CEO Andrew Widegger takes an in-depth look at the year’s highlights and what’s next for the group.

Andrew Widegger, CEO of City Lodge Hotels

Question: What stands out when looking at fiscal year 2024?

A: What really stood out this year was how our deliberate focus on reinvestment translated into tangible benefits for our guests, our employees and the wider business. In a challenging macroeconomic environment characterized by high inflation and weak corporate travel, we demonstrated resilience by increasing revenue by 13% and increasing occupancy by two percentage points to 58%. Our food and beverage revenues also increased significantly by 22%. Additionally, our BAR pricing strategy continues to effectively optimize prices by delivering value to our guests. Beyond these encouraging figures, what sets this year apart is that we strengthen our foundation by investing in both our people and our properties. These efforts have not only made life easier for our guests and teams, but also strengthened the long-term sustainability of the business.

Q: Can you tell us about some of this year’s strategic developments?

A: One of the most important issues that stood out was our strategic reinvestments in various areas. From completing the second phase of our solar installations, where 41 hotels now benefit from renewable energy, to enhancing our food and beverage offerings, these initiatives reflect our commitment to sustainability and guest satisfaction. We have also completed significant renovations that will ensure our facilities not only meet but exceed guest expectations. This ties into our philosophy of investing in ourselves so that our guests, staff and organization can experience a smoother, more comfortable journey.

Q: What were your main challenges and how has your business adapted?

A: We started the year with strong demand; Our occupancy rates were approximately eight points ahead of those in the first quarter of the previous year. But prolonged high inflation, rising interest rates and continued burden-easing, combined with political uncertainty ahead of South African national elections, have begun to weigh heavily on corporate demand and consumer purchasing power. Government austerity measures implemented by the National Treasury in October further reduced demand. While the fastest recovery in occupancy and rates has been seen in the Western Cape, regions such as KwaZulu-Natal have faced challenges such as sporadic beach closures, the closure of many Durban waterfront businesses and safety and security concerns. Despite these adversities, we have adapted by expanding solar initiatives and continually investing in our properties, focusing particularly on operational efficiency in energy management. These actions have helped us maintain competitive occupancy levels and increase our food and beverage revenue.

Q: How did compliance with the principle of convenience contribute to the group’s success this year?

A: Controlling easy positioning helped us strengthen our brand in a new and interesting way. The updated visual identity and fun, quirky personality we adopted resonated well with guests and staff. It has enabled us to remain competitive and create a more memorable and enjoyable experience for our guests. One of the highlights was our ‘Bedtime Stories for Businessmen’ initiative. This is a simple yet innovative way to help our guests relax and the feedback has been fantastic. Being recognized with various awards reinforced that we were on the right track with our marketing efforts. These initiatives strengthened our brand’s presence, helped us establish a deeper connection with our target audience, and contributed to increased occupancy rates. They show that when you focus on delivering a great guest experience, results come naturally.

Q: How are you positioning your business for the future?

A: By continuing to invest in technology and sustainability, we are positioning ourselves for future growth. We are exploring new energy storage solutions to complement our solar installations, build water resilience through drilling, filtration and water storage installations, and have registered capital commitments of R459.4 million for financial year 2025, with a focus on hotel modernization and technology investments. including a redesigned loyalty program. We are also pursuing expansion opportunities in South Africa’s fast-growing regions, further strengthening our footprint and delivering long-term value to our shareholders.

Q: Would you like to acknowledge any contributions to our journey this year?

A: Definitely. Our shareholders have once again shown great faith in our strategy, and I am deeply grateful for their continued support. I also want to thank our staff who provide exceptional service no matter what challenges they may face. Their commitment to convenience is vital to maintaining our high level of guest satisfaction, even under challenging working conditions. Finally, I would like to thank our guests who choose us as their home away from home for their loyalty and trust.