Tsogo buoyed by profit rise

Visitors are seen at the entrance of Gold Reef City and casino which is owned by Tsogo Sun, in Johannesburg

Visitors are seen at the entrance of Gold Reef City and casino which is owned by Tsogo Sun, in Johannesburg

Published May 24, 2017

Share

Cape Town - South African hotel, gaming and entertainment

group, Tsogo Sun says it expects to complete the building of its 125 room Stay

Easy hotel in Maputo in the current financial year for $16 million as it is buoyed

by a 6 percent rise in profits for the year ended March. 

The company says, on top of adding to its African

footprint, it will also be on the prowl for international acquisitions in the

year ahead

“The acquisition of additional hotel properties by

International Hotel Properties Limited, which currently owns nine hotels in the

United Kingdom, is anticipated in the future and the group may apply additional

capital in this regard,” says the company.

The group’s total income for the period under review

increased by 8 percent to R13 billion, driven largely by a 2 percent increase

in its gaming business and an 11 percent surge in rooms revenue.  The

group grew its adjusted headline earnings per share by 6 percent in the

period to 207.6 cents. Tsogo declared a total dividend of 104 cents, up 6

percent from the comparative period

The company suffered a R38 million forex loss in its

offshore business.  However this was offset by a strong 11 percent growth

of its earnings before interest, income tax, depreciation, amortisation,

property rentals, long-term incentives and exceptional items, which rose to R5 billion

in the period

The company says cash generated from operations for the

year improved by 9 percent compared to the previous period to R4.8 billion.

Read also:  PICS: Tsogo Sun's R700m city hotel to open in September

Net finance costs increased by 34 percent due to the

increase in net debt, while taxation paid reduced by 5 percent-the group

attributed this to refunds it has received from the South African Revenue

Service in the period.

The group says it is well positioned to weather the weak

economy and policy uncertainty from government in areas like visa regulation to

gaming taxes. 

“The group remains highly cash generative and is

confident in achieving attractive returns from the growth strategy once the

macro-economic environment improves,” the company says.

BUSINESS REPORT ONLINE

For more on this, pick up a copy of Business Report tomorrow.

 

Related Topics: