Southern Sun Limited · JSE:SSU

Southern Sun — H1 2024 Earnings Presentation

22 slides from Southern Sun's earnings presentation, November 2023

  1. Slide 1: Southern Sun Investor Presentation F'24 H1

    F’24H1 F’24H1 • Occupancy at 56.3%, up 10.3pp • Ebitdar at R745m, up 66% • Adjusted headline profit at R255m, up 1 400% • R389m in share buybacks SOUTHERN SUN INVESTOR PRESENTATION November 2023

  2. Slide 2: Disclaimer

    DISCLAIMER Certain statements in this document may constitute ‘forward looking statements’. Such forward looking statements reflect the company’s beliefs and expectations and involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance o

  3. Slide 3: Group Structure

    GROUP STRUCTURE Public 44% 56% 100% 100% SOUTH AFRICA OFFSHORE • Owned, managed • Owned, managed and leased hotels and leased hotels • UK Investments – 26% • Manco 3 3

  4. Slide 4: Board of Directors

    BOARD OF DIRECTORS EXECUTIVE DIRECTORS INDEPENDENT NON-EXECUTIVE DIRECTORS Marcel Nikolaus von Aulock Laurelle McDonald Mohamed Haroun Ahmed Lynette Moretlo Molefi Chief Executive Officer Chief Financial Officer Lead independent Independent non-executive director non-executive director NON-EXECUTIVE

  5. Slide 5: Southern Sun at a Glance

    SOUTHERN SUN AT A GLANCE OVER HOTELS & RESORTS 90 16,000 rooms in South Africa, Africa, the Seychelles and OVER Total Total Middle East from luxury to economy Hotels Rooms Luxury Western Cape 17 3 352 KwaZulu-Natal 14 2 869 Gauteng 30 5 167 Eastern Cape 5 772 Full Service Mpumalanga 8 675 Other 6 71

  6. Slide 6: Operated Portfolio

    OPERATED PORTFOLIO Luxury 54 Arabella HOTEL, GOLF & SPA ry) BEVERLY HILLS INTERCONTINENTAL, JOHANNESBURG ©.8,TANEO AIRPORT SANDTON SUN = SANDTON TOWERS MOUNT GRACE Qav adaise Se... WOTEL & SPA —w- a Y Southern Sun Full Service &Y SouthernSun HOTELS Y Southern Sun RESORTS SUN SQUARE Y Garden Court Ec

  7. Slide 7: Cash Flow (Rm)

    CASH FLOW (Rm) F’24 H1 F’23 H1 Ebitdar per income statement¹ 745 449 Property rentals (168) (131) Move in working capital adjusted for non-cash and exceptional items 14 44 Dividend income from associate 10 - Cash generated from operations 601 362 Net finance costs paid (excluding IFRS16 adjustments)

  8. Slide 8: Cash Flow (Rm) Continued

    CASH FLOW (Rm) CONTINUED F’24 H1 F’23 H1 Free cash inflow from operations (b/f) 289 191 Separation Payment - 390 Investment activities – expansion capex (67) (142) Disposal proceeds - 1 Dividend paid to NCI - (1) Share buyback (389) - Net cash surplus (167) 439 Net currency 13 20 Move in net IBD (15

  9. Slide 9: Investment Activities (Rm)

    INVESTMENT ACTIVITIES (Rm) F’24 H1 F’23 H1 Investment activities 67 142 Acquisition of Southern Sun and StayEasy Mbombela hotels - 142 Acquisition of Sunswop units 3 - Umhlanga land acquisition 5 - Birchwood Phase 1 acquisition 59 - Maintenance capex 137 34 Externally managed – investment properties

  10. Slide 10: Corporate Activity

    CORPORATE ACTIVITY  During May and June 2023, the group acquired an additional 89 million SSU shares at an average price of R4.35 which together with the 10 million SSU shares acquired in the prior financial year, brings the total SSU shares bought-back by the group to 99 million at an aggregate co

