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Business Reporter
REVENUES at Rainbow Tourism Group Limited for the five months to May retreaded 14 percent on prior year to $7,6 million while rooms sold dropped by 12 percent.

Occupancy stood at 36 percent during the period under review as the group relied more on individual stay as opposed to the traditional conference market.

However, RTG remains bullish of a recovery in the second half of the year which contains the traditional peak season for both local and international business.

“Positive signs are evident in the May revenue performance which closed at five percent above same period prior year. The company will continue to focus on service delivery and on deployment of identified strategies so as to ensure a net growth in revenues and profitability by the end of the year,” said Mr Tendai Madziwanyika, RTG group chief executive in a trading update to shareholders yesterday.

The city properties led the decline in occupancies due to the shift in the group business. The group registered a 15 percent growth in Zimbabwe International Trade Fair into its Bulawayo Rainbow Hotel.

The Victoria Falls properties posted slight gains of +2 percent growth in revenues. The group experienced a growth of +3 percent in foreign arrivals in the first quarter from the three traditional source markets of USA, Europe and Asia.

“Overall arrivals into Zimbabwe as a destination were down by 20 percent in the first quarter due to the effects of the Ebola virus which had a negative impact on arrivals from Japan, South Korea and China markets. These markets registered an 80 percent reduction in arrivals into Zimbabwe in the period,” said Mr Madziwanyika. He said the foreign business segment will remain a growth area and will be driven through the South African marketing office. RTG continues to focus on containing costs with a view to examine and reduce operational costs in all areas.

During the period under review, cost of sales reduced by eight percent compared to same period last year, direct operating costs dropped by eight percent and utility costs went down by nine percent.

RTG cleaned up its balance sheet and in the past two-and-a-half years realigned staff numbers.

“This read together with the re-energised focus on human capital development is set to deliver superior service at all levels. We believe now the organisation is firm for purposes,” said Mr Madziwanyika.

RTG launched the affordable Rainbow Delights menu in May which is expected to drive Food and Beverages (F and B) revenues across the group.

“Focus on F and B as a significant driver for revenue generation and growth in 2015 will be vital in increasing F and B contribution to 60 percent from 45 percent in the next 18 months,” he said.