By Staff Reporter
HOSPITALITY group Africa Sun recorded a 30% increase in revenue for the first five months of 2018 against the prior period buoyed by increased foreign arrivals.
Giving a trading update at the annual general meeting managing director ED Shangwe said the impending election would drive business as foreign observers had begun arriving in the country.
He said the new dispensation had also changed the perception foreign travelers had on the destination evidenced by the growth in arrivals since the dramatic events of November.
“Revenue up 30% to US$20.97m from US$16.74m achieved same period last year, domestic revenue was up 28% from US$9.05m to US$11.60m. Foreign revenue was up 32% from US$7.12m to US$9.37m.
The increase in revenue was due to growth in occupancy to 53% from 43% as all markets posted an increase in room nights, eight percent in ADR from US$89 reported in SPLY to US$97.
Resultantly total RevPar increased 31% from US$68 reported SPLY to US$90”.
He said the business remained under pressure from cost increases and the impact of foreign currency shortages on the market.
Going forward he said leisure, conferencing and election related business will drive occupancy and renovations are underway at their Hwange property to create a conferencing centre.
He said the group will continue to adopt flexible pricing to accommodate the regional market affected by the strong USD.
“The Leisure and conferencing business are to drive occupancy in our hotels, during the peak season of June-November. Election related business is already coming through and we expect positive impact during the third quarter. Full performance expected to be above both budget and SPLY should the current momentum continue.
Cost management initiatives in place to align revenue to performance while finance costs to continue on a downward trend due to steady repayments”.
Meanwhile African Sun chairman Herbert Nkala stepped down from the board at the agm.