Southern Sun Limited · JSE:SSU
Southern Sun — H1 FY2025 Earnings Presentation
26 slides from Southern Sun's earnings presentation, November 2024
Slide 1: Investor Presentation November 2024
F’25 H1 • Revenue up 6% to R2.97bn • EBITDAR up 10% to R822m • Adjusted HEPS up 39% to 25.0c • Net debt at R995m SOUTHERN SUN INVESTOR PRESENTATION NOVEMBER 2024
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 or
Slide 3: Group Structure
GROUP STRUCTURE Public 45% 55% 100% 100% SOUTH AFRICA OFFSHORE • Owned, managed • Owned, managed and leased hotels and leased hotels • UK Investments – 26% 3
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
Slide 5: Southern Sun at a Glance
SOUTHERN SUN AT A GLANCE 90 OVER HOTELS & RESORTS in South Africa, 16,000 rooms OVER Africa, the Seychelles and 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
Slide 6: Operated Portfolio
OPERATED PORTFOLIO Luxury 54 Arabella HOTEL, GOLF & SPA BATH ) wo BEVERLY HILLS Q « — SANDTON SUN = SANDTON TOWERS MOUNT GRACE HOTEL © SPA w Qa nei. Y Southern Sun Full Service Economy Y SouthernSun Y stayeasy © SouthernSun ‘SUNL RESORTS: SUN SQUARE Y Garden Court Convention Centre SANDTON CONVENTIO
Slide 7: Cash Flow (Rm)
CASH FLOW (Rm) F’25 H1 F’24 H1 F’24 YE Ebitdar per income statement 822 745 1 902 Property rentals (170) (168) (340) Move in working capital adjusted for non-cash and exceptional items (81) 14 116 Dividend income from associate 7 10 18 Cash generated from operations 578 601 1 696 Net finance costs p
Slide 8: Cash Flow (Rm) Continued
CASH FLOW (Rm) CONTINUED F’25 H1 F’24 H1 F’24 YE Free cash inflow from operations (b/f) 154 289 970 Disposal proceeds 1 - 27 Investment activities – expansion capex (3) (67) (180) Exceptional items (10) - - Dividends paid to shareholders (167) - - Associates, loans and investments 21 - 107 Share buy
Slide 9: Investment Activities (Rm)
INVESTMENT ACTIVITIES (Rm) F’25 H1 F’24 H1 Investment activities 3 67 Beverly Hills professional fees 3 - Acquisition of Sunswop units - 3 Umhlanga land acquisition - 5 Birchwood acquisition - 59 Investment activities (c/f) 3 67 9
Slide 10: Investment Activities (Rm)
INVESTMENT ACTIVITIES (Rm) F’25 H1 F’24 H1 Investment activities (b/f) 3 67 Maintenance capex 215 137 Major projects 89 13 Southern Sun The Cullinan 39 9 Southern Sun Rosebank 25 4 Southern Sun Sandton 22 - Radisson Gautrain 3 - Western Cape 26 19 KwaZulu-Natal 1 33 34 Gauteng 1 37 42 Other 24 19 Of
Slide 11: Interest Bearing Debt (Rm)
INTEREST BEARING DEBT (Rm) F’25 H1 F’24 H1 External debt – Offshore (US$ based) 424 497 External debt (Rand based) 1 090 1 500 Prepaid borrowing costs (2) (3) Gross IBD 1 512 1 994 Cash on hand – Hotels SA (289) (352) Cash on hand – Hotels Offshore (228) (146) Net IBD 995 1 496 Analysed as: – Hotels
Slide 12: Debt Facilities, Liquidity and Covenants
DEBT FACILITIES, LIQUIDITY AND COVENANTS Interest-bearing debt net of cash on 30 September 2024 totalled R995 million, which is R29 million less than the 31 March 2024 balance of R1.0 billion, mainly due to the payment of a maiden dividend of R167 million in May 2024 and the increased cash outflow
Slide 13: Review of Operations
REVIEW OF OPERATIONS We are encouraged by the continued improvement in trading volumes over the six months ended 30 September 2024 and particularly strong trading in the month of September 2024 The group’s rooms revenue growth of 7% to R1.99 billion (F24H1: R1.86 billion) has been supported by a
Slide 14: Review of Operations
REVIEW OF OPERATIONS Food and beverage revenue was up 4% to R760 million (F24H1: R730 million) in line with occupancy growth, property rental income has grown by 21% to R114 million (F24H1: R94 million) while other revenue has decreased by 6% to R142 million (F24H1: R151 million) primarily due to
