Fall in property values result in earnings slump for Tsogo Sun
Adjusted HEPS are expected to be between 3% and 7% lower than in the previous year
Tsogo Sun, which owns the Montecasino precinct and the Southern Sun Hotels brand, says earnings fell in the year to end-March partly because of a decline in property values.
Adjusted headline earnings per share were expected to be between 3% and 7% lower than in the previous year, said the group, which previously announced plans to separately list its hotels division.
Thanks to the acquisition of the Galaxy Bingo and Vukani Slots businesses in late 2017, revenue grew between 16% and 20%.
Earnings were dented by fair-value losses of R449m on the revaluation of investment properties, mainly related to the non-Tsogo-leased hotels in Hospitality Property Fund, from R187m previously.
Adjusted earnings were also affected by the release of deferred tax liabilities in the prior period of R307m on the disposal of assets to Hospitality Property Fund.
Tsogo said it would publish its results on or about May 23.
The group’s shares were 1.2% up at R21.65 on Friday morning.