On A Date with On a Date with African Sun
| #1. History 1904, Cecil John Rhodes is hard at work to bring his ambitious plan to reality The plan is to build a railway line from Cape, SA to Cairo, Egypt Part of the enabling infrastructure is constructing Victoria Falls Hotel to accommodate workers. 1951, an expert trout fisherman Herbert Macllwaine opens Troutbeck Resort in Nyanga South African Breweries (SAB) sell its Rhodesia and Nyasaland business to Rhodesia Breweries (RB) RB purchase included SAB hotels resulting in formation of a hotel unit 1968, Stable Hotels is set up to operate RB hotels in Southern Rhodesia 1970, Emerged Railway Properties a company owned by NRZ and Zambia Railways leases Vic Falls Hotel 1974, Monomotapa, Hwange Safari Lodge, Caribbean Bay and Elephant Hills are opened. Meikles Hotel is demolished and 2 years later a new hotel is opened, operated by Southern Sun Hotel (SSH). 1979, Meikles Southern Sun Hotels (MSSH) is born out of SSH becoming the largest hotel chain operator in Rhodesia. 1980, MSSH becomes Zimsun. 1990, Zimsun which is owned by RB now Delta Beverages Corporation is listed on the ZSE. 1991, Holiday Inn a brand of InterContinental Hotel Group (IHG) is introduced in Zimbabwe IHG is a British based multinational hospitality company. 2000, Eversharp formerly owned by Randall Holdings is acquired by Trans Zambezi Industries (TZI). 2001, Beachmont Trading changes its name to ART and is de-merged from TZI. #2. Operations, A hotel asset management company headquartered in Harare, Zimbabwe. Operates company owned properties and third party properties. 3 distinct subsidiaries for, • Hotel operations • Central Reservation • Property management Resort Hotels• Elephant Hills Resort• The Kingdom at Victoria Falls• Hwange Safari Lodge• Caribbea Bay• Great Zimbabwe Sun Leisure, complementary unit which focuses on gaming and ground handling activities• Tours• Casinos Central Reservations According to the group structure there is African Sun Limited Branch The subsidiary’s primary purpose is servicing foreign guests into the group’s hotels. Property DP owns the group’s real estate and manage the properties #3. Competitors, Tourism and hospitality industry highly competitive. African Sun is significant player Key competitors • ASB Hospitality based in Dubai owner of the Meikles Hotel • Rainbow Tourism Group owner of Rainbow Towers, New Ambassador Hotel, A’Zambezi River Lodge • Masawara owned Cresta Hotels owner of Cresta Jameson, Sprayview, Oasis. • Nesbitt Hospitality Group which owns N1 hotels in Harare, Bulawayo and Vic Falls. • Briolette Services owner of Montclair Hotel and Casino. • Palm River Hotel• Dzimbahwe #4. Shareholding, 62.72% of African Sun is controlled by Brainworks Hotels. According to the 2021 annual report there was a significant issuing of new African Sun shares. The share issue was to facilitate the purchase of Dawn Properties. #5. Management,Peter Saungweme – CEO Appointed on the 3rd of January 2022. A former CEO of Arden Capital (formerly Brainworks Capital). This makes him to be familiar with the business since he could see it from an investor point view. A chartered accountant. Spent time as a Financial Controller at Ecobank Zimbabwe. Chief Financial Officer at Cell Holdings a short term insurer and medical insurance. His task will be to transform African Sun into a resilient business after COVID-19. #6. Pitch Benefiting from synergies created by bundling with Dawn Properties. Relaxation of covid-19 restrictions thereby facilitating movement of tourists from source markets namely UK, USA, Europe and China. The conference business has also ramped up and occupancies are rising significantly. Foreign currency retention rates improved. #7. ZSE Trading StatisticsZWL18.12 (USc2.92 @Interbank Rate) per share as at 10/10/2022. 6.4 ZWL per share on the 4th of January 2022. 182.1% YTD Gain vs ZSE ALSI @22.33% YTD 6th on the @ZSE_ZW ranking in terms of year to date movements. 21st most traded stock over the past 3 months to Sept 30 1,423,517,220 issued shares. ZWL26.8bn market cap (US$43.19m @ZWL620/interbank rate) as at 10/10/ 2022 Anecdotes: African Sun once had a dream for being a US$1bn market cap company premised on having 10,000 rooms under management. That bit included forays into Africa, a strategy which has taken a back seat…but who knows…dreams tend to be re-lived once in a while Each week will be on a DATE with a company listed on the ZSE with Martin Mataga an Investment Democrat. Twitter @MartinMataga. The purpose of this thread is to assist investors to have a minimum appreciation of listed firms. Bulls n Bears has made reasonable effort to validate and update the information before circulation but the onus is on the investor consult their financial advisor. Disclaimer: Do not misconstrue this thread as investment advice. DATE companies before you buy their shares. For comments and questions reply to bulls@bullszimbabwe.com |
