Page 79 - Gondwana Collection Namibia Value Creation Report 2021

PROFIT: SUSTAINING OUR IMPACT

Prudent financial management Growth in occupied bed nights per year Gross profit (N$’000) Total comprehensive (loss)/income (N$’000)

We continued with our financial savings initiatives with care not to damage the 600 000 80 350 000 60 000
40 000
70
500 000
quality of our product. 400 000 60 250 000 20 000 0
300 000 50 -20 000
40 150 000
While we endured significant budget cuts, our core remains intact. We never abandoned our people, properties, communities or conservation efforts. While we cut expenses to the bone, we did not 200 000 -40 000
compromise or lose our moral compass on the things that matter. Today, we better understand why we do something more than the how. 30 -60 000
100 000 20 50 000 -80 000
We continued to offer a high-quality customer experience with fewer employees. We impressed customers with the excellent service and uniqueness of our offering. We realised that personal 0 10 -100 000
interactions and experiences triumph over the luxuriousness of commodities. An outdoor shower open to the African sky offers more value than a marble bath.
2015 2016 2017 2018 2019 2020 2021 2022 2015 2016 2017 2018 2019 2020 2021 2022 2015 2016 2017 2018 2019 2020 2021 2022
We unlocked further operational efficiencies with cross-skilling throughout the company. These efficiencies will result in real profit in the coming years. We invested in technologies to amplify these efficiencies. Budget Budget Budget
We have consolidated and bolstered our systems. These systems help us to predict and analyse trends. They also mitigate the risk of fraud, while picking up irregularities and delays in processing. Capacity Total occupied bed nights Occupancy
Gross profit increased by 9% while gross profit margin increased The company’s net profitability continues to reflect our Covid-19
by 2%. operating conditions.
Due to Covid-19 travel restrictions and apprehension about
Financial and saving measures ○ Restructured overdraft facility while maintaining travel, occupancy rates remained low at 16%. The capacity
flexibility in model: overdraft into a long-term facility
We applied strict cost management to protect our cash flow increased due to the opening of Etosha King Nehale in
and financial stability. to save on interest expenses and capital outflow June 2020. EBITDA (N$’000) Earnings per share (cents per share)
Utilised available help 120 000
Regular forecasting 90
○ Applied for the moratorium on capital loan repayments 76 000 60
○ Weekly scenario and cash flow planning in line with 30
changes in our environment with the Development Bank of Namibia as per their Total consolidated revenue (N$’000)
economic stimulus and relief package 32 000 0
Controlled our costs through prudence and planning ○ Utilised grants from the Conservation Relief, Recovery 500 000 -12 000 -30
○ Carried out immediate and aggressive cost controls and and Resilience Facility launched by the Community 400 000 -60
cost-saving measures at all operational entities Conservation Fund of Namibia for Conservancies and joint -56 000 -90
venture lodge employee salaries 300 000 -120
○ Suspended all capital improvements and refurbishments Progress -100 000 -150
○ Applied for the once-off National Employment and
○ Suspended stock procurement and moved and optimised stock with our 200 000 2015 2016 2017 2018 2019 2020 2021 2022 2015 2016 2017 2018 2019 2020 2021 2022
(bar, food, curio, maintenance stocks) between the lodges Salary Protection Scheme through the Ministry of Budget Budget
Finance and Social Security Commission business 100 000
○ Suspended all Board and Board committee fees until Earnings before interest, taxation, depreciation, and The total number of issued shares remained at 66 357. Earnings
further notice ○ Applied for the once-off Vocational Education and interruption claim 0 amortisation (EBITDA) is a measure of the company’s overall per share reflect our poor financial performance due to the
Training levy relief programme
Employee savings ○ Engaged with the Receiver of Revenue When we entered the pandemic, we were 2015 2016 2017 2018 2019 2020 2021 Budget financial performance. Our EBITDA increased by 53% from 2020 pandemic.
2022
confident that our business interruption insurance would protect us.
○ Executive directors took a 40% salary cut while all other regarding the accelerated repayment of We soon discovered that our insurer was not committed to honouring
employees took a 25% salary cut from September 2020 to overdue and undisputed VAT refunds per the our contractual agreement. Our insurer has deliberately delayed the Operating profit (EBIT) (N$’000)
June 2021 Economic Stimulus and Relief Package settlement of our N$350 million claim. Consolidated revenue showed a 7% increase against 2020 from
○ Reduced other employee costs by more than 30% due ○ Gondwana was certified by OSH-Med N$153 million to N$164 million and an increase in yield per guest 100 000
of 2% as local and regional travel dominated.
to schedule management, overtime restrictions, leave International as a Covid protocol-compliant We have enlisted the help of the specialist firm, Insurance Claims Africa, 60 000
schedules and skeleton staff where possible tourism establishment with the Ministry of which spearheaded the fight against South African insurers that similarly
refused to pay Covid-19 business interruption claims until compelled to
○ Suspended company pension fund contributions from May Health and Social Services as part of the do so by the courts. There is extensive legal precedent ruling favouring 20 000
0
Tourism Revival Initiative
2020 to November 2021 (12.5%) to reduce total employee claimants who bought business interruption insurance that includes cover
costs without initially affecting employees’ take-home pay Engaged with customers for infectious diseases. -40 000
○ Applied an immediate embargo on all new positions and ○ Encouraged postponements rather than -80 000
replacements. cancellations to conserve deposits The legal process has been protracted so far. Gondwana filed a -120 000
court application in December 2020. In September 2021, our
Managed our financial risk and flexibility ○ Extended the benefits for larger discounts for insurer filed back. Gondwana replied to our insurer’s court 2015 2016 2017 2018 2019 2020 2021 2022
meals, activities and payment terms for Gondwana application in December 2021. We envisage the case Budget
○ Managed bad debt by waiving cancellation fees for paid- Card holders
up term debtors and direct customers in distress to be heard in court during 2022. We are Earnings before interest and taxation (EBIT) showed a 37%
committed to staying the course until
this matter is resolved. increase on 2020.

74 VALUE CREATION REPORT 2021 GONDWANA COLLECTION NAMIBIA 75