LIVINGSTONE MARUFU
The Rainbow Tourism Group (RTG) is bullish that Gateway stream web and mobile platform will anchor the group’s growth as the hospitality giant pushes for a digitisation strategy that helps the company to navigate Covid-19 effects which restricts movement of tourists.
With the help of the application, the group’s profit after tax grew by nearly half to ZWL$164.2m in the half year ended June 30 2021 from ZWL$110.7m in the comparable period last year.
Having observed that Covid-19 is here to stay, RTG launched the application to help the group during the lockdown periods.
In a statement accompanying half year results, RTG chairman Arthur Manase said the group is transforming its business to be technology-driven in all aspects.
“This will be anchored by the Gateway stream web and mobile platform. The group will continue to explore the various opportunities presented through its digitisation initiatives.
“Through the Gateway Stream, the group will provide a unified global diversified commercial ecosystem, one that creates ownership of markets with multiple residual cashflow streams,” he said.
“These opportunities are all supported by the multiApp architecture of the Gateway Stream. This architecture allows for multiple revenue streams, ensuring value to the various stakeholders.”
During the period under review, the Gateway Stream Music platform hosted the album launch and virtual live-streaming show of one of the country’s current top artists exclusively on the Gateway Stream Music Platform.
He said the successful hosting of the events led to a sharp growth in user subscriptions to 20,000.
The platform has grown its rooms stock to over 50,000 rooms listed across 29 African countries.
The group doubled its rooms stock in Bulawayo for the Zimbabwe International Trade Fair (ZITF) through its RTG Virtual partners listed on the Gateway Stream platform, where 150 rooms (average stay of 7 nights) were sold for ZITF.
Manase said despite business interruptions due to the lockdowns, the group’s gross margins for the period under review closed at 67% up from 63% posted in 2020.
“The improvement in gross margins is attributable to cost reduction measures that were put in place to lessen the effects of low business volumes,” he said.
Occupancy for the period under review was up 1 percentage point to 24% in comparison to the same period prior year where it closed at 23% and this is despite the fact that the group operated for only three months due to the Covid-19 pandemic lockdown restrictions during the first quarter of 2021.
Inter-city travel and social gatherings were prohibited during this time and this had a negative impact as inter-city travel is a major driver for conferencing business, which is a key contributor to revenue generation.
Other key performance measures were also positive, the Average Daily Rate grew by 24% to close the period at ZWL$8,395, whilst the Revenue Per Available Room grew by 31% to ZWL$2,014.
RTG posted a revenue of ZWL$706m which was 53% above ZWL$462m recorded in the first half of 2020.
The group posted Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) of ZWL$161m (23%), which was 9% below the prior-year which closed at ZW$177m (38%).
The group is optimistic of a rebound in tourism and the on-going vaccination drive has led to a gradual re-opening of world travel as well as domestic tourism.
The resumption of international flights into destination Zimbabwe and the expected opening up of the economy in the remaining months of the year will see a significant growth in business volumes.
This will coincide with the onset of the traditional high-season period.
Most government conferences, NGO activities and domestic leisure travel is expected to take place in the last half of the year. Usually, the second half of the year contributes 60% of the business.
The group is optimistic of a significant rebound in the second half of the year and anticipate a revenue contribution of 80% in revenues.
