Hotel group up 17% on JSE return
Johannesburg - The market initially greeted KwaZulu-Natal-based hotel and timeshare company Gooderson Leisure with open arms on its re-entry to the JSE, with shares fetching a premium of as much as 17% on the company's Tuesday trading debut.
By lunchtime, though, the share price seemed to have settled at the 95c/share mark - an 11.8% premium to the 85c/share listing price. With 120m shares in issue (just over a fifth of the company's authorised share capital of 500m shares), that puts the company's market capitalisation at R114m.
Using the company's earnings per share for the year to end-February, the company listed on a price-to-earnings (PE) ratio of 10 times, which is not too expensive.
Gooderson manages timeshare resorts and lodges that include The Fairways, Riverbend Chalets and Mountain View in the southern Drakensberg; the Silversands I, II, III in Durban; Mtunzini Chalets on the north coast of KZN; Bushlands Game Lodge and DumaZulu Traditional Village Lodge near Hluhluwe; the Tropicana and Beach hotels in Durban and the Drakensberg Gardens and Natal Spa Resort.
According to the company's prospectus, listing on AltX -improves the company's ability to raise capital for strategic acquisitions.
"Gooderson will be favourably positioned for the anticipated growth in tourism, which is supported by international conferences in the region, events that will culminate with the 2010 Soccer World Cup and thereby ensuring that the company will maintain its revenue growth rate of more than 10% over the next three to five years."
The company reported R64m in revenue and earnings before interest, tax,depreciation and amortisation (Ebitda) of R15.3m, placing the company on an Ebitda margin of 23.8%.
First listing
Gooderson first listed on the then Johannesburg Stock Exchange in 1968. It was delisted when Alan Gooderson, the current CEO and chairperson, took over the reigns from his father.
This is the second listing in the hotel and leisure sector for 2006; the first, IFA Hotels and Resorts reverse-listed into the Moribo cash shell, owns KZN's Zimballi Lodge and has a stake in the Cape's Bosechendal wine estate.
Gooderson says the tourism sector has much going for it, which in turn bodes well for the company.
"The company's customers consist of tourists (local and international), conference delegates, corporate clients and timeshare owners for which the company manages the resorts.
More than 70% of the beachfront hotels? customers are black, with international tourists accounting for the remaining 30% occupancy. The hotels have been exposed to the growing middle class over the years, which resulted in a rise in occupancy rates.
The hotels' location and conference venues have positioned the group ideally for the conferencing circuit," it said.
News source: www.news24.co.za
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