Wilderness Holdings said it is readying itself for possible market consolidation arising from the worst ever global economic downturn that hit hard the travel market.
Andy Payne, the Chief Executive Officer of the Botswana Stock Exchange (BSE) quoted company told an annual general meeting this week that the current trading environment is challenging.
“Wilderness is presently well positioned to take advantage of these opportunities that are likely to present themselves in the short to medium term,” the AGM was told.
Wilderness, unlike other tourism outfits, has untapped war chest, including $US 11 million un-drawn facilities from Industrial Development Corporation (IDC) of South Africa and its cash reserves.
Payne highlighted that the current business environment remains challenging due to the tough economic climate in the regions of the company’s source markets.
Key source of revenue for the company include America and Europe that are still finding it difficult to come out of the recession.
Equally, it was revealed that the continuing strength of the Rand and Pula against the US Dollar, relative to the rate in the prior year has also impacted negatively on the translation of foreign earnings.
In addition, the World Cup proved to be a challenging period ‘as our traditional customers chose to avoid travel in the months of the tournament’.
Another tourism company, Mashatu, said last month sales were down during the 2010 World Cup, although many expected that tourism in SADC will gain from the month long event.
Despite the challenges, Payne said while yield was still under pressure, a condition likely to remain in the short term, bed nights sold by the company have increased relative to prior year.
In this current environment, the company plans to continue with its strategic objectives, as originally identified and disclosed during the Initial Public Offering (IPO) process.
Some of the initiatives the company intends to go ahead with include investing in people, investing in the Wilderness brand and connecting the brand with the customer, investing in product relevance. It also plans to invest in scale opportunities and strengthening the company’s balance sheet and accumulating its cash reserves.
The 26-year-old business is invested in 53 destinations and manages and markets a further 17 in seven Southern African countries. It also operates specialist travel businesses in six countries as well as a fleet of 49 aircraft.
It employs more than 2,700 people most of them in Botswana operations, and most of whom coming from remote rural communities.
Its other operations are in Namibia, Malawi, and SeychellesÔÇöwhere it owns an island, South Africa, Zambia and Zimbabwe.
The company’s AGM was held on Tuesday 31 August 2010.
