Idube Gave Reserve

Interim payments offer job security for Idube and Lukimbi staff

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When President Cyril Ramaphosa announced a 21-day lockdown in South Africa from 26 March 2020, the team at Idube Game Reserve and sister property Lukimbi Safari Lodge, had little idea what to expect.

 

They certainly didn’t expect the storm which swept through Lukimbi on the night of 26 March, damaging roofs, uprooting trees and destroying walkways. It was a dramatic start to a challenging year – and as Financial Director Marilyn Marais explains, Lukimbi started off months of lockdown and uncertainty by calling on their policy to pay out storm damage.

 

“Of course, it was weeks before the insurance assessors could get to the property because of COVID and the lockdown. But once they did, we got paid out quickly for the storm damage.”

 

Focus soon turned to cover of a different sort, with Marilyn lodging a business interruption claim for both Idube and Lukimbi in April 2020.

 

And although the process has been long and frustrating (with resolution in the Santam/Ma Afrika case not expected before August 2021), Marilyn says that interim payments have carried them through and provided a measure of relief.

 

“When the first payment came through, we really needed that little bit of relief. Firstly, we had no income coming in at all, but secondly, people were asking for their deposits back. We followed the policy that if guests simply weren’t in a position to postpone their trips because of COVID, then it would be unreasonable not to offer refunds. As you can imagine, the money was going out in that direction as well.”

 

In April 2021, a full year after the process was started, Idube received a second interim payment, which, in total, covered the first three months of lockdown.

 

“SATIB was involved from the beginning, not only because they advised us to take on the claim, but because they have been tracking the progress all the time. And they really have been tracking it, there has been constant communication. I felt that there was support all the way – and there still is.”

 

Lukimbi, which is a much larger lodge than Idube, received a 3-month interim payment earlier in May, and although the amount is short of what the team was expecting, Marilyn explains that their financial documents and figures have been accepted, and Lukimbi is looking forward to an additional payment.

 

For Marilyn, the biggest impact of the interim payments has been that they can make the staff at both lodges feel more secure in their jobs.

 

“Our focus has always been on making our valued staff members feel secure. At Idube, one of the first things we did was dispense with directors’ salaries. No director has received one cent in salary since June last year. It was a slightly different situation at Lukimbi, but we did take a cut in salary. We’ve really tried to keep things tight. But it’s been an awful situation, both for the staff we’ve kept and the staff we’ve lost.”

 

Would Marilyn have done anything differently? In her words, probably not. It’s been an impossible situation, one that you just couldn’t plan for.

 

“It’s been a long year and we’re obviously still waiting on the outcome of the court case to determine the way forward, but in the meanwhile we can survive. And we will survive.”

 

For Idube and Lukimbi, who both rely on international visitors, the sole focus over the next few months is to reduce their loss rather than to achieve a profit. But there is a glimmer of hope – from the South African market and from international visitors, who are keen to return.

 

“Thankfully, the South Africans are coming in, but the reality is that it is not a big market. The cake, in terms of local visitors who are willing to pay for a private lodge, is not big and it’s getting sliced into very, very small pieces.”

 

For the first time though, Marilyn is feeling a spark of “crazy optimism”.

 

“Forward bookings are looking, dare I say it, vaguely hopeful. But it’s overseas visitors, so we fully accept that they may have to cancel. Twenty-twenty bookings became 2021 bookings, and now they’re putting it forward to 2022. And that’s lost revenue. But, saying that, I definitely feel more hopeful now.”

 

And advice to others who might be considering or waiting on interim payments? Read and understand your paperwork, says Marilyn, and lean on your broker for support.

 

“These are just interim payments. They should not affect future payments, so clarify what still needs to be done and press forward. We were determined to keep our core staff, and really look after the people we want to build our business with in the future. The interim payments have allowed us to continue to pay their salaries, and give them security. That is what this process has done for us – taken away a little uncertainty for our team.”

 

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