Wesbank

Chobe profit goes up 

SHARE   |   Tuesday, 30 May 2017   |   By Kabelo Adamson
Savute Safari Lodge [INSERT-Group CEO Jonathan Gibson) Savute Safari Lodge [INSERT-Group CEO Jonathan Gibson)

Chobe Holdings Limited fears political uncertainty associated with the Donald Trump administration in the US and other geo-political events in the Northern hemisphere could impact on its profitability. The tourism company said in its audited financial results that for the year ended 28 February 2017 that the above events create volatility to the US Dollar which is the company’s main revenue trading currency. Chobe, which owns and operates a number of eco-tourism lodges and camps in northern part of the country, says a loss in value of the US Dollar would naturally have a negative impact on its earnings. Group CEO Jonathan Gibson said efforts by the ministry responsible for tourism through Botswana Tourism Organisation (BTO) of exposing the country internationally as a destination of choice are anticipated to result in more tourists visiting the country and its lodges. Chobe, which is one of the two tourism companies on the Botswana Stock Exchange (BSE), expects its profits to better the one registered this year. It recorded a profit after tax of P64 million from P56 million from last the same time. Gibson says Chobe continues to invest heavily to improve its marketing strategies, product offerings and cost controls. “These initiatives are anticipated to translate into satisfactory results for the forthcoming financial year,” said Gibson, who serves as Chobe Deputy Chairman. The Chobe boss believes its strong cash position provides it with the opportunity to take advantage of any expansion opportunities that may arise.

The group, which has its lodges and camps concentrated around the northern part of the country where most tourism facilities are found, has seen occupancy level increase by 4 percent during the year under review, a suggestion that more tourists continues to flock the country. Gibson said the increase is considered satisfactory in light of myriad of issues affecting the world economy, cheaper alternative destinations in the region and reduced capacity as a consequence of continuing lodge renovations and refurbishments. As a result, Chobe saw an increase in its revenue to P270 million from P210.1 million achieved during the same period last year, primarily from an increase in bed nights sold, favourable exchange rates in peak season and a marginal increase in achieved bed night rates in US Dollar terms as well as the contribution from the newly acquired, wholly owned, aircraft maintenance organisation. The group had in March last year announced the acquisition of Maun aircraft maintenance operation of Air Charter Botswana (Pty) Ltd at a cost of P18.4 million. “The operation has made a positive contribution to the Group’s bottom line for the reporting period,” said Gibson, adding that financial contribution from this acquisition is anticipated to be fully realised in the forthcoming financial year once the entity has been fully integrated into the group.