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City Lodge Steaming Ahead

JSE-listed City Lodge Hotels group has achieved strong financial results in the 12 months to June 30, reports Kate Nathan of Tragvel News Now. Headline earnings have risen by 18% to R144,6m and fully diluted headline earnings per share also increased by 18% to 337,9 cents from 287,4 cents previously.

A final dividend of 121 cents was declared, taking the annual distribution to shareholders to 238 cents, a 17% hike on the 203 cents distributed a year earlier. An improvement in operating profit of 17% brought earnings to R211,5m. Average occupancies improved from 77% during the previous year, to 79%, the highest annual average for a decade, says the group.

One new hotel came on stream, in March - the 120-room Town Lodge George, the 38th hotel in the group. The higher occupancies and the new capacity in George were contributors to revenues rising by 13% to R442,1m. Nett profit rose by 17% to R143,9m, compared with R122,6m in the previous year (restated in line with IFRS requirements).

Founder and non-executive chairman, Hans Enderle, said while earnings were coming off a high base, the addition of new capacity and the continuation of favourable trading conditions should result in satisfactory earnings growth in the year ahead.

He said Town Lodge George had experienced a slow start, but its occupancies were expected to improve as it established a niche for itself.

“Construction is well under way on the 106-room Town Lodge Roodepoort, scheduled to open in the last quarter of this calendar year. Construction has also begun on the 90-room Road Lodge East London with the first rooms expected to open prior to Christmas,” said Enderle.

Plans are in place to expand Road Lodge Germiston by 24 rooms and a site has been acquired in Richards Bay on which a 90-room Road Lodge will be built.

There are already two highly successful City Lodge hotels in Durban - one in the centre of town and one at Umhlanga Ridge, at the entrance to the highly acclaimed Gateway Shopping Centre.

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