Slide 15: Review of Operations
REVIEW OF OPERATIONS Exceptional losses for the year of R13 million (F24H1: Rnil) relate to the pre-opening expenses incurred by Southern Sun Dar-es-Salaam Net finance costs of R115 million (F24H1: R139 million) include interest on capitalised leases of R67 million (F24H1: R68 million) – the cas
Slide 16: Review of Operations
REVIEW OF OPERATIONS The 19% increase in operating profits together with finance cost savings has resulted in a 31% growth in adjusted headline earnings for the six months ended 30 September 2024 to R334 million (F24H1: R255 million) The weighted average number of shares in issue has reduced fro
Slide 17: Quarterly Performance (Rm)
QUARTERLY PERFORMANCE (Rm) Q1 Q2 H1 Income F’25 1 390 1 576 2 966 F’24 1 326 1 464 2 790 Change on F’24 (%) 5 8 6 F’25 Occupancy % 55.3 62.6 58.9 F’24 Occupancy % 54.2 59.6 56.3 Ebitdar F’25 336 486 822 F’24 306 439 745 Change on F’24 (%) 10 11 10 Adjusted earnings F’25 116 218 334 F’24 95 160 255 C
Slide 18: Income Statement (Rm)
INCOME STATEMENT (Rm) % F’25 H1 F’24 H1 Change Income 2 966 2 790 6 Rooms revenue¹ 1 950 1 815 7 Owned stats F’25 H1 F’24 H1 Food & beverage revenue 760 730 4 Occupancy (%) 58.9 56.3 Property rental income 114 94 21 Average room rate (R) 1 338 1 297 Other income¹ 142 151 (6) RevPar (R) 789 730 Overh
Slide 19: Reconciliation to Adjusted Headline Earnings (Rm)
RECONCILIATION TO ADJUSTED HEADLINE EARNINGS (Rm) F’25 H1 F’24 H1 % Net of tax Net of tax Change Profit attributable to equity holders of the company 332 255 30 Profit on disposal of PP&E (1) - Pre-opening costs 13 - Derecognition of derivative financial instruments (6) - Share of associates’ except
Slide 20: Segmental Analysis (Rm)
SEGMENTAL ANALYSIS (Rm) Income Ebitdar Ebitdar margin % F’25 H1 F’24 H11 F’25 H1 F’24 H11 F’25 H1 F’24 H11 Sandton Consortium 318 333 99 105 31 32 SA Portfolio 2 477 2 284 716 649 29 28 Western Cape 861 757 277 221 32 29 KwaZulu-Natal 490 530 120 164 24 31 Gauteng 785 664 232 172 30 26 Other 341 333
Slide 21: Regional Review
REGIONAL REVIEW Gauteng The domestic and international corporate transient travel segments have recovered well over the interim period with demand for conferencing and events bolstering hotels located in prime business hubs near OR Tambo International Airport or Sandton Convention Centre By leve
Slide 22: Regional Review
REGIONAL REVIEW KwaZulu-Natal The group’s hotels located on the Durban beachfront are geared towards groups and transient business from corporates (including sporting bodies) and government, and demand from these segments slowed in the lead-up to, and immediately post, the national elections in Ma
Slide 23: Regional Review
REGIONAL REVIEW Other The Other segment includes hotels situated in Mpumalanga, Eastern Cape, Kimberley, Bloemfontein and Polokwane Like in Durban, these hotels are weighted towards corporate (including sporting bodies) and government groups and transient business both of which were negatively i
Slide 24: Prospects
PROSPECTS These results reflect the impact of the decisions taken by the group, amid and during its recovery, from the pandemic – the complete cost restructuring undertaken has meant that the group was able to deliver 10% Ebitdar growth from 6% income growth The reduction in debt levels and rela
Slide 25: Strategy
STRATEGY Getting more out of our irreplaceable hotel portfolio by allocating capital to key properties so that they remain best-in-class and our customers’ preferred accommodation provider Refurbishment plans scheduled for the 2026 financial year are progressing for several other hotels with var
Slide 26: Follow the Sun – Thank You
Follow the Sun THANK YOU