eBusiness Weekly
Enacy Mapakame
Tourism is booming in Zimbabwe, and companies in the sector have now started to report stronger profits, even during periods traditionally considered off-peak, according to industry figures.
The expansion is largely fuelled by opportunities created by the new dispensation, led by President Mnangagwa, which has opened a new page in international relations.
Figures from Zimbabwe’s top three tourism and hospitality firms — African Sun Limited, Meikles Limited and Rainbow Tourism Group (RTG) — during the first five months of 2018 show a marked increase in earnings and hotel occupancies.
Revenue is up 30 percent to $21 million at African Sun Ltd from the comparable year ago period, after foreign arrivals soared 24 percent in the review period.
Average occupancy rose to 53 percent.
African Sun Ltd says revenue from foreign tourists climbed 32 percent to $9,4 million, and domestic revenue 28 percent to $11,6 million. Average daily rate also increased to $97 from $89 in the same period last year.
The growth at Africa Sun cascaded to Dawn Properties, who manage the hospitality group’s hotels and other properties.
During the five months to May, 2018, Dawn’s revenue increased 27 percent to $2,2 million compared to same period last year. The company said, property income from hotels and time shares was 33 percent higher than the same period last year on the back of good performance in the hospitality industry.
“Trading conditions improved significantly for our tenant African Sun, with a better than expected performance in what is traditionally their low peak period,” Dawn said.
For RTG, revenue for the period under review jumped 16 percent to $11 million from $9,6 million as occupancy level increased to 55 percent compared to 52 percent in the prior year comparable period. Arrivals into RTG hotels increased 27 percent while foreign revenue increased by 23 percent to $3,6 million.
Meikles executive chairman John Moxon, indicated the first three months of the group’s current financial year had started on a good note.
In the year to March 31, 2018, the group’s pretax profit jumped 225 percent to $19 million while revenue increased to $534 million from $457 million spurred by good performance in agriculture and hotel business.
Infrastructure refurbishment programmes have also played a critical role in the growth of the tourism industry.
The commissioning of the refurbished Victoria Falls International Airport was instrumental in increasing accessibility into the country while additional disposable incomes as a result of heightened economic activity cannot be overlooked.
The country is ranked 114th out of 141 in the World Economic Forum’s 2017 Travel and Tourism Competitiveness Index, and is expected to experience a boom in tourism this year, with tourist arrivals projected to reach 2,5 million, on the advent of heightened economic activity following last year’s political reforms.
“The projection of 2,5 million tourist arrivals in 2018 is attainable as the government intends on relaxing the visa policy for tourists to incentivise international tourists.
“Furthermore, the thrust is to strengthen destination marketing, paying special attention to high-spending markets to increase tourism receipts in 2018,” said brokerage firm IH Securities in their 2018 Equities Strategy report.
The sector is also engaging in room expansion in anticipation of the increased demand while further improvements on transport infrastructure for increased connectivity is seen as creating an enabling environment for the sector.
Dawn Properties indicated it has undertaken hotel improvement plan. At Amber Hotel in Mutare, the group has undertaken to replace guest elevators. The project should be completed by end of this month while African Sun is also refurbishing rooms for the Holiday Inn brand to improve their ambience and appeal to customers.
RTG said it would continue on the refurbishment of its hotels with focus on Rainbow Towers Hotel, Bulawayo Rainbow Hotel and New Ambassador Hotel after recent completion of the Victoria Falls Rainbow Hotel.
Meikles has also indicated plans to refurbish and expand its Victoria Falls Hotel. The country’s tourism and hospitality sector is poised to maintain the growth trajectory in the remainder of the year and going forward.
The harmonised elections set for July 30, will also boost room occupancy as observers from across the world flock the country.
