The five key pillars of our sustainability include:

Sharing value with our beneficiaries is a critical part of maintaining our social licence to operate

An appropriate capital structure is important to ensure the business survives through the economic cycle

To remain relevant a variety of quality experiences must be provided at appropriate price points

As a multinational business, the group is subject to a wide range of legislation and compliance is critical to our reputation and sustained profitability

Qualified, trained, talented and empowered people are required to deliver the Tsogo Sun Hotels’ experience

Level 1 B-BBEE contributor Black ownership 75% R3.1 billion value added to black economic empowered businesses and government 162 beneficiaries supported through Tsogo Sun Entrepreneurs programme

Leverage ratio Tsogo Sun Hotels 1.3 times Hospitality 3.2 times Unutilised facilities + cash of R1.7 billion 2.9 years weighted average expiry of debt facilities 71% of Hospitality’s net debt is hedged

18 834 hotel rooms across all market segments 88% hotel guest satisfaction

No significant regulation breaches

6 596 direct employees 91% of employees are African, Coloured and Indian and 56% are women

A business has to stay in business to be able to take advantage of the commercial opportunities that are presented to it.

SUSTAINABILITY

GROWTH

The value of a business is the present value of the future cash flows that can be generated by the assets and other capitals utilised by the business. Growth in cash flows over time is generated through the optimal operation of the group’s capitals (organic growth) and building the tangible and intangible asset base of the group through developing and acquiring new businesses (inorganic growth).

Optimal operation of the group’s capitals generates growth in cash flow and thus value   2020 2019 Pro forma % change Income (Rm)   4 475 4 389 2 Ebitdar (Rm)   1 352 1 488 (9) Ebitdar margin (%)   30 34   Adjusted headline earnings per share (cents)   26.2 37.9 (31) Free cash flow (Rm)   484 414 17 Maintenance capital expenditure (Rm)   366 384 (5)			Building the tangible and intangible asset base of the group generates growth in cash flow and thus value.
			Investment activity expenditure of R211 million was incurred during the year on the acquisition of Southern Sun Pretoria and the Riverside Conference Centre.