  11. Slide 11: Interest Bearing Debt (Rm)

    INTEREST BEARING DEBT (Rm) F’24 H1 F’23 H1 External debt – Offshore (US$ based) 497 596 External debt (Rand based) 1 500 2 200 Prepaid borrowing costs (3) (2) Gross IBD 1 994 2 794 Cash on hand – Hotels SA (352) (383) Cash on hand – Hotels Offshore (146) (58) Net IBD relating to continuing operation

  12. Slide 12: Debt Facilities, Liquidity and Covenants

    DEBT FACILITIES, LIQUIDITY AND COVENANTS  Interest-bearing debt net of cash at 30 September 2023 totalled R1.5 billion, which is R185 million more than the 31 March 2023 balance of R1.3 billion which is largely attributable to the share buyback of R389 million and capital expenditure of R216 millio

  13. Slide 13: Review of Operations

    REVIEW OF OPERATIONS  The group is encouraged by the continued improvement in trading volumes in South Africa over the six-month period ended 30 September 2023, particularly when compared to the prior comparative period, which was still impacted by the Omicron variant of Covid-19 with restrictions

  14. Slide 14: Review of Operations

    REVIEW OF OPERATIONS  This shortfall in occupancy largely relates to certain hotels in the Sandton and Rosebank nodes, the group’s budget offering Sun1 as well as certain hotels in the offshore division which have not yet fully recovered but are showing signs of improvement as the year progresses a

  15. Slide 15: Review of Operations

    REVIEW OF OPERATIONS  The increase in employee costs is attributable to inflationary salary increases implemented on 1 April 2023 as well as increased rostering of operational support staff in response to higher trading levels  As a consequence of continuous load shedding, R28 million (2022: R17 m

  16. Slide 16: Income Statement (Rm)

    INCOME STATEMENT (Rm) % F’24 H1 F’23 H1 Change Income 2 790 2 082 34 Rooms revenue 1 858 1 318 41 Food & beverage revenue 730 567 29 Property rental income 94 68 38 Other income¹ 108 129 (16) Owned stats F’24 H1 F’23 H1^ F’20 H1^ Overheads (2 045) (1 633) (25) Occupancy (%) 56.3 46.0 59.1 Average ro

  17. Slide 17: Reconciliation to Adjusted Headline Earnings (Rm)

    RECONCILIATION TO ADJUSTED HEADLINE EARNINGS (Rm) F’24 H1 F’23 H1 Net of tax Net of tax Profit attributable to equity holders 255 325 Separation payment - (313) Loss on disposal of PP&E - 5 Transaction & restructuring costs - 5 Impairment of trademark - 6 Share of associates’ exceptional items - (11

  18. Slide 18: Segmental Analysis (Rm)

    SEGMENTAL ANALYSIS (Rm) Income Ebitdar Ebitdar margin % F’24 H1 F’23 H1¹ F’24 H1 F’23 H1¹ F’24 H1 F’23 H1¹ Continuing operations Investment properties – Externally managed 77 54 76 52 99 96 Sandton Consortium 333 225 105 55 32 24 Internally managed 2 207 1 635 573 346 26 21 Western Cape 745 494 211

  19. Slide 19: Prospects

    PROSPECTS  The buoyant trading levels over the past six months have continued into October and November 2023 and we remain optimistic that this momentum will continue into December and the group’s fourth quarter, particularly in the Western Cape.  Thanks to the group’s national distribution and ab

  20. Slide 20: Prospects

    PROSPECTS  The group will continue to pursue its stated strategy of reducing debt levels while continuing to allocate capital to key properties in our portfolio, so that they remain best in-class.  Customer experience is central to Southern Sun’s value proposition and the group will continue to fo

  21. Slide 21: Notes

    NOTES Y Southern Sun

  22. Slide 22: Follow the Sun - Thank You

    Follow the Sun THANK YOU

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