THE COVID-19 CRISIS AND ITS IMPACT ON THE TRAVEL AND TOURISM INDUSTRY

On 11 March 2020, the World Health Organization (‘WHO’) declared COVID-19 a pandemic. Shortly thereafter, on 15 March 2020, President Ramaphosa declared a national state of disaster, which included numerous, very necessary interventions in order to contain the spread of
COVID-19 in South Africa. As a group, we are fully supportive of the President’s actions and understand that this is a serious public health and economic crisis that requires a decisive and coordinated response from all spheres of society.

With the exception of airlines, the hospitality industry was the first to feel the devastating impact of COVID-19. With the acceleration in travel bans imposed by many countries, including South Africa and the other markets in which we operate, the group saw international demand retracting as early as the last week of February 2020. The initial international travel regulations imposed by the President were exacerbated by the ban on interprovincial travel announced on 23 March 2020 as part of the nationwide lockdown. This resulted in a material reduction in revenues for the month of March, which is normally a peak activity month for the group. As a result of the situation, our entire portfolio in South Africa, Africa and the Seychelles was deactivated, with the exception of those hotels designated as quarantine facilities or as accommodation for essential service providers and persons awaiting repatriation.

Since the implementation of the national lockdown on 27 March 2020, we have been in close communication with our lenders, employees, trading partners, suppliers, tenants and landlords in order to arrive at mutually sustainable operating solutions in these extraordinarily difficult times. The various measures put in place in response to the pandemic are discussed further in our leadership reports.

Our strategic objective of sustainability has never been more relevant. We appreciate the support of all our stakeholders as we navigate this turbulent time in the travel and tourism industry. We need to draw on the legacy of our 50-year heritage, which is undoubtedly characterised by our warm hospitality and people-centric culture. We see this time as an opportunity to optimise our business processes and operational structures so that we can emerge as a financially flexible and flat organisation that supervises our people less while promoting their increased involvement in the decision-making process.

Our 2020 integrated annual report as a whole reflects our performance for the 2020 financial year. While 2020 was partially impacted by COVID-19, we are very aware that the 2021 financial year will be the most difficult year in our history. Given our knowledge at this stage, we have indicated at appropriate points in this report, that COVID-19 will be a significant consideration in our approach, planning, stress testing, and the like. However, we have not reflected a revised outlook throughout the report as the effects of the pandemic will be dynamic and remain uncertain at the date of approving this report.

We welcome the recent announcements by President Ramaphosa of further relaxations to regulations restricting travel, the provision of hotel accommodation, restaurants and conferencing. The safety of our employees and guests remains paramount. In anticipation of the reactivation, the group has a number of health protocols and control measures in place, including employee training, personal protective equipment and hygiene resources, social distancing and screening of guests as well as increased sanitation and hygiene processes.

We look forward to welcoming back our guests with the warm South African hospitality we are known for.