Constance Hotels Services Limited | Annual Report 2025

ANNUAL REPORT 2025

27

Chairman’s Statement

Dear Shareholder,

steps to manage the effects of supply growth exceeding demand. In Madagascar, performance was satisfactory with ongoing efforts to broaden the mix of source markets. During the year, CHSL undertook the early repayment of MIC secured bonds, previously classified under equity. This resulted in a reduction in total equity and was accompanied by an increase in financial borrowings, with total debt rising from MUR 5.4 billion to MUR 6.4 billion. Finance costs relating to financial debt amounted to MUR 469 million (2024: MUR 472 million). Our commitment to evolve, adapt and drive constant improvement is central to the Company’s long-term success. In 2025, we made good progress on the strategic priorities set out in the three-year plan approved in December 2023: – We pursued our strategic growth objectives by signing a new management agreement in December 2025, effective 5 February 2026, for a five-star hotel in the south of Mauritius, to be operated under the name Constance Le Chaland. This was in addition to the three properties we added to our portfolio the previous year. – We completed our brand expansion, evolution and architecture, and new corporate identity. – A major renovation, upgrade and extension programme for our properties in Mauritius, Seychelles and the Maldives started during the year. – Sales and marketing efforts in the Maldives were intensified, with a particular focus on the Chinese and Japanese markets. – Shareholder returns improved, with return on equity increasing to 7.5%, from 5.6% in 2024 and 5.5% in 2023. In parallel, ongoing investments were made in our people, loyalty programme, digital and artificial intelligence capabilities and sustainability practices, with the objective of further enhancing and personalising guest experiences, improving operational efficiency, and supporting revenue generation. Growing with Purpose

In 2025, demand for leisure travel remained robust despite ongoing geopolitical tensions, macroeconomic uncertainties and regional conflicts. Within this environment, your Company was well positioned to benefit from sustained demand across the destinations in which it operates, underpinned by the strength of its brands, the wide array of high-end offerings and the outstanding commitment and dedication of its people towards exceeding guest expectations.

“Against an ever-changing global backdrop and market challenges, strong governance is fundamental to the success of our business, as is the ability to stay agile and move at pace, while retaining focus on our long-term objectives.”

Tourism Trends in our Destination Markets

The resilience of global leisure travel demand was reflected across our principal destination markets, where tourist arrivals increased by 3.9% in Mauritius, 13.1% in the Seychelles, 9.8% in the Maldives, and 4.3% in Madagascar.

Your Company

Your Company delivered a good financial performance for the year under review, driven by its market positioning, effective revenue management and continued focus on cost control. Revenue of MUR 6,484 million (2024: MUR 6,149 million) was achieved for the year, resulting in a net profit of MUR 432 million (2024: MUR 337 million). Our properties in Mauritius and the Seychelles remained key contributors, driven by sustained demand and stable market conditions. In Rodrigues, the two managed properties progressed through their integration and stabilisation phase. Performance remained constrained by air access, with improvement anticipated over time following the development of the planned new airport, which is set to increase air seat capacity and enable higher occupancy levels. The Maldives continued to operate in a competitive environment characterised by sustained growth in hotel room supply, which influenced performance. We continue to take appropriate