HARARE: Rainbow Tourism Group (RTG) has slipped into a $1,9 million loss in the half year ended June 30 2015 from a profitability position in the comparable period in 2014 due to a decline in revenue and increase in operating expenses.
In the comparable period in 2014, RTG posted a profit of $139 211. Revenue declined by 8% to $12,4 million from $13,5 million in 2014. Cost of sales declined to $4,5 million from $4,8 million in 2014. Other operating income grew to $246 209 in 2014 while operating expenses grew to $7,6 million from $7,2 million in 2014.
In a statement accompanying the group’s abridged unaudited interim consolidated financial results, RTG chairperson John Chikura said the revenue performance was negatively impacted by low conferencing activity in the first four months of 2015.
Chikura said the decrease in foreign business which is mainly driven from South Africa was due to the weakening of the rand rendering Zimbabwe an expensive destination.
“The group is confident of a full recovery by the end of 2015, as the second half of the year contributes 60% to the group’s annual revenue. We anticipate better performing foreign arrivals and an upsurge in conferencing activities, which will be buoyed by the upcoming international conference being hosted by the Ministry of Health and Child Care in the last quarter of the year. This conference is set to attract over 7000 delegates into the country,” Chikura said.
In the period under review, the group revenue per available room (RevPar) decreased by 6% to $30 from $32 recorded same period last year.
He said the drop in the groups RevPar was due to rate softening and lower occupancies during the period compared to the corresponding period last year. “The group continued to pursue its pricing model which is aimed at promoting domestic tourism in order to boost activity in all its hotels.
“The group launched a series of promotions including new weekender rates, RTG online auctions and the Rainbow Delights menu. These programs are meant to minimize the impact of liquidity challenges in the domestic market,” he said.
