(Alliance News) - On the Beach Group PLC on Monday said that while business improved in July following the easing of lockdowns, it has suffered another setback from the new four-week ban on international leisure travel imposed by the UK government.
The beach-holiday travel agent stated that as a result of travel restrictions and low levels of consumer confidence, booking volumes in the third quarter and fourth quarter of its financial year ended September 30 were down 75% and 53% respectively year-on-year.
As a result of strong cost control, however, adjusted pretax profit excluding exceptional costs and brand amortisation was kept at breakeven. For comparison, for financial 2019 adjusted pretax profit was GBP34.6 million
On the Beach noted that cancellation rates across the summer of 2020 have been over 90%, adding that it expects it to continue at this level over winter. The company said this has led to further exceptional costs of GBP10 million in the second half of the financial year, with the total figure for the full year expected to GBP45 million.
As at Friday, for the period from March 15, the company had refunded GBP160 million back to customers, comprising GBP90 million for flight refunds and GBP70 million for hotels and transfers. It said it has currently received GBP79 million from airlines for cancelled flights and is awaiting a further GBP11 million.
As at last Friday, On the Beach had cash of GBP50.5 million and access to an undrawn GBP75 million credit facility.
"It is clear now that the full impact of Covid-19 will be every bit as extreme as any of us could have mapped out at the beginning of the year. Following the overwhelming support we received from our shareholders in May, combined with our ring-fencing of customer prepayments, we are in a strong and debt-free financial position. The board is confident about the Group's long term strategy and we will continue to look at the increasing number of exciting opportunities to grow our market share both in the UK and internationally," said Chief Executive Simon Cooper.
Full results for financial 2020 will be published on December 10.
Shares in On the Beach were trading 5.3% higher at 279.07 pence each on Monday morning in London.
By Ife Taiwo; ifetaiwo@alliancenews.com
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On The Beach (OTB)