In her chief financial officer’s review, Dhanisha Nathoo reflects on the year under review: “The embedding of the dynamic pricing strategy (room rates up 7%) and the enhanced food and beverage offer (food and beverage revenue up 8%), have offset the softening of occupancy demand which decreased to 56% compared to 2024. Group revenue increased by 3% to R2bn. Focused discipline on cost containment held operating cost increases at 4% for the year. These operational efficiencies have helped to deliver stable profits for the year of R213m (up 13%) and adjusted HEPS growth of 9%.”
The following excerpt is from the question-and-answer section with chief executive officer, Andrew Widegger, in which he discusses highlights of the past financial year and all the group has achieved as it celebrates its 40th anniversary, plus the next phase, which will be about growth, innovation, and continuing to deliver hospitality with heart.
Q: What were the key strategic shifts or successes that defined 2025?
A: This year, we made a deliberate transition from recovery to growth. That meant shifting from a defensive posture, appropriate for the early post-Covid period, to a forward-looking strategy focused on revenue growth, innovation and guest experience.
This shift is already evident across the portfolio. To date, 30% of our rooms have been newly constructed or refurbished. These upgrades go beyond aesthetics to modernise our offering, enhance sustainability, and ensure each brand remains relevant and competitive.
Innovation remains central. We launched a new website aligned with our check into easy brand promise, piloted the Buzz app for pre-order dining, and began replacing our legacy property management system.
The groundwork for our enterprise resource planning platform is also underway and will digitise, connect and future-proof our core operations.
Q: City Lodge Hotels marked its 40th anniversary this year. What does this milestone represent for you and the business?
A: Celebrating 40 years of welcoming guests was a proud and deeply personal moment – I’ve been part of this journey for 32 years. Watching and being a part of growing the company from a small portfolio into a multi-brand group with national and international reach has been remarkable. We’ve weathered multiple economic cycles, adapted to disruption, and emerged from Covid as a more agile, future-ready business.
Personally, what I’m most proud of are the stories of individuals who joined us decades ago in entry-level roles and now lead hotels or sit at the leadership table. That kind of continuity speaks volumes about who we are. It’s a living testament to our identity as a people-focused business. And that matters deeply, because it’s our people who have always been, and will continue to be, the key to our success. Their resilience, care, and professionalism have carried us through expansion, crisis, recovery, and now, growth.
City Lodge Hotels has always been about people caring for people. That ethos remains our anchor, not as a relic of the past but as a living principle that drives us to keep adapting, performing, and delivering meaningful, people-centred hospitality to every guest we welcome.
Q: How would you summarise the past year’s challenges and how has the business responded?
A: The 2025 financial year was shaped by uncertainty. While there were encouraging signals, including signs of cautious optimism following the formation of a Government of National Unity and easing interest rates, overall trading conditions remained inconsistent.
Business travel was hesitant, the consumer remained under pressure, and global geopolitical instability weighed on sentiment. Our approach to portfolio optimisation remains disciplined. City Lodge Hotel Katherine Street permanently closed its doors in December 2024 after 35 years of operations, with demand consolidated into our three other Sandton properties. The hotel was sold for R68m, and a portion of the proceeds was allocated to share buy-backs.
Looking ahead, we continue to assess our current portfolio, explore new build opportunities, consider property extensions, and evaluate acquisitions that align with our purpose and growth ambitions. Every decision – whether to invest, reposition, or release – is guided by guest demand, market context, and a long-term perspective.
We are proud of our history, strengthened by the challenges we have overcome, and intentional in how we move forward. This next phase is not just about growth; it’s about growing with purpose, clarity, and confidence in the future we’re building.
Q: What role has culture played in setting the tone for growth?
A: What sets City Lodge Hotels apart is not only strategy but also execution, which ultimately comes down to people. Over the past few years, we’ve made a deliberate shift in our culture. Built on a foundation of loyalty, consistency, and care, we have evolved into a market-driven, performance-led business anchored in accountability.
Our general managers are empowered to act as entrepreneurs, with a clear mandate to enhance the guest experience and deliver results. Supported by training, clear KPIs, and innovation initiatives like the WOW Group Innovation Committee, our team is taking ownership of the guest journey in new and creative ways. They are incentivised to actively manage their rates to optimise revenue, with the assistance of the AI tools and the central revenue management team.
This cultural evolution has not diluted our values; it has deepened them. Accountability, respect, integrity, and confidence remain our guiding principles. Our new mantra, Make every guest a returning and referring guest, encapsulates both the heart and the ambition of our business.
Q: One of City Lodge Hotels’ long standing leaders retired this year. Can you tell us about his contribution?
A: Yes, this year we bid farewell to Tony Balabanoff, our divisional director of operations, who retired after 39 years with the group. Tony has been with City Lodge Hotels since its earliest days, and his influence is deeply ingrained in the fabric of the business. From foundational operations to our most recent innovations, he has played a pivotal role in shaping how we work and who we are.
Tony’s commitment, humility, and operational excellence have left a lasting mark, inspiring many. His legacy is deeply rooted in our culture, and his presence will be sorely missed. We thank him for a lifetime of service and for helping build the values that continue to define who we are.
Q: How is City Lodge Hotels building on its legacy to shape what comes next?
A: We are building on a foundation shaped by years of care, excellence, and a deep commitment to people. Our growth strategy is active, our portfolio is modernising, our brands are diverse and relevant, and our teams are energised. While the operating environment remains complex, we are no strangers to challenge. It’s our response that continues to set us apart.
