Cresta generates P50 million
Leading hotel group, Cresta Marakanelo realised P50 million from operations in 2012. According to the just released results, the cash was used to finance the purchase of property, plant and equipment for the refurbishments of some of the hotels. The group achieved a profit after tax of P20.5 million. The commentary accompanying the results states that the results were achieved after taking into account additional lease charges (over and above actual rentals paid during the period under review) of P5.9 million arising from com- plying with International Standard Number 17 (IAS 17), Leases.
In accordance with IAS 17, rentals on leased properties have to be amortized after taking into account escalations dur- ing the lease period) in equal installments over the lease period. Since the account- ing standard does not allow discounting for the time value of money over the lease period, a portion of future lease increments was accounted for during the period under review, even though it was not due and payable. Group revenues achieved were P243 million for the period under review, says the statement signed by board chair- person, Maria Nthebolan. Cresta’s revenue was achieved on the back of average room rates of P763 and average occupancies of 61 percent.
According to the report, the Cresta achieved an operating profit of P27 million, which is an operating margin of 11 percent for the period under review to the nine percent achieved in the financial year ended 31 December 2011. The Botswana Stock Exchange (BSE)- listed company has garnered much growth with the P20 million used to buy the businesses of Golfview Hotel Ltd, Zambia, in 2012. The group not only had regional expansion, they also opened their doors to a new local hotel, Cresta Mahalapye, in February this year. The shareholders’ funds increased from P102 million at 31 December 2011 to P116 million at 31 December 2012. The increase was largely due to profit achieved during the period under review, said the state- ment. Shareholders will earn a 4.4thebe dividend payout.