African Sun says tourism business now above pre-COVID levels, steps up hotel investment

African Sun says hotel occupancy is now above pre-COVID levels, and an anticipated further recovery in tourism is encouraging the company to invest more in its hotels.

In 2023, hotel occupancy rate rose to 52%, six percentage points above 2022 and beating the levels of 46% before the pandemic shut down the tourism sector globally. The company is also making more from its guests; revenue per available room for accommodation increased by 58% to US$57, up from US$36 in 2022. The company expects more recovery in 2024, especially from conferences, and plans to spend more money to refurbish its hotels in preparation.

“The group operated free of debt and had cash and cash equivalents of US$10.87 million as at 31 December 2023. The Group is currently in discussions with leading financial institutions to secure funding to complement its healthy cash balances for deployment in carrying out accelerated material hotel refurbishment projects,” says African Sun.

Last year, the company refurbished 46 rooms at Hwange Safari Lodge and public areas, while work was also done at Troutbeck and the Great Zimbabwe conference centre.

“During 2024, we have planned significant capital investments into enabling Information Technology and further hotel refurbishments.”

A blight in African Sun’s results is a US$890,000 operations loss due to property and equipment impairments when it closed The Kingdom Hotel in Victoria Falls. The company left the hotel in 2023 after failing to secure a long-term lease from the property’s owners. African Sun says the short-term lease on offer was “untenable”.

“This follows the mutual termination of the lease at The Kingdom at Victoria Falls Hotel, due to an untenable lease tenure. The Group will continue looking for suitable expansion opportunities in appropriate locations and with the right timing and funding structures,” says the company.

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