RAINBOW Tourism Group said revenue for half-year ended June declined 8 percent to $12,4 million compared to the same period last year due to low conferencing in the first four months while a weakening rand negatively affected arrivals from South Africa. The company recorded a loss of $1,9 million compared to a profit of $139 000 in the previous comparable period while operating expenses rose to $7,6 million from $7,2 million.
Net finance cost was $1,2 million, up from $978 000 in the first half of 2014. Occupancy rate was down 5 percent from 43 percent to 41 percent, the group said. Revenue per available room decreased by 6 percent to $30. “The drop in the group’s available RevPAR was due to rate softening and lower occupancies during the period compared to the corresponding period last year,” RTG said on Friday.
The group reported that its total debt decreased to $21,1 million from $22,2 million as at the end of last year, while the cost of debt reduced to 10 percent from 11 percent recorded during the same period last year. Gearing increased to 58 percent as at half-year from 56 percent at the close of 2014. In terms of capital expenditure during the period, RTG spent $1,1 million, mainly towards upgrade its hotels. The capex was funded through internally generated cash flows.
The group also spent $1 million on refurbishments of the Rainbow Towers Hotel and Conference Centre’s conferencing facilities. Refurbishment work is also on-going at the Kadoma Hotel and Conference Centre and the Victoria Falls Rainbow Hotel. Going into the second half the group expects an improved performance as it typically contributes 60 percent of RTG’s yearly revenue. The board resolved not to declare an interim dividend for the just ended period.