Government’s emphasis on infrastructural development spurs tourism group on

Rainbow Tourism Group (RTG), a prominent player in the hospitality industry, is buoyed by the Government’s emphasis on infrastructural development saying it is crucial for boosting tourism and improving inter-city travel.

In a statement accompanying the group’s financial results for the year ended December 31, 2023, RTG board chairperson, Douglas Hoto said the investment in strong infrastructure not only aids the hospitality sector but also spurs overall growth and connectivity.

The hospitality group adds that it has demonstrated agility by consistently refining its business model and leveraging technology has been a key strategy to enhance operational efficiency and foster deeper engagement with customers.

“Our ability to adapt swiftly to these conditions has been pivotal. We have remained agile, continuously refining our business model and leveraging technology to boost operational efficiency and deepen our engagement with customers.

“The outlook remains positive. We draw encouragement from the Government of Zimbabwe’s focus on infrastructural development, which is fundamental in fostering tourism and enhancing inter-city travel.”

Mr Hoto said the 2024 revenue forecasts point toward a robust performance, fuelled by the recovery of regional and international business.

Notably, domestic business has demonstrated consistency even after the challenges posed by the Covid-19 pandemic.

The Group anticipates significant benefits from the growth of leisure tourism in the Victoria Falls market and national conferencing activities.

Volumes are projected to improve city hotels’ accommodation and conferencing activities.

“Domestic business has proved to be consistent post-Covid-19 pandemic and is anticipated to grow driven by the national infrastructure development projects being rolled out by the Government of Zimbabwe.

“The Group can reap significant benefits from the growth of leisure tourism in the Victoria Falls market and national conferencing activities. Volumes are projected to improve for city hotels, accommodation and conferencing activities. The Company will explore collaborations with partners to unlock shareholder value, leveraging strategic alliances and innovative partnerships to drive sustainable growth.”

Mr Hoto said RTG is poised to explore strategic collaborations and innovative partnerships. These endeavours aim to unlock shareholder value, foster sustainable growth and strengthen RTG’s competitive standing in the market.

During the period under review, the Group witnessed a substantial increase in foreign currency business.

The increase was driven by regional and international business, which together grew by 129 percent.

Resort hotels experienced a notable performance improvement, with occupancy increasing by 44 percent to 52 percent in 2023 from 36 percent in 2022.

City hotels, despite recording increased revenues, posted lower occupancy, primarily due to the reduced amount of business activity during the first half of the year.

The Group maintained its gross profit margin at 72 percent over the past two years, which is within the industry benchmarks.

The gross margins were achieved despite a year-on-year inflation rate of 314 percent as of 31 December 2023 and gross margins were sustained through rigorous cost reduction initiatives aimed at mitigating the effects of escalating market prices and unstable foreign currency exchange rates.-chronicle