Audrey Galawu- Assistant Editor
In a hospitality sector battered by currency volatility, rising costs, and global uncertainty, African Sun Limited is pivoting towards a streamlined, locally grounded future.
The hotel asset management company is doubling down on high-performing properties, digital transformation, and targeted capital investments to boost profitability, even as it exits legacy assets and braces for reduced room inventory in 2025.
Despite a challenging macroeconomic environment marked by a 43% devaluation of the newly adopted Zimbabwe Gold currency and increased operating costs, the Group reported a 15% increase in revenue from continuing operations, rising to US$53.98 million from US$46.98 million in 2023. Occupancy grew to 59%, up from 55% the previous year, while EBITDA rose 21% to US$9.88 million.
However, the Group swung into a net loss of US$0.69 million, compared to a modest profit the prior year.
“Positive gains in revenue, occupancies and rates were eroded by even higher associated costs of doing business, plus once-off, non-recruiting expenditures,” Chief Executive Officer Laurie Ward noted in the 2024 Integrated Annual Report.
The company has embarked on an aggressive portfolio transformation strategy, selling off underperforming or non-core assets — including the Great Zimbabwe Hotel and Sun Leisure Tours — while earmarking Monomotapa Hotel and Caribbea Bay Resort for sale. The rationale: concentrate resources on premium locations and refurbishments to elevate guest experience and profitability.
“This vision will continue to gain momentum in 2025. Our approach involves divesting non-core assets and concentrating resources on high-performing properties in prime locations,” said Ward, outlining the Group’s strategy shift.
The move comes as African Sun prepares to invest further in its flagship properties. In 2025, refurbishments are planned for Holiday Inn Harare, Holiday Inn Bulawayo, and Elephant Hills, along with the second phase of renovations at The Victoria Falls Hotel and Marlborough Sunset Views residential development.
While hotel revenues remain the core engine, the Group’s Real Estate division is gaining traction, contributing US$3.02 million to 2024 revenue — a jump from just 2% to 6% in share. The second phase of the Marlborough Sunset Views residential project, targeting 55 stands, is expected to further boost liquidity and non-hospitality income streams.
African Sun declared a total dividend payout of US$1.5 million in 2024, signaling confidence in its long-term strategy despite short-term pressures.
Yet the Group remains wary of geopolitical developments, particularly the U.S. suspension of aid funding, which could dampen demand from NGO and government clients. Local challenges such as subdued government expenditure and liquidity constraints also loom large.
Even so, leadership remains cautiously optimistic. “We expect demand for our hotels to remain stable… the steps to upgrade our properties will undoubtably assist with this realisation,” Ward stated.
African Sun is also leaning into technology and sustainability. Following a successful pilot of the Opera Cloud PMS and Micros POS systems, the Group is rolling out digital transformation initiatives across all properties.
Meanwhile, its commitment to ESG practices — including a shift away from single-use plastics and improving diversity metrics — aligns with global investor expectations.
Internally, a Graduate Development Programme has seen 26 trainees integrated into the business, with 24 more expected in 2025, reinforcing African Sun’s commitment to human capital development.
While many regional hospitality groups are looking outward, African Sun is going local — and lean. With a refined focus, robust brand partnerships like IHG, and a sharpened investment in technology and real estate, the company is wagering that sustainable profitability lies not in scale, but in precision.
As Chairman Lloyd Mhishi put it, “These strategic capital investments aim to enhance guest experiences and grow the portfolio’s market share”.
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