Brainworks reaps the benefit of Zimbabwe’s improved tourism sector
A firming in the value of the rand is likely to boost tourist arrivals from SA to Zimbabwe where the performance of weak regional currencies against the dollar led to flat room rates for hotels such as Victoria Falls Hotel, Elephant Hills and Monomotapa — all of which are run by Brainworks.
In its first full-year results following the company’s listing on the JSE in October, Brainworks said on Friday that signs of a strengthening rand augured well for arrivals from SA.
Even then, in the year under review, growth in hotel occupancy was recorded in all three-market segments, with the international market recording the highest growth of 29%, domestic 17% and regional 3%. The increase in traffic was strongest in Victoria Falls following the commissioning of the upgraded Victoria Falls International Hotel.
Brainworks is a Mauritian, diversified investment holding company with an exclusive focus on Zimbabwe. Its portfolio offers exposure to prominent Zimbabwe-based assets in the hospitality sector, as well as in real estate and financial services logistics.
The company is involved in some of the country’s top hotels, including Meikles Hotel. It is currently pursuing a secondary listing on the Zimbabwe Stock Exchange.
The group says the tourism industry is expected to continue growing in 2018 and would benefit from key activities, including the upcoming general elections, infrastructure development and other government projects.
The Zimbabwean government is set to introduce measures to rejuvenate the tourism and hospitality industry. These include changing the visa regime to enable tourists to apply for visas at the port of entry, introducing systems that would speed up immigration clearance time, and opening the skies to other international airlines.
Brainworks’ revenues rose 22% to $58.6m from the year before. The hospitality division contributed 88% of turnover, which represented growth of 19% in its revenues. Driving growth was the increase in hotel occupancy to 52% from 44%.
However, the group recorded a loss before income tax of $6m, compared to profit before income tax of $4.4m the year before.
Key objectives by the group for 2018 will be to raise capital to restructure the company’s debt, as well as consolidating and strengthening portfolio companies. Brainworks said its directors "believed that the group’s assets are anchored in an improvement in the social, political and economic fortunes of Zimbabwe, which is now imminent".