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Business Reporter
LISTED hospitality firm Rainbow Tourism Group Limited (RTG) recorded a significant decline in occupancies during the nine months to September 30, 2020 as the Covid-19 pandemic took its toll.

Across the globe, the travel and tourism sector is arguably the worst affected by the highly infectious disease.

A refurbishment project at the group’s linchpin Rainbow Towers Hotel and Conference Centre also had a negative impact on overall hotel business.

In its trading update for the third quarter, management reported that cumulative occupancy declined to 22 percent from 47 percent recorded in the prior year.

“The main driver of the decline was the global Covid-19 lockdown restrictions. The temporary closure of the Rainbow Towers Hotel and Conference Centre (which is 40 percent of the business) for refurbishment during the first three months of the year, also contributed to the decline in occupancy,” said the group.

The Rainbow Towers Hotel and Conference Centre is undergoing a US$3 million-dollar facelift of 183 of its guest rooms and suites. Notwithstanding the impact of the pandemic and refurbishment, the group’s numbers for the period under review remained solid. During the nine months to September 2020, RTG’s inflation adjusted revenues closed at $586 million.

“EBITDA (earnings before interest, taxes, depreciation and amortisation) margin for the period under review closed at 35 percent margin, which is three percentage points above prior year.

“This resulted in a positive cash position, which was driven by the cost containment measures. Despite the challenging operating environment, we are pleased to report that the group managed to close the nine months in a profit position,” reported management.

During the challenging phase, the group refocused on its digital business, particularly the Gateway Stream Application. Gateway Stream was created in February 2018 as an integrated, versatile, innovative mobile and web-based application. At the time of its launch, it consisted of four sub-apps: Hotels, Homes and boats, Restaurants and online room auctions; all of which enabled users to book and pay for the four services.

By the close of 2018, and with further development, Gateway Stream consisted of nine sub-apps with the addition of holiday packages, Book-a-ride (taxi-hailing service) online and events and venues. The grocery delivery service, which was introduced this year, helped the group hedge against Covid-19 related losses in its core business.

During the quarter, the Gateway Stream was named the overall winner in the innovation and technology category by the Quoted Companies Survey 2020. Going forward the group expects to leverage on emerging opportunities on the local and regional travel markets.