- Key highlights for the full year of 2021
Zimbabwe Stock Exchange (ZSE) listed hospitality group, Rainbow Tourism Group (RTG) says it will continue to capitalise business operations online to realise growth amid huge setbacks from the COVID-19 pandemic.
The Group which suffered a profit after tax decline of 61% to ZWL 218 million during the full-year ended 31 December 2021 said this performance was anchored by technological innovation courtesy of the Gateway Stream mobile and web platform followed by the traditional hospitality business with its robust cash flow streams and new tour operations arm that is a key enabler of travel and experience tourism.
The online platform registered a 340% growth in active subscribers to 66 000 during the period. The Gateway Stream, owned by Rainbow Tourism and launched in 2020 allow users to browse, book and pay for their products and services within a short space of time, without going to the physical premises of the group.
The app played a fundamental role during the period to alleviate COVID-19 restrictions which impeded mass mobility of people who were encouraged by the law to practise social distance and remain indoors possible.
“I am pleased to report that the platform is now accessible free of data charges on some internet service providers and mobile network operators in Zimbabwe.”
“The growth trajectory of Gateway Stream is anticipated to continue through various partnerships that have now been established with leading social influencers who are well set to channel significant volumes through Gateway Stream,” said the group in a statement accompanying the full-year results.
Revenue during the period grew by ZWL2.8 billion from ZWL2.4 in 2020 while finance income declined by 70% to ZWL49 000 due to a decline in cash generated from operations to –ZWL73 million from ZWL558 million during the 2020 period.
The hotels business recorded a 29% growth in occupancies to 31% from 24% recorded in 2020 buoyed by the domestic market driven by city hotels.
The group said the business volumes improved significantly in the last quarter of 2021 buoyed by accommodation and outside catering and it further anticipates that rooms and conferencing business will continue to recover in city hotels into 2022.
Meanwhile, the group inked in ZWL92 million towards capital expenditure projects which mainly focused on capacitating the new business units as well as the basic care and the maintenance of the hotels.
The subsidiary, New Ambassador Hotel went under refurbishment of rooms and public areas while the installation of a brand-new guest elevator commenced in January 2022 and is now complete, the first time since its construction that the hotel replaced its elevator.
“The rooms refurbishment works will commence in the second half of the year to complete the facelift of the hotel and firmly position it as a city centre boutique business hotel, “added the group.
The Kadoma Hotel and Conference Centre was also part of the projects set for refurbishment. The project involves the structural refurbishment of selected blocks of the hotel and the scope of works will focus on the replacement of the entire roofing and accompanying aspects such as ceilings modernisation and freshening of the affected rooms.
The Group invested in the upgrading of Rainbow Towers Hotel guest rooms and two guest elevators.
“The remaining works which were stalled by COVID-19 lockdowns have resumed and are expected to be completed during the second half of the year.”
“These include the refurbishment of suites, as well as the installation of a third elevator, which was installed and commissioned on 30 March 2022,” said the group.
As a result, the investment income during the period soared by 1594% to ZWL164 million from ZWL9.7 million last year.
As part of its sustainability strategy, the group commenced rolling out green energy initiatives. The first project was the rolling out of a 300 KVA solar system at Kadoma Hotel and Conference Centre. Adequate enough to support the energy requirements for the entire hotel, the installation of the system commenced on the first of March 2022 and is expected to be commissioned during the second quarter of the year.
However, the group should be prepared to brace for higher inflation risks due to the fast depreciation of the local currency. Inflation affects the functioning of the company as it affects the purchasing power of the money. Rising inflation will keep on weighing on the company’s wage sector and ultimately affect the customer’s purchasing power. According to the group’s financials, its main market lies in Zimbabwe and it is going to face immense pressure to obtain the greenback. The increase in interest rates.
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