Africa focused safari services provider, Wilderness Holdings saw a major boost in their pre-tax profits for the full year ended on 28 February 2013, thanks to a decline in the group’s tax rate.
Group Chief Executive Derek de la Harpe and the Board chairman Parks Tafa said in a statement that the Group’s effective tax rate declined from 49 percent in the prior year to 15 percent in the current financial year under review. The two executives said the effective tax rate in the past year was higher than would be expected owing to the non-recognition of deferred tax assets in that year. However, with a major decline in the tax rate, the Botswana Stock Exchange (BSE) listed company saw its profits before tax accelerating by 103 percent to record P33 million, more than double what was achieved in 2012 FY results.
However, profits after tax, which stood at P8 million on the prior corresponding period increased by 238 percent to settle at P28 million. Despite the fact that Wilderness’ total bed night sales declined by 4 percent to 182 764, on the back of permanent closure of non-performing camps and the temporary closures of others for maintenance, the company’s revenue also shot up by 13 percent. “For the 2012 calendar year we increased our rates on average by between 4 percent and 10 percent.
It is gratifying to note that our US dollar turnover increased by 6.4 percent and that source currency turnover has increased in all other currencies except the Namibian dollar,” De la Harpe said in the statement. Together with Tafa, de la Harpe said the positive impact of the Rand weakening by an average of 13 percent against the US dollar over the year was partially offset by a 2 percent unfavourable movement in the Rand-Pula cross rate. “The net result is that turnover has increased by 13% to P1.2 billion.
Currently the group which has been in existence for 30 years owns and operates 59 luxury safari camps, with a total of 1 028 beds, in eight Southern African countries namely Botswana, Namibia, Zimbabwe, Zambia, South Africa, Seychelles, Republic of Congo and Malawi. Meanwhile Wilderness executives said they expect to see a slow but steady strengthening of their major source market the United States, with a muted recovery from source markets in Europe against a backdrop of on-going uncertainty in the world economy.
They said the company has therefore embarked upon a strategic plan designed to address changes in the market, improve guest service, and increase efficiencies and to re-size certain businesses for lower levels of demand. The Board has authorised P54 million in capital expenditure to maintain and develop new camps and other assets and thus expand their earnings’ base. The Board envisages that existing cash balances will fund this and unutilised borrowing facilities.