- Group records 13% year-on-year revenue increase to P400 million
- Heightened activity in meetings and events noted as a factor
- 50-room Cresta Jwaneng Hotel singled out for special mention
- Report note proliferation of Airbnb and rooms across the country
GAZETTE REPORTER
With the aim of solidifying its position as the cornerstone of Botswana’s burgeoning tourism and hospitality sector, Cresta Marakanelo Limited has unveiled ambitious plans for the year 2024.
Writing in the company’s latest financials for the year ended 31st December 2023, Chairman Moatlhodi Lekaukau and Managing Director Mokwena Morulane underscore Cresta’s commitment to expansion and refurbishment initiatives aimed at elevating guest experiences across its portfolio.
Top strategic priority
“Our top strategic priority for the year ahead is the continued implementation of expansion projects and advancing refurbishments of our existing asset portfolio,” the two state.
Central to this endeavour is the imminent completion of the 50-roomed 4-star Cresta Jwaneng Hotel in the diamond mining town, a project undertaken in collaboration with Debswana Pension Fund as development partner.
Anticipated to be unveiled to the market in the second quarter of 2024, the Cresta Jwaneng Hotel signifies a significant milestone in Cresta Marakanelo Limited’s commitment to enhancing accommodation offerings in Botswana.
Digitalisation
Furthermore, Lekaukau and Morulane emphasise the importance of digitalisation and maintaining service excellence as integral components of Cresta’s strategic vision.
They affirm that the Board and Management of the company remain dedicated to vigilantly monitoring and proactively responding to the dynamic landscape of the hospitality industry.
The financial report for the year 2023 showcases remarkable growth for the Group, with revenue soaring to P400 million, marking a noteworthy 13 percent year-on-year increase.
Lekaukau and Morulane have attributed this remarkable achievement to various factors, among them amplified business from standard tour operators, heightened activity in meetings and events at leisure destination hotels such as Cresta Mowana Safari & Spa, and enhanced conferencing and food and beverage offerings in city hotels.
Operational efficiency
They also highlight the positive impact of revenue management strategies implemented following extensive hotel refurbishments conducted during the year.
Operational efficiency was another highlight of Cresta Marakanelo Limited’s performance, with operating profit reaching P58 million, a notable 28 percent surge compared to the previous year.
Profit before tax witnessed an impressive 57 percent increase over the same period.
The company’s profitability margins also witnessed an upward trajectory, with operating profit margin closing the year at 15 percent and profit before tax margin at 8 percent, reflecting a marked improvement from the previous year’s figures.
Since COVID
Furthermore, Cresta Marakanelo Limited reported earnings before interest, tax, depreciation and amortisation (EBITDA) of P104 million, representing a commendable 15 percent improvement over the prior year’s performance.
Notably, the company made a significant contribution of P4.7 million in corporate income tax to the government, marking its first year of taxable income since the onset of the COVID-19 pandemic.
To ensure sustainable profitability into the future, Lekaukau and Morulane say the company strategically increased its absolute spend on repairs and maintenance of properties and sales and marketing costs as a deliberate investment.
Staff welfare
They note that this was complemented by increases in the remuneration and welfare of staff and companywide training programmes.
Meanwhile, the two have noted that the company continues to battle headwinds due to the proliferation of Airbnb and increases in rooms across the country, and more so in Gaborone.
“The inflationary pressures, coupled with continued industry price wars, continue to be a key risk to the business,” they state.
“The Board constantly monitors and guides management accordingly on navigating the diverse risks facing the business.”