Brainworks strategis focus on debt reduction yields positive results

Posted On Tuesday, 30 April 2019 17:27 Published by
Rate this item
(0 votes)

Brainworks – a Mauritian-based JSE-listed holding company with a Zimbabwean hotel and real estate investment portfolio –– released annual results for the year ended 31 December 2018, reporting revenue up by 35% to US$79.3 million from US$58.6 million in the prior year.

 BRETT-CHILD-

Notable contributions came from the hospitality segment accounting for 86% of the group’s total revenue.

Domestic and foreign revenue increased 26% and 32%, respectively. Improved hotel occupancy (59% vs 52% in 2017) resulted in the average daily rate improving to US$109 from US$93, and revenue per available room up by 33% to US$64 from US$48. Hospitality and real estate segments remain the group’s major drivers of revenue.

CEO Brett Childs says: “Despite the economic headwinds and currency reforms in Zimbabwe, the group has done well for the year under review. Our strategy of focusing on hospitality and real estate, which made a material contribution following the completion of our maiden property development in Harare, is proving successful as evidenced by our results and the significant reduction in debt.”

Brainworks reduced its debts by 55% from US$38.3 million to US$17.1 million. This was achieved through capital raising initiatives during the year, as well as exiting our financial services businesses, namely, GetBucks Microfinance Bank and GetSure Life Assurance. The group recorded an overall positive impact of US$7 million from the exit of the financial services sector investments during the year.

In spite of increased volumes and inflationary pressures on operating costs, the group managed to curtail an increase in operating expense to only 19%, resulting in operating expenses of US$47.9 million. At the holding company level, operating expenses were reduced to US$4.7 million, down from US$5.7 million.

The Zimbabwean economy is showing signs of growth but is still constrained by a number of challenges – the most notable being the shortage of foreign currency. Authorities remain confident that newly implemented measures will stabilize inflation, exchange rates and foreign currency supply. Inflation recorded a significant increase in October 2018 closing the year under review at 42.1% compared to 3.46% in December 2017.

“We will continue our strategy of reducing costs at the centre, and focusing on our core businesses,” says Childs.

Last modified on Tuesday, 30 April 2019 17:36

Most Popular

Three stocks to boost your portfolio in 2020

Jan 22, 2020
Dr Adrian Saville CEO Cannon Asset Managers
After enduring a trying decade under the mismanagement and malfeasance of Jacob Zuma,…

Africrest Properties completes mixed-use development, Stanley Studios in Johannesburg

Jan 21, 2020
39 Stanley Avenue
What could be better than living in an extremely well-priced apartment or working in…

New hotspots driving cost hikes in key data centre markets - thriving market in South Africa

Jan 21, 2020
Dan Ayley Turner and Townsend
Major global data centre markets are seeing soaring construction costs as development in…

Equites Property Fund Limited to develop a R1.3 bn warehouse for Pepkor

Jan 21, 2020
Andrea Taverna Turisan  CEO Equites Property Fund
Equites Property Fund Limited (Equites) today announced an agreement with leading…

2020 Commercial Property Themes –Electricity supply and cost will be a key wildcard for the Commercial Property Sector this year

Jan 23, 2020
John LoosFNB
Will electricity supply reliability and cost increases become a key issue again in 2020?

Please publish modules in offcanvas position.