First half performance offers a sunny disposition for On the Beach
Online holiday group On the Beach was basking in the glow of better revenues and profits today as it announced interim results for the six months to March 31, and expansion in its Manchester operations.
The Cheadle-based firm reported a 19% increase in revenues of £45.3m, and a 9% improvement in pre-tax profits of £10.8m.
Net debt stands at £11.6m, compared with £2.3m, which reflects normal seasonal working capital requirements, and £12m for the funding of its Sunshine acquisition which it announced on this day last year.
On the Beach enjoys a more than 20% share of online sales in the short haul beach holiday market and is one of the UK’s largest online beach holiday retailers.
It says it has significant opportunities for growth and its long-term mission is to become Europe’s leading online retailer of beach holidays.
The firm’s UK revenue was up 19% to £44.4m, including an estimated impact of £1.1m for lost bookings due to winter seat availability and seat pricing following the failure of holiday airline Monarch.
Adjusted UK EBITDA was uo 17% to £17m.
The company said it experienced strong booking and share growth, supported by some modest and tactical discounting.
It daily unique visitor levels increased by 23.9% to 34.1m.
International revenues increased by 51%, compared with 20% last year, with Sweden enjoying its strongest period of trading since launch, supported by an increased investment in Sweden and Norway to accelerate growth.
The launch of a third international market in Denmark is planned for this month.
International EBITDA showed a loss of £1.6m, up from £1m a year ago.
Chief executive Simon Cooper said: “On the Beach has delivered a solid performance in H1, with strong booking and share growth supported by some modest and tactical discounting.
“Booking growth strengthened towards the end of the period and has continued into H2.
“As referenced in our AGM update on February 8, the flight capacity constriction following Monarch’s collapse has driven an increase in seat prices and a corresponding reduction in bookings.
“The position regarding flight capacity continues to recover as incremental capacity has been scheduled which alleviates this constriction.”
He said: “Given the resilient and flexible nature of our business model, the board remains confident in delivering a full year result in line with management’s expectations, taking into account the one-off impact of flight capacity constraints as a result of the Monarch failure and the accelerated investment to support International growth.
“To support our continued desire to attract and retain the best digital talent, we have signed a lease on a new digital HQ in Manchester which has the capacity to support our growth ambitions.
“Fit out work will begin shortly and we are scheduled to occupy this exciting new space by the end of 2018.”
The company also announced today that Richard Segal intends to step down as non-executive chairman, a position he has held since October 2013.
After a period of transition he will be succeeded by Lee Ginsberg, currently senior independent non-executive director, at a date yet to be confirmed.
At that time, David Kelly will become senior independent director.
Lee and David have both been on the board of the company throughout its life as a listed entity.
