State-owned Windhoek Country Club Resort and Casino (WCCR) registered N$54 million in gross operating profits for 2014, a quantum leap from N$19 million posted in 2009.
The resort’s good financial performance elicited praise from the Minister of Environment and Tourism Pohamba Shifeta, who went on to challenge the two state-owned hospitality companies, Namibia Wildlife Resorts (NWR) and Zambezi Waterfront to pull up their socks and perform like the WCCR.
“I am so glad that today I do not have to castigate but can congratulate a company that adheres and abides by the rules, is transparent and professional,” Shifeta said, when WCCR presented its latest annual report this week.
Shifeta said he is assessing the non-performance of NWR and Zambezi Waterfront and believes that “NWR was a sick and spoiled baby and needed to pull up its socks to perform”.
Minister of Public Enterprises, Leon Jooste said, “I am obsessed with corporate governance principles in my new ministry. I wish to use WCCR as a benchmark and hope that other companies will follow suit… I am impressed with the Country Club – not only their financial performance but also their constant re-investment in – for example – infrastructure, which is vitally important to ensure efficiency and effectiveness.”
Commenting on the results, board chairperson of the resort Sven Thieme said the Country Club’s revenue rose by 32.8 percent, thanks to an increase of 39.3 percent in hotel turnover and a growth of 29.3 percent in casino revenues. “Results have been up in all categories and the hotel has been booked 100 percent on numerous occasions. The conference and events facilities have also experienced an upswing. We exceeded our target of N$50 million gross operating profit set by the board over and above the normal budget,” he said.
The resort’s gross margin strength increased from N$60 million to N$89 million, representing a 47.7 percent increase. Operating profit is up from N$12.6 million to N$28.8 million, which Thieme attributed to good management of expenses control. Net profit for the period under review improved from N$9.2 million to N$28.4 million. Income tax also increased as a result of the deferred tax asset provision from N$4.5 million to N$10.5 million while total operations for the period under review resulted in an increase of total comprehensive income from N$4.6 million to N$17.9 million.
A pleased Shifeta said he believed that a company’s success is greatly dependent on the board that serves the company. He also emphasised that a commercial company serves the interests of shareholders, creditors, employees, the public and the entity itself. “The board has a fiduciary duty and I, for one, wish to praise the [resort’s] board for making us proud,” said Shifeta.
Jooste, remarked: “I was so happy to come here this morning, as I am desperate for good news and today’s news was even better than I anticipated.”
Shifeta emphasised that he was in the process of appointing the “right boards with the right skills and integrity to take over at other companies to ensure that these would also become success stories – sooner, rather than later”.