Rainbow Towers gears for refurbishment

Centre will commence next month after securing US$7,5 million for the project.
RTG believes the refurbishment programmes on its facilities are “critical for the long-term viability and enhancement of market competitiveness both locally and internationally”.
RTG group chairman Mr Patterson Timba said the refurbishment of their flagship hotel – Rainbow Towers and Conference Centre – will commence this April.
“Preparatory work for the refurbishment of the Rainbow Towers Hotel and Conference Centre is at an advanced stage and work on site should commence in April 2011.
“The Group has already secured a US$7,5 million long-term facility to finance the project,” he said.
In respect of other projects, the chairman said the construction of the Beitbridge Hotel, which began in the second half of last year, is expected to be completed in the last quarter of this year, with operations set to commence in the first half of next year.
The refurbishment and upgrade of the A’Zambezi River Lodge into a four-star facility is nearing completion and the hotel is expected to be up and running by May.
The group’s turnover was US$23,5 million during the period under review, a growth of 34 percent from the same period last year.
This was attributable to an improvement in average room rate and revenue per available room to US$68 and US$27 respectively against figures of US$55 and US$21 in the comparative period.
The regional operations contributed eight percent to the group’s turnover and achieved a profit before tax of US$330 000 after Hotel Mozambique which started to operate under the Rainbow brand in July last year weighed in with profit before tax of US$130 000.
However, operating expenses amounting to US$21 980 080 left the group in a net loss position of US$1,2 million.
The group attributed the loss to the closure of some of its properties for refurbishment, liquidity challenges in the economy and high cost structures, driven largely by employment and retrenchment costs.
The group undertook a staff retrenchment exercise in September last year at a cost of US$704 000.
The report shows that the group’s occupancies remained static at 40 percent during the year.
A depressed occupancy rate was also recorded for the group’s flagship, the Rainbow Towers Hotel and Conference Centre, which declined to 40 percent from 43 percent in the previous year.
The hotel and resort group has indicated its intention to raise US$5 million for re-capitalisation as it seeks a return to profitability; however, it is yet to specify the capital raising route. Going forward, RTG is planning to lower costs and improve its bottom line.