Rainbow Tourism Group Limited has delivered a resilient performance for the financial year ended 31 December 2025, with revenue growing by 13 percent to US$50.3 million from US$44.4 million in 2024, underpinned by commercial diversification, cost leadership and a record capital investment programme.
In his Chairman’s statement, Douglas Hoto said the Group maintained a stable financial position despite increased investment activity and portfolio expansion, with gearing strategically increased to 24 percent from 8 percent as debt facilities were utilised to finance high-value growth opportunities. In his report, Group Chief Executive Tendai Madziwanyika said the results reflected disciplined operational execution across four strategic pillars: protecting and growing the core business, diversifying earnings beyond rooms, improving the cost base, and pursuing expansion only where it strengthens long-term earnings quality.
Key operating metrics improved markedly. Occupancy rose by 300 basis points to 57 percent from 54 percent, Average Daily Rate increased 7 percent to US$109 from US$102, and Revenue Per Available Room grew 13 percent to US$62 from US$55. Gross profit margin improved by four percentage points to 74 percent from 70 percent, while rooms profitability increased from 81 percent to 85 percent. Although headline EBITDA softened to US$7.8 million from US$9.7 million due to expansion-related costs including acquisition interest, depreciation and legal fees for new deals, adjusted profit before tax excluding once-off costs reached US$5.4 million, 54 percent ahead of the prior year.
A major highlight was growth in foreign currency earnings, which rose 28 percent to US$24.1 million and accounted for 48 percent of total revenue compared to 43 percent in 2024. Management said this was achieved by deliberately replacing lost donor-funded business following the withdrawal of USAID funding, which cost an estimated US$3 million in potential revenue, with commercial, regional and conferencing business. Conferencing revenue grew 6 percent year-on-year, with Bulawayo Rainbow Hotel generating US$1.13 million at the Zimbabwe International Trade Fair alone, while the Group’s South Africa office opened access to new regional source markets.
Cost leadership delivered tangible gains. Through strategic sourcing, competitive bidding and monthly business reviews at each property, the Group achieved 16 percent savings across its ten most consumed products and US$1.5 million in total savings. Food cost of sales declined from 20 percent to 16 percent, beverage cost from 18 percent to 16 percent, and overall Food and Beverage profitability improved from 63 percent to 68 percent.
The year 2025 was the most active period of inorganic growth on record, with total capital deployment of US$15.5 million. This comprised US$13.4 million invested in three strategic acquisitions and US$2.1 million directed towards refurbishment of the existing portfolio. Montclair Hotel and Conference Resort in Nyanga was acquired for US$5 million and integrated from 1 March 2025, contributing US$2 million in its first ten months while delivering procurement synergies through local sourcing of trout, apples and fresh produce that generated 14 percent savings across the portfolio. MSK House in Cape Town was acquired for US$8 million inclusive of capitalised interest and acquisition costs, marking RTG’s first entry into South Africa, a key source market, with preliminary works for its redevelopment into a four-star luxury hotel already commenced and full construction scheduled for 2027. Batoka Safaris Private Limited was acquired for US$0.4 million and consolidated under Heritage Expeditions Africa from 1 June 2025, contributing US$432,754 and strengthening the Group’s tourism experiences vertical.
On the product side, inventory at both A’ Zambezi River Lodge and Victoria Falls Rainbow Hotel underwent substantial upgrades and the two properties are now fully refurbished, strengthening competitiveness despite 88 rooms being out of service for 90 days, which saw Victoria Falls revenue dip to US$7.3 million from US$8 million even as occupancy in the destination improved from 64 percent to 67 percent. City hotels including Rainbow Towers, Bulawayo Rainbow and Kadoma Rainbow outperformed prior year with combined revenue up 6 percent to US$39.1 million from US$34 million. In July 2026 the Group completed a US$2 million refurbishment of Montclair, increasing its room stock from 85 to 110. Looking ahead, major product enhancements are planned for Montclair and Kadoma Hotel and Conference Centre in 2026 as part of a portfolio-wide modernisation plan.
Innovation extended to agriculture and sustainability. The Group launched RTG-Agro, a horticulture self-sufficiency programme across five hectares at Montclair, Kadoma and Rainbow Towers, currently producing 20 vegetable lines with potential annual savings of up to US$1 million at full scale, with Kadoma, Rainbow Towers, Montclair and A’Zambezi already sourcing 100 percent of green vegetables on site. On sustainability, the Kadoma solar plant generated 267,991 kWh of clean energy, resulting in a 31 percent reduction in energy costs, while a 2 megawatt grid-tied solar installation is planned for Rainbow Towers Hotel and Conference Centre in 2026, projected to produce 2,942,838 kWh annually and feed surplus into the national grid. The Green Stays programme delivered reductions in energy, water and chemical consumption, with refurbishments incorporating low-flow flushing systems that cut water usage by up to 30 percent per flush and smart key card systems to optimise electricity.
Human capital and social investment also featured prominently, with the Employer Assisted Housing Scheme extending benefits to 53 percent of employees against a target of 75 percent by end of 2027, and US$60,000 invested in community development, representing 2 percent of profit after tax, supporting health institutions and orphanages. The Group employs 620 staff and holds ISO 9001:2015 certification across all seven hotels, with ISO/IEC 27001 and ISO 22301 certifications attained in the first half of 2026.
In line with its commitment to shareholder value, the Board declared a second and final dividend of US$1.7 million, of which US$650,000 or 0.026 US cents per share was paid in foreign currency and US$1.05 million or ZWG1.057 cents per share in local currency, bringing total dividend for 2025 to US$2.8 million.
Looking to 2026, the company says it remains optimistic, supported by anticipated improvements in agricultural output, continued activity in mining, airlines and government projects, rising conferencing volumes, a strong pipeline of national and regional events concentrated in Harare and Victoria Falls, and growing contributions from Montclair, Heritage Expeditions Africa and the digital platform Gateway Stream.
