Regional bosses of the Federated Hospitality Association of South Africa Gerhard Patzer and Warren Ozard have had to swallow their words, less than two years after questioning the appointment of Julie-May Ellingson as Chief Executive Officer of Durban’s flagship Inkosi Albert Luthuli International Convention Centre.
Under Ellingson, the ICC has reported its best financial performance ever. This was revealed during a gala 15th birthday celebration at the centre last week.
She said for the 2012 financial year, the ICC generated a record revenue of R237 million, up from R129m in 2011. Profit before tax was R69m, up from R3.4m in 2011.
“It is a common misperception that the ICC costs the city money… The ICC paid over R7m in rates to the city last year. In terms of contribution to gross domestic product (GDP), it came in at R3.11 billion, up from R2.7bn in 2011… Foreign exchange earnings generated was R948m, up from R476m in 2011. Tax revenue generated was R277m, up from R246m in 2011. And, the ICC generated 9 327 new jobs [direct and indirect],” she said.
“The Durban ICC has achieved three significant milestones during 2012… In addition to achieving our 15-year milestone, the ICC has been voted ‘Africa’s Leading Meetings and Conference Centre’ by the World Travel Awards for the 11th time in 12 years. The third has been the excellent financial and performance indicators for the 2012 financial year,” she added.
Ellingson said that in terms of these results, the Durban ICC was the best performing convention centre in the country for the financial year. She said 74 percent of ICC expenditure was with black economic empowerment (BEE) companies and that the venue had improved its BEE rating to level three, up from level seven the previous year.
“The ICC has made a cumulative contribution to GDP of R14.5bn over the last six financial years alone and has put Durban firmly on the global conferencing map. These results demonstrate the tremendous contribution that the ICC has made to the economic prosperity of Durban and KwaZulu-Natal. It reflects the success of the Durban ICC as a municipal entity which is run as a commercial enterprise while significantly contributing to the city’s developmental goals,” she said.
Ozard, who attended the birthday celebration, admitted that he might have been wrong about Ellingson. When she was appointed last year, the tourism industry believed that it was a political appointment aimed at moving her out of her direct municipality role as head of Strategic Projects, before the departure of former city manager Michael Sutcliffe.
“Yes, we were sceptical when she was appointed because she did not have any direct tourism industry experience. We were also concerned about her tough management style. But, it seems that this has worked for the ICC,” he said,
“She has done a good job, but she walked in at a busy time… We also have to realise that the ICC hosted two high-profile events last year – the Olympics Congress and UN COP17 Climate Change Summit, which contributed significantly to the ICC performance. The ICC also has a strong team and is supported in winning major conference bids now by the Durban-KZN Convention Bureau. Headed by James Seymour, this body was only established two years ago and is doing incredible work,” added Ozard.
He also warned that the ICC had more competition then ever before, not just from the centres in Cape Town and Joburg. He said local hotels had upped their game and “bent over backwards” to get conference business.
“One thing is for sure, the ICC is a vital part of Durban’s tourist offering. It has put the city on the global business tourist map and is an integral part in the economic prosperity of our city and province.”
He agreed with Ellingson that the ICC contributed significantly to the sustainability and growth in key economic sectors, including the hotel, restaurant, transport, retail and logistics sectors not just in Durban, but the country as a whole.
Patzer said: “It is difficult to comment on the ICC performance without seeing its financials. News that the ICC has had a record financial year is great and Ellingson and her team must be congratulated on a job well done… However, maybe the ICC’s financials should be published for more transparency and credibility.”