TOURIST OF NIGERIA : TCN 2021 - SUSTAINABILITY REPORT

The Tourist Company of Nigeria PLC (RC3781)

2021 ENVIRONMENTAL, SOCIAL &

GOVERNANCE REPORT

	ENVIRONMENTAL	SOCIAL		PROTECTING			ETHICS		TRUST AND
	RESPONSIBILITY	UPLIFTMENT		OUR PEOPLE					PASSION

2021 THE TOURIST COMPANY OF NIGERIA PLC Environmental, social and governance report	1

The Tourist Company of Nigeria PLC (RC3781)

STRATEGIC LEADERSHIP

At The Tourist Company of Nigeria Plc (TCN) we are committed to a business strategy that incorporates economic, environmental, and social factors as incorporated into our organization's policies, practices, and processes to enable the shared value addition with long-term benefits for the respective external and internal stakeholders while being mindful of conserving and protecting resources as is demonstrated by our environmental, social and governance (ESG) activities.

In 2021, our sustainability journey evolved in the face of numerous challenges owing to the onset of COVID-19. We assessed and adjusted our business model continuously to expand on the cost saving initiatives necessitated by the challenges borne out of the pandemic and to ensure a continued sustainable business strategy.

This included a holistic ESG focus, allowing us to measure, monitor and evaluate our efforts towards minimising our impact on the natural and social environments we operate in while ensuring sustainable value creation for all our stakeholders.

Our strategy included: improving our existing operations and our guest experience; protecting our existing assets; growing our revenue streams, governance and sustainability and our people. In 2021, our strategic objectives were refreshed to align with our current operating environment and strategic outlook.

FORWARD-LOOKING STATEMENTS

This report may contain certain forward-looking statements other than the statements of historical fact, which cannot be construed as reported financial results. Investors are cautioned not to place undue reliance on any forward-looking statements contained herein, as they have not been reviewed or reported on by the company's external auditors. Such statements may include predictions of or indicate future earnings, objectives, savings, events, trends or plans based on current expectations, forecasts and assumptions. As with any forward-looking statement, prediction or forecast, there are inherently unexpected events which could cause uncertainty and unexpected change which have not, and could not, be accounted for. Whereas the company has made every effort to accurately and

reasonably ensure the accuracy and completeness of the information contained within this report, any forward-looking statements speak only as of the date that they are made. The actual results may vary materially from those expressed or implied and the company undertakes no obligation to publicly update or alter these or to release revisions after the date of publication of this report.

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The Tourist Company of Nigeria PLC (RC3781)

CUSTOMER

CENTRICITY

PEOPLE AND	OPERATIONAL
EXCELLENCE AND
CULTURE
EFFICIENCIES

ENVIRONMENTAL,	MAXIMISE
SOCIAL AND	SHAREHOLDER
GOVERNANCE (ESG)	VALUE

These strategic objectives are:

While ESG is a standalone objective, these ESG elements are encompassed within all our other strategic objectives.

We are continually seeking strategies to help us lead sustainable environmental management in the hospitality sector. This includes concerns like a sustainable energy supply and rising energy costs, water quality and availability, and increasing concerns around the shortage of certified waste contractors and the amount of waste going to landfills.

Our people are the heart of our business and continue to go above and beyond the call of duty during the challenging Covid-19 period, and as we emerge from it.

They are the primary interface with our guests and customers and are the custodians of memorable guest experiences.

The health, safety and wellbeing of our employees and guests continue to be a key focus area for TCN and encouragingly there were no fatalities for the year under review. We continued to mitigate the impact of the Covid- 19 pandemic through industry-leading interventions aligned with global best practices and local legislation.

The board remains committed to promoting an ethical culture from the top as well as to actively engaging stakeholders. We embrace the governance pillars of integrity, responsibility, fairness, transparency, honesty and accountability for all stakeholders, which assist in preserving our long-term sustainability and maximising stakeholder value.

We are proud of how TCN has made it through the last two years. Our focus is now on the future and the prospects of renewed growth. We thank our people for their role in overcoming the immense challenges we faced and look forward to their continued contribution in helping us regain our momentum.

Chief (Dr) Anthony Idigbe, SAN	Mr David Kliegl
Chairman	Executive Director
30 September 2022	30 September 2022

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The Tourist Company of Nigeria PLC (RC3781)

SUSTAINABLE VALUE CREATION

Our ESG dimensions rest on the ethical principles of avoiding and or minimizing harm and optimizing benefits to all respective stakeholders within our operating environment. TCN's continuous efforts assist in minimizing the environmental impact on our society and community and avoiding waste in all its forms wherever possible. Our successful sustainable value creation is aided by a layer of checks and balances within the organization covering the Company's Board, Management and Investors, to enhance operations and deliver optimal value creation and leave a positive environmental and social footprint.

