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Chobe revenues surge on higher bednight sales

ISAAC PINIELO
Rebound: The tourism industry appears to have fully recovered from the 2015 slump
Botswana Stock Exchange-listed Chobe Holdings Limited has reported a surge in both revenue and profit, as the tourism hospitality group got a boost from higher bednight sales.

The group, which owns and operates eleven eco-tourism lodges and camps on leased land in Botswana and Namibia, said its revenue for the half-year to August 31, 2017 was P176.4 million.

That was an 11% increase from P158.6 million in the corresponding period last year.

The group’s profit after tax for the period was up to P55.1 million from P47.2 million last year. The group’s occupancy also increased by seven percent when compared to the same period in prior year.

Chobe Holdings chief executive officer, Jonathan Gibson said this is considered satisfactory in light of continued uncertainty in the world economy and reduced capacity caused by continued improvements at Chobe Game Lodge.

He said the increase in revenue was recorded as a result of the increase in bednights sold, adding that the negative effect on revenue as a result of the appreciation of the pula against the dollar was countered by an increase in achieved bed rates in US dollar terms.

“An operating cost increase of 11% is considered satisfactory in light of the volume of business and current inflation levels,” Gibson said.

He further noted that the group spent P10.3

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million, financed from internally generated cashflows, on improving existing equipment, buildings, as well as the purchase of additional equipment.

In addition, during the period under review, the group took up a 22% stake in Golden Wrap, an aquaculture entity operating in Kasane.

He said the group’s total investment in this entity when fully paid will be P6 million.

He said Chobe’s wholly-owned subsidiary, Ker & Downey Botswana, acquired the entire shareholding and shareholders’ loans in Dinaka Safaris, Flavoured Properties, Horizon Deep and Sunbelly Ventures with effect from September 1, 2017 for a cash consideration of P56 million.

While the Southern African tourism industry is seen sustaining its robust growth in the medium term, Gibson has red-flagged risks from political uncertainty in the Northern hemisphere.

He noted that political uncertainty in that region, if exacerbated, could result in a significant decline in tourist arrivals in Botswana in general and the group in particular.

“The majority of the group’s clientele come from the Northern hemisphere,” he said.

However, Gibson was hopeful that the group’s strong cash position provides it with an opportunity to take advantage of expansion opportunities that may arise.



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