Southern Sun half-year HEPS up 35%

Hotel group Southern Sun has reported a 31 per cent rise in adjusted headline earnings for the first half of the year, with occupancy levels at around 58.9 per cent. CEO Marcel Von Aulock attributes this growth to the recovery efforts made during the pandemic and the positive outlook for the future. The group's results reflect a strategic approach to decision-making and planning amidst challenging market conditions. Von Aulock highlights key areas of performance, including provincial dynamics and the impact of international events on their properties. The Western Cape region, driven by local and international visitors and events at the Convention Centre, has shown solid growth. On the other hand, KwaZulu-Natal, particularly Durban, faces challenges in attracting business due to negative publicity following recent unrest. However, a summer sale initiative has shown promise with a 20 percent increase in bookings for December, indicating a potential turnaround. In Gauteng, Sandton has been a strong market, benefiting from being a prominent business hub, while Rosebank's performance has improved but still lags behind. Despite challenges, the airport node has shown strength, and conferencing businesses like Birchwood have seen positive results. The CEO acknowledges the tough market conditions in Rosebank but remains optimistic about the region's long-term potential. The situation in Mozambique presents a significant concern for Southern Sun, with political unrest impacting occupancy levels and revenue. The CEO estimates a loss of about 10 million rand per month due to the current situation, emphasizing the need for stability and peace in the country. Despite the challenges, Von Aulock sees the potential for growth in Mozambique and hopes for a swift resolution to the crisis. Von Aulock also discusses the government's efforts to simplify visa processes, which could benefit the tourism industry. He highlights the importance of regulatory changes to attract tourists from key markets like India and China. The CEO expresses optimism about the government's initiatives and the potential for increased tourism revenue. Looking ahead, Southern Sun's focus for the next six months is on internal operations, including ongoing renovations and improvements to guest experience. The company aims to increase occupancy rates to over 61% for the year and continue delivering quality service to customers. With a strategic approach and steady growth trajectory, Southern Sun anticipates positive results by year-end.