Constance Hotels, Resorts and Golf | Annual Report 2023

16

Strategic Insights

Constance Hotels Services Limited

Annual Report 2023

17

Strategic Insights

Constance Hotels Services Limited

Annual Report 2023

Chairman’s Statement

Chairman’s Statement

Dear Shareholder,

the development of a new loyalty programme. Our commitment to deliver True Service to our guests is reflected in the continual high scores achieved by our properties on the Global Review Index, the industry-standard online reputation benchmark, and guest satisfaction surveys.

in Rodrigues will, also, be extended in anticipation of the upcoming airport expansion and increased air capacities. We will be launching our Echo Privilege Card; applying the newly signed 20-year extended management contracts for the two properties in the Seychelles; and continuing to explore opportunities to expand our hotel portfolio, with a focus in the Indian Ocean. The outlook for 2024 appears promising, with booking trends continuing to be robust. However, we must remain cautious due to ongoing geopolitical uncertainties across the globe, which could potentially dampen the flow of leisure travellers, especially during our low season. On the upside, we anticipate an increase in cross border travel from our principal Asian markets, including Japan, South Korea, and China. In the face of the difficult human resources challenges within the entire hotel industry over these past years, your Company has maintained its commitment to service excellence, thanks to the professionalism and dedication of its People. This is reflected in the record employee engagement score achieved in 2023. The Board expresses its deep gratitude and appreciation to the Company’s talented, devoted, and loyal team members, all of whom have demonstrated remarkable adaptability and resilience. We extend our sincere thanks to the Chief Executive Officer and his Management Team for their skilled and decisive leadership, which has adeptly guided the Company over the past year. I am indebted to my colleagues on the Board for their active engagement, alongside the invaluable contributions of the Group Chief Executive Officer and his Management Team. Our shareholders, financial partners, loyal guests, and other stakeholders across the industry deserve special mention for their continued trust, confidence, and loyalty. Their enduring support fuels our commitment to excellence. OUR PEOPLE ACKNOWLEDGEMENT

In 2023, leisure travel demand continued to be robust, regardless of the ongoing geopolitical conflicts and uncertainties in many parts of the world. Your Company was well positioned to benefit from this sustained demand and new growth opportunities, buoyed by its unwavering dedication to product and service excellence, the provision of luxury properties in key market destinations, a broad and vibrant sales and marketing network, and the outstanding commitment of its People.

In December 2023, the Board approved a three-year Strategic Plan, the focus areas being to:

- Grow our hotel portfolio within the Indian Ocean. - Reinforce our brand positioning by leveraging our new brand architecture. - Continue to provide exceptional product and service offerings through digitalisation, quality innovations and the enhancement and extension of our properties. - Improve the Company’s top-line in the Maldives with better RevPAR. - Reduce our debt-to-equity ratio. - Increase shareholder return in a sustainable manner. As your Company explores and taps into growth opportunities, our commitment to ESG principles and sustainable practices, with a view to balancing sustainability, social responsibility and profitability, remains resolute. Our Sustainable Management Plan, which is continually assessed and updated to reflect new sustainability concerns, guides our people and operations by embracing the United Nations’ Sustainable Development Goals and other standards set by international organisations. We are progressing well with the implementation by 2030 of the 165 sustainability-related initiatives we launched in 2022. Our Green Globe Gold certification stands as a testament to our rigorous commitment to continuous improvement in our sustainability performance. Six of our hotels are expected to reach Platinum status in 2024. Your Board is aware of emerging governance challenges, including those of cybersecurity governance and reporting on Climate Change disclosures, and ensures that good Corporate Governance and best business practices are applied across your Company and its operations through adequate structures, diligent oversight and proactive engagement. OUR ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) COMMITMENTS

OUR OPERATING MARKETS

The surge in global leisure travel was reflected in our own principal destination markets, which achieved much improved tourist arrivals. Mauritius reported a 29.9% increase in arrivals compared with 2022. The increases for the Maldives and the Seychelles were 12.1% and 5.7% respectively. As anticipated, Madagascar maintained a strong growth trend for the year.

YOUR COMPANY

Notwithstanding the weaker than anticipated performance of our properties in the Maldives due to stiff competition, with the continual opening of new luxury hotels and a weaker than expected inflow of arrivals from Asia, all our other properties were able to capitalise on the buoyant global leisure travel. This resulted in your Company achieving record overall RevPAR, TrevPAR and EBITDA, and a most satisfactory 30% increase in Net Profit, in the face of higher expenditure relating to the strong resumption of activity, inflationary pressures and interest rate hikes. In 2023, having transitioned out of recovery mode, we were able to refocus on our hotel portfolio growth agenda set prior to the outbreak of the COVID-19 pandemic. In this respect, your Company entered into a partnership with Trimetys Ltd to manage and operate the Sakoa Boutik Hotel in Mauritius, and the Constance Tekoma and C Rodrigues - Mourouk Hotel in Rodrigues, effective 01 January 2024. The partnership also encompasses equity investments in both hotels in Rodrigues. We are now present in five authentic destinations in the Indian Ocean with a new brand architecture and a portfolio of eleven properties. This enables us to deliver a more comprehensive range of products and service offerings to attract a broader cross-section of leisure travellers and drive growth. During the year, we pursued further product and service innovations and engagement with our guests through enhanced digitalisation, proactive quality monitoring and improvement, and GROWING WITH PURPOSE

Our commitment to deliver True Service to our guests is reflected in the continual high scores achieved by our properties on the Global Review Index, the industry-standard online reputation benchmark, and guest satisfaction surveys.” “

George J. Dumbell (s) Chairman

THE WAY FORWARD AND OUTLOOK

In 2024, we will begin deploying the actions earmarked in our new Strategic Plan. The three new properties under our management will have their operations upgraded to align with the Constance Standards and our commitment to excellence. The two properties