eBusiness Weekly
Enacy Mapakame
Hospitality group African Sun will spend over $2 million in the last quarter of 2018 towards refurbishing its hotels to international standards to tap into anticipated increase in tourist volumes during the period.
This comes as the group recorded significant earnings growth in the first half of this year, despite it being the off peak season.
The last quarter of the year falls within the tourism and hospitality sector’s peak trading season, when more tourists visit the country.
African Sun chairman Alex Makamure said the group anticipated the Victoria Falls hotels to experience growth in foreign arrivals which should help it to maintain its growth trajectory from the first half of the year when domestic and foreign revenue grew by 26 percent and 32 percent, respectively.
“In anticipation of increased occupancy in the future, we have rolled out a refurbishment programme to bring our hotels to regional and international standards.
“To this end, the company is set to spend US$2,1 million in the last quarter of 2018 in refurbishments,” he said.
Makamure said the group would also focus on revenue generation and cost reduction initiatives to navigate current challenging business environment, leveraging on its regional and international brands and their respective loyalty programmes.
During the first half of the year, African Sun’s operating profit surged 672 percent to $3,8 million on strong business performance driven by brisk activity during election period.
Revenue rose 29 percent to $27 million as volumes increased at all its hotels. Basic earnings per share rose 1 700 percent to 0,36 cents from 0,02 cents in the comparable prior year period.
During the first half of the year, Zimbabwe witnessed an increase in foreign arrivals as observers from all over the world flocked the country to observe the election. The election campaign period was generally peaceful, and economists have said this should continue boosting investor confidence across sectors of the economy during the remainder of the year and going forward.
Isolated incidents of violence during the election period however resulted in some cancellations or deferment of some bookings especially in city hotels.
Management is, however, upbeat the anticipated increase in business during the peak season will offset any losses incurred during the election season.
“We are confident that we will recover from the lost business in the remaining part of the year as our confirmed bookings are already higher than same period last year for most of our hotels,” he said.
Additionally, the group also anticipates to cash in on various infrastructure projects in the country that are expected to bring in business in the hospitality industry.
These include the upgrading of the Robert Gabriel Mugabe International Airport, the Beitbridge to Chirundu road rehabilitation and Beitbridge border post development.
The Africa Sun group has four divisions, hotels under management, hotels under franchise, owner managed hotels and the Victoria Falls Hotel partnership. Its hotels are located in all the tourist resorts in Zimbabwe, and also operates timeshare units and casinos throughout the country.
