Sun International Group’s income declined by 49% from R11,8bn to R6,1bn and EBITDA (earnings before income tax, depreciation and amortization) slid by 72% from R3,2bn to R897m in the year ending December 31, 2020.
But the Group believes it is on a solid footing for a slow recovery. “Our gaming side of the business has proven its resilience and we anticipate that we will continue to see improvement in revenues and adjusted EBITDA as the restrictions are eased and ultimately lifted,” said the notes in its annual report.
The total group adjusted headline earnings declined from R763m in 2019, to a loss of R1,1bn.
Income from the South African operations declined by 48% from the prior year to R6bn and adjusted EBITDA was down by 70% to R984m.
Sun International is actively considering expressions of interest on both its Africa operations outside South Africa, and is pursuing the disposal of its interests in the properties. These are the Federal Palace of Nigeria in Lagos, whichhas resumed “muted” trading, and its eSwatini operations. The Group says it is unclear when the eSwatini properties will reopen.
The group has exited its Chilean Sun Dreams investments.
In 2020, lockdowns requiring the closures of many of its properties, and inbound, local tourism disruption both in leisure and corporate travel had a devastating effect, both on the Group and the entire hotel industry.
The Group saidCOVID-19would continue to have a significant impact on the economy, which will take some time to recover and would impact its trading results.
“The hotel and resort side, while benefiting from growth in local leisure, will continue to be impacted by the lack of demand in the business, conference, meetings, and international market segments. The capital raise as a result of the rights offer and the proceeds from the disposal of Sun Dreams, has improved our liquidity position from significantly strengthening the group’s balance sheet. These actions and the various operational initiatives which we have undertaken and implemented in the past twelve months, have ensured that the group remains well placed to deal with the current and future COVID-19 challenges and the group is strongly positioned to recover and to grow in the future.”
