Ikeja Hotel Plc has announced its unaudited financial results for the second quarter ended June 30, 2025, posting a Profit Before Tax (PBT) of N2.18 billion, representing a 57% year-on-year (YoY) growth.

This strong Q2 performance pushed half-year PBT to N4.67 billion, marking a 127% YoY increase compared to the N2.06 billion reported in H1 2024.

The strong bottom-line performance was underpinned by robust revenue growth, driven largely by room sales, which contributed over 71% of total revenue.

Revenue rose by 36.6% YoY, outpacing the growth in cost of sales, to reach N6.021 billion in Q2 2025, bringing total H1 2025 revenue to N12.13 billion. Notably, the company generated over N8.5 billion from room sales alone in the first half of the year.

The Board of Directors has declared an interim dividend of N0.03 per 50 kobo ordinary share. The dividend is subject to withholding tax and will be paid to shareholders whose names appear on the Register of Members as of August 15, 2025.

A cursory review of the financial reports shows strong topline growth, driven primarily by revenue from room sales, supported by a notably high revenue-to-cost ratio.

In Q2 2025, Ikeja Hotel generated N4.3 billion from room sales, with a direct cost of just N468 million, translating to a revenue-to-cost ratio of 9.19x. In essence, the hotel earned N9.19 for every N1 spent on direct room-related costs.

This delivered a room gross profit of N3.83 billion and an exceptional room gross margin of 89.1%. This high margin from core room operations contributed significantly to the overall increase in gross profit, lifting the company’s gross margin to 47.5% in Q2.

Such high margins are typical in the hospitality industry, where heavy upfront investments in property, plants, and equipment (PPE) help keep variable costs low during operations.

Additionally, the narrow gap between the gross profit margin (47%) and the operating profit margin (35%) reflects moderated overheads. This ensures a sizable portion of revenue flows through to operating profit, reinforcing the hotel’s ability to remain profitable in a capital-intensive business.

As of June 30, 2025, Ikeja Hotel’s total assets stood at N88.34 billion, reflecting a modest 6% decline from N93.67 billion recorded at the end of December 2024.

Shareholders’ equity rose by 9.96% in six months to N33.60 billion, supported by retained earnings growth.

Other key highlights: (Q2 2025 vs. Q2 2024)

As of the close of trading on Monday, July 28, 2025, Ikeja Hotel’s share price stood at N23.10, reflecting a 105% year-to-date (YtD) gain.