City Lodge, which owns the Courtyard, City Lodge, Town Lodge and Road Lodge brands, has warned that its profit has halved for the six months to end-December.
Its normalised headline earnings will fall by between 49% and 54% to between R83.3 million to R75.1 million.
The group blamed “weaker trading conditions” as well as the impact of adopting the IFRS 16 accounting standard - the International Financial Reporting Standard for the accounting of its leases.
Excluding the effects of implementing IFRS 16, its headline earnings would have between 27% and 32% lower.
City Lodge’s share price fell almost 5% on Tuesday morning following the profit warning.
It is now trading at around R68 – after reaching R164 less than two years ago.
The company plans to release its result on or about 20 February 2020.
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