it into losses.

The hotel’s unaudited half year results released yesterday shows its net interest cost dipped from Sh56.2 million recorded in 2014 to Sh108 million this year.

Sales also declined though by a marginal 1.48 per cent, to Sh2.67 billion this year from Sh2.71 billion in the period under review.

Exchange loss on foreign currency loans closed at 75.1 million from 14.5 million.

“The first half of year 2015 proved to be quite challenging for the company,” the hotel said.

The management however remains optimistic of recovering in the second half of the year, attributing the bullish outlook to recent lifting of the travel advisory to the Kenyan Coast by the UK.

“This will be key in turning around tourism in destination Kenya,” the management said.

Kenya’s tourism sector has been struggling with low numbers for the last two years due to insecurity.

Visitor arrivals dropped 18.9 per cent in the first half to 347,458 compared to 428,585 over the same period in 2014.