OPERATING ENVIRONMENT

Our macro-operating environment continues to be influenced by external and internal factors that are not always under our control. These factors include economic, regulatory and industry trends in Nigeria as well as the Covid-19 global pandemic that continues to impact our entire operating environment. This operating environment constantly informs and shapes our strategy as we adapt to these trends and navigate our way forward.

Economy

Covid-19

global

Gaming &

HospitalityRegulation

industry

COVID-19 GLOBAL PANDEMIC

IMPACT IN 2021

The effect of the COVID-19 pandemic and its various variants continues to negatively affect the business of the Tourist Company of Nigeria Plc (TCN), as seen in the 2021 financial year, and the world at large, as it adapts to the pandemic's effects.

COMPANY INTERVENTIONS:

Cost optimisation

OUTLOOK:

The Covid-19 pandemic, coupled with the ongoing restrictions imposed on business activities, will continue to have an impact on the company's trading results and will take time to recover. We must continue to adhere to COVID-19 protocols and health advisories to keep safe. Encouragingly, the Federal Government rollout of the vaccination programme and a reduction in infection rates over time will result in a more stable operating environment, positive sentiment and improved trading conditions.

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The Tourist Company of Nigeria PLC (RC3781)

ECONOMY

IMPACT IN 2021:

The National Bureau of Statistics (NBS) estimates that Nigeria's economy grew by 3.4% in 2021, from the 1.92 % contraction recorded in 2020. Accordingly, in its National Gross Domestic Product report for Q4 2021, Nigeria's Gross Domestic Product (GDP) grew by 3.9% (year-on-year) in real terms in Q4 2021, showing a sustained positive growth for the Q4 since the recession and inflation witnessed in 2020 when output contracted by -6.10% and -3.62% in Q2 and Q3 of 2020 under the Covid pandemic.

The Q4 2021 growth indicates a steady recovery accounting for annual growth of 3.40% in 2021. As a result, the Q4 2021 growth rate was higher than the 0.11% growth rate recorded in Q4 2020 by 3.87% points and lower than 4.03% recorded in Q3 2021 by 0.05% points. Nevertheless, quarter on quarter, real GDP grew at 9.63% in Q4 2021 compared to Q3 2021, reflecting a higher economic activity than the preceding quarter. As a result, the nominal GDP growth rate in Q4 2021 was higher relative to the 10.07% growth recorded in Q4 2020 but lower than the 15.41% growth recorded in the preceding quarter. Consequently, 2021 annual nominal growth stood at 13.92%.

Global growth projections are more positive at 4.4% (2020: -3.5%) as economies rebound from the Covid-19 pandemic impact. The International Monetary Fund (IMF) is forecasting a GDP growth of 2.5% in 2022 for Nigeria. Personal disposable income remains under severe pressure, resulting in less disposable income allocated to leisure and entertainment spending.

COMPANY INTERVENTIONS:	OUTLOOK:
Ongoing cost efficiencies and optimization.	We are committed to ensuring the Company's profitability and
	applying solid strategies to compete on the price and quality of the
	hospitality services rendered to customers and maintain its
	property to the highest standard.

GAMING & HOSPITALITY INDUSTRY

IMPACT IN 2021:

Nigeria had a slow start to the year with the Covid-19 second wave peaking in January 2021. Occupancies began to recover, however, various local and international restrictions remained throughout 2021.

With the new variant (Omicron) identified, Nigeria was included on international countries' red lists, which severely impacted the influx of international travellers. With the relaxation of certain restrictions, we are hopeful that there will be an uptick in local and international tourism during 2022.

The hospitality industry continues to be significantly impacted by travel disruptions due to Covid-19. Consumers' disposable income was also constrained due to financial uncertainty, fear of unemployment and other socio-economic factors.

COMPANY INTERVENTIONS:

• Implemented a new website booking engine
• Joined the Global Hotels Alliance - world's largest alliance of independent hotel brands network
• Focus on local leisure in the absence of international travellers
• Continued to focus on cost optimization

OUTLOOK:

While lockdown and economic challenges are likely to remain into the foreseeable future, as the harsh travel bans imposed on Nigeria over December 2021 were lifted, our hotel remains well placed to host all guests (local and international) and ensure safe and memorable experiences.

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