Terror attacks affect bookings at holiday firm

ONLINE holiday retailer On the Beach Group has said it remains on track to achieve expected profitability but highlighted the impact of recent terror attacks on holiday demand.

The listed Cheadle-based group said the flexibility of its business model had enabled the management team to focus  on profitable growth, despite acts of terrorism in both Turkey and the south of France, which it says has affected bookings and demand throughout the Mediterranean.

It also pointed to disruption caused by the administration of the Lowcosttravelgroup, although it did not did not sell any products sourced from the company, and wider macroeconomic uncertainty and weakening of sterling following the EU Referendum.

The group had been pinning hopes on a strong market for late bookings as summer approached but said the above factors meant siginificantly fewer consumers would be travelling this year.

This supply/demand imbalance has led to widespread discounting of seat only and packages by other travel agents, in many cases below cost, it said.

Simon Cooper, chief executive of On the Beach, said: “2016 has been an extraordinary period for the travel industry and On the Beach is proving its unique strengths and attributes against the backdrop of these challenges.

“Whilst revenue growth will be below our original plans as a result of market conditions, we have continued to outperform the market, stealing significant share. Our focus on profitable sales and cash margins will deliver a profit before tax outcome in line with the board’s expectations at the beginning of the financial year, which represents very strong double digit growth over last year.”