Meikles fights Covid on two fronts

MEIKLES Limited, the listed conglomerate, says it is worried that the second wave of the Covid-19 scourge currently tearing through Zimbabwe and South Africa will affect its tourism operations.

After disposing of its flagship Meikles Hotel in 2019, the company now owns the Victoria Falls Hotel in Victoria Falls.

It is a joint venture with African Sun Limited, the country’s largest leisure chain.

The company also holds a significant shareholding in the Cape Grace Hotel in Cape Town, South Africa.

In a trading update for the third quarter and nine months ended December 31, 2020 this week, Meikles Limited secretary Tabani Mpofu confirmed market-wide fears about the continued lockdowns in both southern African countries, which draw billions from the travel industry.

“The start of the fourth quarter coincided with the second wave of Covid-19 affecting the country, South Africa and major international source markets for the tourism segment,” Mpofu said.

“In response, the government scaled up restrictions on movement of people to curtail the spread of the virus .Whilst the group’s main segments are classified as essential service and continue to operate, revenue is likely to be affected by reducing volumes to the end of the financial year and beyond,” said the group,” he said.

Group revenues tumbled 7% during the last quarter ended December 31 notwithstanding the easing of Covid -19 lockdown.

“In inflation adjusted terms, group revenue retreated by 7% and 8% for the quarter and nine months to date, respectively,” Mpofu said.

“Bulk tea production was 17% behind the year ended 30 September 2020. In volume terms, bulk tea export sales were behind last year by 8% and 10% for the quarter and year to date, respectively. Average bulk tea exports price for the quarter of US$1,39 per kg was on par with the average price achieved in the same period last year but was 6% behind last year for the year to date. Packed tea and coffee sales volumes grew by 24% and 18 % for the quarter and year to date respectively,” Mpofu said.