Jocelyn Newmarch

JSE-listed company IFA Hotels & Resorts, which focuses on the leisure development market, yesterday posted a further plunge in its audited annual results, but said it was preparing for a revenue-positive 2009 financial year.

The group posted an operating loss of R11m for the year to June, and a loss of R5,6m against a R20m profit for the previous year. It declared a loss per share of 2,55c, compared with earnings of 9,31c before.

No dividend was declared.

IFA owns the Fairmont Zimbali Lodge, the Legends development in the Waterberg, hotels in Namibia, the Seychelles and Zanzibar, and it also has a stake in the Boschendal development near Franschhoek. The group focuses on luxury residential and leisure developments.

Wessel Witthuhn, president of IFA Africa and Indian Ocean, said the group had spent the year taking on more staff and preparing for an expansion into the rest of Africa “in a much more aggressive way than we were doing”.

He said the group aimed to record a positive revenue stream for next year as a strong management team and a “huge platform” were now in place.

Witthuhn said the group had a $700m development in the Seychelles, and had started planning the launch of the Zimbali Lakes project, for which it was doing sales and marketing.

Of the four hotels in Namibia, he said construction at one site had commenced while construction of the second was due to begin next month.

IFA had announced a 78% profit drop to R2,2m for the six months to December, evidently as a result of group subsidiaries incurring losses in anticipation of development rights.

Revenue dropped slightly to R118,8m from R120,3m for the previous year. While investment income surged to R35m from R7m previously this was neutralised by finance costs, which increased to R36,8m from R9,7m previously.

IFA is 85% owned by parent company IFA Hotels & Resorts Kuwait, which is headquartered in Dubai. The group said a number of projects it was to launch shortly “will help bring the group to profitability”.

Source: Business Day