TPS Eastern Africa, the holding company for the Serena group of hotels and lodges, has issued a profit warning for its 2014 financial year. The group expects its profits to drop by more than 25 percent as a result of reduced tourist activity in the country. The group posted 973 million shillings in pretax profit in 2013. In a statement to the Nairobi securities exchange, TPS management says it faced serious business challenges in Kenya that had a ripple effect across its East Africa operations. TPS also cites the introduction of value added tax on tourism services and park fees as a deterrent to Kenya as a tourism destination.