We have extracted below the Chairman’s Statement from the 2018 half year interim report of Rainbow Tours Group Limited (RTG.zw), listed on the Zimbabwe Stock Exchange:
On behalf of the Board of Directors of Rainbow Tourism Group Limited (RTG), I am pleased to present the financial results for the half year ended 30 June 2018. The Company’s performance continued to improve on all performance indices. The improvement is attributed to a successful low season strategy, growth in conferencing business as well as revenue from foreign currency generating channels including e-commerce platforms.
2. OPERATING ENVIRONMENT
Despite the challenges endured during the previous year within our local operating environment which include shortages in foreign currency and cash as well as the resultant distortions in prices, we are optimistic of a bright future. The acceptance by the international community of the new government with its efforts of re-engaging the international community and our optimism of business-friendly government policies all contribute to creating an enabling environment for our business. The level of engagement and accountability being initiated by government as demonstrated by the commencement of weekly post-cabinet updates to the nation are a welcome development.
3. PERFORMANCE REVIEW
In the first half of 2018, the Company recorded a 18% growth in revenue to $13.7 million from $11.6 million recorded in prior year. All RTG hotels registered growth in revenue during the first half of 2018 compared to same period in 2017. The two Harare hotels registered a 42% increase in revenue to $6.4 million from $4.5 million in 2017. This is evidence of the opening up of the economy to business travel. It therefore gives us optimism for sustained recovery for our city properties.
Foreign revenues continued on an upward trajectory, registering a 24% growth to $4.7 million from $3.8 million, constituting a contribution of 33% of total revenue. This growth in foreign revenue contribution is encouraging as we continue to grow our share of the $1.2 trillion global tourism industry. The company’s focus on digital commerce has driven revenue from e-commerce platforms which have grown by 49%. Again, the company is well positioned to benefit from the global migration towards internet-based business.
Gross margins improved to 67% from 65% recorded in 2017. This was notwithstanding price distortions as driven primarily by foreign currency shortages. The Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) margin for the period closed at 16% ($2.2 million)