Cresta fell into the red in 2025, reporting a P24.1 million loss after tax compared to a P2.4 million profit in the prior year, as weaker hotel demand and a significant asset impairment weighed on performance.
Revenue declined 5% to P365.2 million, reflecting lower occupancy rates and softer room pricing across the group’s business-focused hotels, which account for the bulk of its portfolio. The slowdown in the diamond sector and its spillover effects on corporate travel demand—particularly impacting operations in Jwaneng—further dampened performance.
Profitability was hit hardest by a P14.1 million impairment on Cresta Jwaneng, alongside additional impairments on non-financial assets, contributing to a collapse in operating profit from P31.2 million to near breakeven. Combined with finance costs of P28.9 million, this pushed the group to a pre-tax loss of P29.1 million.
Margins also came under pressure, with gross profit falling to P125.8 million and margin contracting to 34% from 38%, driven by lower revenue and higher depreciation linked to expanded room capacity. Administrative costs remained flat at around P101.7 million, reflecting tight cost control despite inflationary pressures.
The balance sheet weakened, with total assets declining to P525.8 million and equity falling 15% to P139.3 million due to accumulated losses and asset write-downs. However, debt levels reduced during the year, with borrowings falling as the group continued repayments.
Cash generation remained resilient, with net cash inflows of P0.2 million compared to an outflow in the prior year, supported by reduced debt servicing and tighter capital expenditure, which dropped to P14.6 million from P46.5 million.
Management said it will prioritise restoring profitability through cost discipline, stronger digital marketing and diversification into leisure and regional travel markets, while continuing to navigate a challenging macroeconomic environment.