Meikles reverses Victoria Falls Hotel stake sale
Livingstone Marufu
Meikles Limited has made a U-turn on plans to sell its stake in the Victoria Falls Hotel, citing what it describes as a “highly encouraging” outlook for Zimbabwe’s tourism sector, Business Times can report.
Meikles jointly operates the iconic Victoria Falls Hotel with African Sun Limited. The group had been considering disposing of its interest in the property to Albwardy Investments, the Dubai-based firm that acquired the Meikles Hotel five years ago.
The proposed transaction last year became the centre of a boardroom dispute at Meikles, with some former directors accusing then chairman John Moxon of pushing through the deal without adequate consultation with African Sun.
However, the group has since reversed its position, opting to retain the asset amid improving prospects for the tourism industry.
In a statement accompanying the group’s half-year results for the period ended August 31, 2025, chairman Fayaz King said the earlier decision to divest had been abandoned in light of the sector’s positive trajectory.
“The Board has revised its earlier decision to divest the group’s interest in hospitality operations. Consequently, these operations have been reclassified from discontinued operations and assets held for sale to continuing operations. The outlook for tourism remains highly encouraging. Notably, Forbes has named Zimbabwe the top global destination to visit in 2025. This prestigious international recognition is expected to elevate the country’s tourism profile and drive growth in international arrivals over the coming months,” King said.
Meikles expects the decision to retain the stake to strengthen its hospitality division and support a turnaround for the diversified group, which has been grappling with mounting operational challenges.
The anticipated recovery comes as the group’s financial pressures intensified, with its loss widening sharply to ZWG165.7m for the six months ended August 31, 2025, from ZWG1.5m in the comparative period, largely due to a difficult operating environment.
The supermarket segment remained the principal contributor to revenue, accounting for 98% of total turnover, but suffered a significant setback from prolonged power outages and elevated operating costs across the retail sector.
King said efforts by authorities to contain inflation had also weighed heavily on consumer demand.
“The group reported an after-tax loss of ZWG165.7m, compared to a loss of ZWG1.5m in the prior year. This result reflects the challenging macroeconomic conditions impacting the retail sector. The operating environment remained challenging for formal retail businesses during the period under review,” he said.
He noted that while the repeal of Statutory Instrument (SI) 81A through SI 34 of 2025 had improved the ability of formal retailers to compete on price with informal operators, trading conditions remained constrained.
“The authorities’ tight monetary policy contributed to price stability but simultaneously suppressed consumer demand. The cost of doing business continues to be prohibitively high for formal enterprises. Operational difficulties were further compounded by intermittent power supply and persistently elevated operating costs, which intensified the pressures faced throughout the period,” King said.
Despite the entrenched economic challenges, the group said it welcomed the government’s recent pronouncements and strategic focus on easing the burden on formal businesses.
Group revenue rose to ZWG6bn in inflation-adjusted terms, up from ZWG5.4bn in the prior year. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 74% in inflation-adjusted terms to ZWG70.7m.
Interest expense amounted to ZWG33.4m, largely attributable to IFRS 16 lease-related interest of ZWG27.2m, with the balance of ZWG6.2m arising from bank loan interest. The group also incurred an exchange loss of ZWG65.1m following the remeasurement of US dollar-denominated trade payables within the supermarket segment.
King said that, notwithstanding these pressures, the group’s solvency and liquidity positions remained sound, providing a stable foundation for operations across all business units.
Supermarkets are now positioning for the festive season, traditionally a peak period for revenue generation.
“Trading results for September and October 2025 showed an overall improvement compared to the preceding months. From a working capital perspective, the segment is well-positioned to fully stock up in anticipation of elevated demand,” he said.
The board resolved not to declare an interim dividend, opting instead to preserve cash and maintain a strong liquidity position in light of the challenging operating environment.
Looking ahead, Meikles said it remains cautiously optimistic about performance across all segments for the remainder of the financial year and beyond.
