Dissecting the Financial Results of Companies in Nigeria's Hospitality Sector - CAPHOTEL

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Friday, April 30, 2021   /05:50 AM  / By Proshare Research / Header Image Credit: EcoGraphics


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Capital Hotels Plc

 

Revenue

Capital Hotel Plc's revenue fell in 2020 by -62.36%. This was largely attributed to the lockdown imposed by the government which affected its customer base. Its revenue declined from N5.18bn in 2019 to N1.95bn in 2020 (see Chart 16).


Chart 16: Capital Hotel Plc Revenue (N'bn)

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Source: Capital Hotel Plc Financial Statement, Proshare Research

 

The highest contributor to Capital Hotel Plc's revenue was its rooms 47.79%, food & beverage 34.84%, and other services 17.37%. As expected, there was a decline in all the revenue components of the business in 2020, rooms fell by -64.5%, foods and beverage dipped by -66.76%, and other services tumbled by -34.79% (see Table 8).

 

Table 8: Breakdown of Capital Hotels Plc (N'bn)

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PAT

In 2020, Capital Hotels Plc recorded its first loss in over six years. It recorded a loss of N241.86m in 2020 from a profit of N401.78m in 2019. The decline in its profit could be attributed to the decline in its revenue by -62.36% caused by the coronavirus pandemic (see Chart 17).


Chart 17: Capital Hotels Plc Profit (N'bn)

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Source: Capital Hotel Plc Financial Statement, Proshare Research

 

Administrative Expenses

Capital Hotels Plc recorded a decline in its administrative expenses by -20.49% to N558.54bn in 2020 from N702.47bn in 2019. It recorded a decline in AGM expenses, bank charges, communication cost, depreciation & amortization, directors' expenses, legal & professional expenses, employee's costs, medical expenses, transport & travels, and other expense (see Chart 18).

 

Chart 18: Capital Hotels Plc Administrative Expenses (N'bn)

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Source: Capital Hotel Plc Financial Statement, Proshare Research

 

Total Assets

Capital Hotels Plc recorded an increase in its total assets by +82.93% to N18.11bn in 2020 from N9.9bn in 2019. The rise in total assets was attributed to the large rise in property, plant & equipment by +155.26% to N15.52bn in 2020 from N6.08bn in 2019 (see Chart 19).

 

Chart 19: Capital Hotel Plc Total Assets (N'bn)

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Source: Capital Hotel Plc Financial Statement, Proshare Research 

 

Current Ratio

The hotel group's current ratio slid from 1.51 in 2019 to 1.18 in 2020. This meant that Capital Hotel had liquid assets of N1.18 for every N1.00 in short-dated liabilities. The decline in the current ratio was ascribed to a dip in its current assets which skidded lower than the decline in current liabilities. Its current assets fell by -31.42% while its current liabilities slipped by -12.35% (see Chart 20).

 

Chart 20: Capital Hotel Plc Current Ratio

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Source: Capital Hotel Plc Financial Statement, Proshare Research

 

Acid-test Ratio

Capital Hotels Plc acid-test ratio declined to 1.18 in 2020 from 1.49 in 2019. This suggests that for every N1 of current liabilities, Capital Hotel had N1.18 of very liquid assets to cover its immediate obligations (see Chart 21).

 

Chart 21: Capital Hotels Acid-test Ratio

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Source: Capital Hotel Plc Financial Statement, Proshare Research

 

Equity

Capital Hotels Plc recorded its highest equity in seven years. Its equity grew by +128.85% to N14.58bn in 2020 from N6.74bn in 2019 (see Chart 22).

 

Chart 22: Capital Hotel Plc Equity (N'bn)

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Source: Capital Hotel Plc Financial Statement, Proshare Research 


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Downloadable Version of Proshare Confidential: Hospitality Post-COVID-19: Making the Future Count

1.      Full Report: Hospitality Post-COVID-19: Making the Future Count - Apr 23, 2021

2. Executive Summary: Hospitality Post-COVID-19: Making the Future Count - Apr 23, 2021


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Related Links

  1. Hotels - A Peep into Performance
  2. Hospitality: COVID-19 Related Policy Shifts
  3. Hospitality Before and After - The Unmaking of Hotels
  4. Hospitality: A Post-COVID-19 Reality
  5. Hospitality Post-COVID-19: Making the Future Count

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