Brainworks confident about economy
One of the country’s top players in property and tourism sectors, Brainworks Capital, believes the firm is poised to benefit from various infrastructure projects that are taking place in the country as President Mnangagwa’s Government prioritises economic development and growth.
Brainworks Capital, which is listed on the Johannesburg Stock Exchange, owns hospitality concern African Sun, and hotel property owner Dawn Properties.
“Various infrastructure projects across the country, including the Robert Gabriel Mugabe International Airport upgrade, Beitbridge to Chirundu road rehabilitation and Beitbridge border post development present opportunities which the group is set to benefit from,” said Brainworks.
The company, through its subsidiary, is already seeing the benefits of President Mnangagwa’s policies with its results for the half year ended June 30, 2018, showing a 28 percent growth in revenue to $31 million relative to $24 million achieved during the 2017 comparable period.
Chief executive officer Brett Childs attributed the strong performance to growth across all the group’s three main operating segments, with major growth being recorded by the hospitality segment.
“In line with the prior year, the hospitality segment remains the major contributor to group total revenue, with contribution of 87 percent ($27million) in line with same period in the prior year,” said Mr Childs.
The hospitality business segment’s revenue increased by 29 percent to close at $27million compared to $21million recorded over the same period in 2017.
“Both domestic and foreign revenue registered growth, achieving 26 percent and 32 percent respectively,” he said.
Mr Childs noted that the group had witnessed an exceptional increase in both local and foreign arrivals during what would have traditionally been a quiet period.
The first half of the year also coincided with the election period which saw observers from across the globe flocking to the country and filling up hotels.
Revenue for the group was thus boosted by a 10 percentage points increase in occupancy rate to 55 percent during the period under review to 45 percent reported prior year comparative.
Improved hotel occupancy resulted in the average daily rate (ADR) improving to $97 from $89 reported during the comparative period. As a result, revenue per available room (RevPAR) firmed by 33 percent to $53 from $40 achieved last year.
With interest on investing in Zimbabwe also increasing, the sector and Brainworks in particular also benefited immensely and the trend is expected to continue into the future.
“The second half of the year presents the group’s peak trading season. The group expects conferencing and international market business to bolster performance, particularly in our Victoria Falls properties, where inward foreign arrivals have been on the increase,” said Mr Childs in a statement accompanying the groups results released Friday last week.
“We anticipate that the New Victoria Falls Airport will continue to be a conduit for increased foreign arrivals into the destination,” he said.
The group recorded profit after tax of $7,3 million during the period under review, compared to losses of $5,2 million and $8 million for the interim period ended June 30, 2017, and year ended December 31, 2017, respectively.
Earnings per share of the Company is expected to be 7,41 US cents per
The out-turn for Brainworks is to be expected given the performance of two of its local operations that reported significant improved results.
One of the entities, hospitality group, African Sun Limited reported earnings growth for the half year to June 30, 2018 as operating profit surged 672 percent to $3,8 million on good business during election period.
Afsun’s strong performance also translated to an equally good set of results for its landlord Dawn Properties.
The property concern, posted a profit after tax of $942 177, about 9 percent up from $90 442 recorded in the same period last year.