TPS Eastern Africa, the hospitality group that operates Serena Hotels in Kenya and other East African markets, widened its net loss to Sh66.4 million in the first half of 2026 as revenue declined slightly amid challenges affecting regional and international travel.
The company reported a larger loss for the six months ended June 30, 2026, compared with the corresponding period last year, while revenue fell to Sh4 billion from Sh4.05 billion.
TPS Eastern Africa attributed the weaker performance largely to higher non-operating costs, including reduced finance income, increased depreciation, losses from associated companies and unrealised foreign exchange losses.
The company said finance income declined after it deployed part of its cash reserves, while depreciation increased following recent investments in its hotels and other properties.
The hospitality group said geopolitical developments during the period affected international travel and energy costs, creating additional pressure on the tourism sector.
TPS also reported that public health measures and travel advisories linked to the Ebola outbreak in parts of the region affected corporate and regional travel.
“Public health measures and travel advisories relating to the Ebola outbreak in parts of the region also affected corporate and regional travel segments. This resulted in a mixed business performance across the Group’s various source markets,” Company Secretary Dominic Ng’ang’a said on behalf of the board.
The developments resulted in varying performance across the group’s different markets and customer segments during the first half of the year.
TPS Eastern Africa expects its financial performance to improve during the second half of 2026 as recently completed refurbishment projects begin contributing more significantly to revenue.
The company has invested in upgrading several properties, including the Dar es Salaam Serena Hotel and the conference centre at Lake Manyara Serena Safari Lodge.
The improvements are expected to strengthen the group’s ability to attract both leisure and business travellers while supporting higher occupancy and revenue.
TPS also expects increased operational efficiency to improve its performance as the group continues to manage costs across its properties.
The group said its financial position is expected to benefit from reduced debt and lower financing costs.
TPS Eastern Africa has been implementing measures to reduce its debt burden, which it expects will translate into lower finance costs and improve profitability.
The company also plans to increase revenue generated through digital distribution channels as more customers use online platforms to make hotel bookings.
Growth in the Serena Prestige Club loyalty programme is another area expected to contribute to revenue as the group seeks to strengthen customer retention and encourage repeat bookings.
TPS Eastern Africa has assets valued at about Sh22 billion and shareholders’ equity of more than Sh13 billion, giving the group a strong financial base as it navigates short-term challenges in the hospitality industry.
The company said it remains optimistic about the long-term prospects of East Africa’s tourism sector despite uncertainty affecting international travel and operating costs.
“The Group remains confident in the long-term fundamentals of East African tourism and in Serena Hotels’ ability to manage near-term uncertainties while continuing to create sustainable long-term value,” TPS said.
The group operates Serena Hotels and lodges across several East African tourism destinations, serving both international and regional travellers.
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