Africa-Press – South-Africa. Zeda, the operator of Avis Southern Africa and the Budget car rental groups, flagged a major recovery in the inbound tourism market, reporting on Monday that its interim revenue more than doubled in this segment as foreign travellers appeared to return to SA.
Reporting results for the six months to end March, the company said inbound travel experienced a 138.7% surge in revenue, also indicating there was significant room for further growth. It noted its total car rental activities operated at 26.8% of the pre-pandemic levels, with “inbound still lagging at just below half of the pre-pandemic levels”.
“In addition to inbound, an expected increase in international airlines’ activities utilising chauffeur-driven vehicles presents us with an opportunity to continue to grow the business further in absolute terms,” said Zeda.
Another star performer for the group, reporting its first set of results since unbundling from Barloworld, was the corporate travel segment, which saw revenue increase more than a half.
The performances helped Zeda lift basic earnings per share 27% to 197c and saw its group revenue increasing a fifth to R4.45 billion. Operating profit increased by 25% to R803 million.
Zeda, which listed in December, said the car rental business as a whole continued to also benefit from a diversified model which included a subscriptions business, as well as “aggressively growing” the replacement car business in the insurance segment.
This, along with the recovery of inbound and corporate travel, as well as used car sales saw its car rentals division’s revenue grow 26% year-on-year to R3.3 billion. The corporate travel segment rose 69.5%
Zeda said its leasing business remains solid with revenue growing 6% to R1.14 billion year-on-year, benefitting from its decision to grow into “the heavy commercial fleet vertical, healthy resale prices of used vehicles and an increase in the sale of value-added products and services”. It said the segment also experienced increased activity levels within its corporate and greater Africa business.
“While the operating environment has been challenging, the group benefitted from its strong fundamentals and leveraged pockets of opportunity in rental and leasing to grow into less capital-intensive business such as maintenance and other value-added assets,” said CEO Ramasela Ganda in a statement accompanying results.
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