RTG focuses on debt management

14

RAINBOW Tourism Group (RTG) says it will continue to focus on building a sustainable balance sheet with manageable debt levels.
The hospitality group said it managed to extinguish its debt and maintained a robust plan to sustain the existing solid working capital base last year.
“Cost containment will continue to be a focus area. This will ensure profitability and improvement in cash flows,” the group said in its 2022 annual report.

During the period under review, RTG’s occupancy levels closed at 51 percent compared to 31 percent in the prior year.
“Our revenues and occupancies are now performing above pre-Covid-19 pandemic levels. Given the uncertainty and volatility characterising the Zimbabwean business landscape, the group had to consistently implement various strategies to maintain profitability,” RTG said.
RTG’s revenue per available room increased by 212 percent to $41,749 during the year under review.
The group posted revenues of $24,5 billion during the year, 131 percent above the $10,6 billion posted in the prior year.
“Despite increased pressure from inflation, the group’s gross margins for the year under review remained unchanged at 70 percent compared to 2021. The improvement in gross profit margins is attributable to cost reduction measures that were put in place to mitigate the effects of increasing prices in the market,” the group said.
Inflation-adjusted profit from operations for the period under review surged by 113 percent to $2,29 billion during the year ended December 31, 2022, from $1,07 billion recorded in the comparative period due to recognising and seizing opportunities in a variety of non-hotel ventures and hotel upgrades.
The hospitality group highlighted that the current financial performance, along with the performance over the previous years, is evidence of a robust and profitable company with a sustainable development track. RTG closed the year with a profit from operations margin of nine percent.
“The positive growth reported in 2022 is expected to continue into 2023 as world tourism activities return to pre-Covid-19 levels. The group has recorded a sustained recovery of international tourists in 2022 and the trend is projected to accelerate going forward,” the group said.
The group reported earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $2,7 billion, a 29 percent increase over the $2,1 billion reported in 2021.
“Strong revenue performance coupled with a relentless grip on costs were key drivers to a healthy EBITDA performance,” the group said.
newsdesk@fingaz.co.zw