This is the third consecutive year that Gooderson which owns specialist hotels and lodges mainly in KwaZulu-Natal and Gauteng has increased its dividend.
Some shareholders might be surprised by the development since the figures released yesterday showed profits two-thirds lower than the previous year.
But comparative figures for the 2013 financial year included a R15m once-off profit from the sale of the Beach Hotel in Durban. Stripping this out, headline earnings increased 32% to 5.26c per share.
Revenue was up 9% to R120m, while Ebitda (earnings before interest, tax, depreciation and amortisation) profit reflecting a much fatter trading margin increased 19% to R16.2m. The Ebitda profit was backed up by stronger operational cash flow generation of R18.8m equivalent to 14c per share.
The company enjoyed a stronger second half. Interim earnings to end August 2013 came in at only 1.18c per share meaning more than 80% of earnings were generated in the second half (which includes the Christmas and New Year period).
For Gooderson to increase profits and dividends again in the financial year ahead looks a tough task. Chairman Alan Gooderson said that trading in the first three months of the new financial year had been difficult due to inactivity prior to the general elections. But he said Gooderson would pursue significant opportunities to invest capital in its growth strategy.
The company is proceeding with developments at its Monks Cowl Golf Resort in the central Drakensberg which includes the construction of 16 new rooms and eight self-catering rooms, a new swimming pool and an adventure golf course.
These developments should be ready by November or December this year. Gooderson's shares were unchanged yesterday at 70c, offering a large 54% discount on the last stated net asset value.
Trading conditions into the first three months of the financial year have been difficult due to inactivity prior to the elections. It relaunched Dumazulu Game Lodge and Traditional Village and constructed a walk-through Bird and Reptile Park at a cost of R1m which was officially opened by King Goodwill Zwelithini in March.
