Upgrades planned for Sun City and surrounding areas
The North West government said that the resort is regarded as a key tourism asset for the country, and that the parties were looking at ways to expand the resort and improve the different infrastructure that would unlock the maximum tourism boom in the resort.
As part of the meetings, Sun City’s management presented future plans to expand the establishment which included a new hotel to attract more visitors for sports, conferencing, arts and culture activities or leisure amongst others.
Sun International chief executive officer Anthony Leeming said that the resort is a massive asset that requires a massive investment in infrastructure through collaborations across different industries, to secure the ability to stimulate tourism activities and create much-needed jobs in the sector.
“Getting Sun City to work better will help the province. It is critical that we find a balance between what the resort and what the provincial government is doing.
“We have got an amazing beauty in this country that we can really take to the next level and attract foreigners in large numbers and Sun City is the key in achieving that,” Leeming said.
Sun International’s group chief operating officer Graham Woods said that support from the government was important for the growth and sustainability of Sun City.
“We need the support in the road infrastructure especially on the maintenance and upgrade of roads around the resort, improvement of roads and buildings in the Pilanesburg National Park, renovations of the Pilanesburg Airport infrastructure, support in the sports campus marketing and bidding of massive events” said Woods, who also requested government to assist in fighting illegal gambling which is affecting their business.
Must be successful
North West premier Job Mokgoro acknowledged the provincial government’s shortcomings and said that the province must ensure Sun City’s success as a business case for the province.
“This is a very important initiative. Here we’re talking about the economy of a region. The Office of the Premier will take care of ensuring that all key departments are on board.
“This is the business case that we would also broaden to look at other economic sectors in the region because the inter-linkages are very important,” he said.
All parties agreed to formulate an action plan with deliverables to kick-start the partnership.
A follow-up meeting to monitor progress will be convened in due course to achieve the envisaged vision of bringing the tourism boom in the resort to the benefit of the surrounding areas and the province.
Hard-hit by Covid
In March, Sun International reported that the Covid-19 pandemic had a significant impact on its business for the year ended December 2020, with group adjusted headline earnings down from R763 million to a loss of R1.1 billion, and an adjusted headline loss of 633 cents per share.
Income from continuing operations declined by 49% from R11.8 billion to R6.1 billion and continuing adjusted EBITDA reduced by 72% from R3.2 billion to R897 million, it said.
For the first six months of the year in South Africa, income declined by 55% to R2.5 billion compared to the prior corresponding period, with adjusted EBITDA down by 95% to R80 million.
Even at latest reporting, the South African hotel industry continued to be significantly impacted by the effects of the Covid-19 pandemic and the associated lockdown.
While the hotel industry has re-opened for domestic leisure and business travel, trading levels were severely muted.
Sun City re-opened on 2 September 2020, while the easing of lockdown restrictions to level 1 at the end of January increased domestic leisure travel demand into resort destinations. “The Sun Vacation Club at Sun City performed well under these trading conditions achieving occupancies of 79%,” the group said.
Midweek demand from the corporate transient and Meetings, Incentives, Conventions and Exhibitions (MICE) segments remains weak, however.
Over the period, Sun City swung from making revenue R1.4 billion in 2019 to just R699 million in 2020 (a decline of 56%), while EBITDA dropped from earnings of R146 million, to a loss of R142 million in 2020.
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