African Sun revenue plunges 55 percent

African Sun runs an array of prestigious hotel brands which include The Victoria Falls Hotel, Holiday Inn, Great Zimbabwe Hotel and The Caribbea Bay Resort.

0
400
  • Revenue came in at ZW$1.84 billion
  • Occupancy declined by 25 percentage points
  • UNWTO expecting a rebound in world tourism in the second half of the year

Harare – Hospitality management company with operations in Zimbabwe and South Africa, African Sun has recorded a ZW$2,26 billion decline in revenue for the year ended 31 December 2020 to close at ZW$1.84 billion from ZW$4.10 billion in the prior year representing a 55 percent decline in earnings as COVID-19 took its toll.

Complementarily, occupation levels dived by 25 percentage points to 23 percent from 48 percent in 2019 while room nights sold went down by 52% to 137,162 from 288,224 reported last year.

Resultantly, the group saw a loss of before tax of ZW$1.86 billion “as a result of the monetary loss of ZWL1,50 billion, which is a result of applying International Accounting Standard (IAS) 29 Financial Reporting in Hyperinflationary Economies,” African Sun said

“COVID-19 represents the most significant challenge that our industry has ever faced. At the onset of COVID-19 induced lockdowns, we moved swiftly to right-size our business in response to the precipitous decline in revenue by rebasing our cost structure, strengthening our balance sheet, and lowering capital spending,” the company said, explaining the slump in performance.

The pandemic has however not only weighed on African Sun but all other hoteliers and players in the tourism sector in Zimbabwe and the world over.

Industry mate, Rainbow Tourism Group (RTG) has reported a 66 percent decline in revenue and a fall in occupancy by 21 percentage points for the year ended December 31, 2020 also as a result of the prolonged hard-hitting effects of COVID-19 on the tourism sector.

At the same time, the United Nations World Tourism Organisation (UNWTO) says international tourist arrivals to Africa fell by 85% in January 2021 but they are however confident of a bounce back under one of two different scenarios, later on in the year.

“The first scenario points to a rebound in July, which would result in a 66% increase in international arrivals for the year 2021 compared to the historic lows of 2020. In this case, arrivals would still be 55% below the levels recorded in 2019.

The second scenario considers a potential rebound in September, leading to a 22% increase in arrivals compared to last year. Still, this would be 67% below the levels of 2019,” they said.

African Sun runs an array of prestigious hotel brands which include The Victoria Falls Hotel, Holiday Inn, Great Zimbabwe Hotel and The Caribbea Bay Resort.

Equity Axis News

LEAVE A REPLY

Please enter your comment!
Please enter your name here