Growing online firm On the Beach has defied travel sector turbulence to report a 776% leap in annual pre-tax profits.
The company, which suffered a loss of £2.5 million in 2015, moved into the black with a profit of £16.9 million in the 12 months to September 30.
Group revenues rose by 13% to £71.3 million in the period, with the UK representing £70.2 million bulk of the total.
Unique visitors to the company’s UK website increase by 12.6% to 61.3 million and revenue per daily unique visitor was maintained at £1.15.
Demand for beach holidays remained resilient despite the impact of repeated terrorist attacks on consumer confidence, the company said.
Low Cost Travel Group disrupted the dynamics of the online beach holiday market from the start of 2016 until its failure in mid-July, chief executive Simon Cooper said.
“We believe that overall demand for short haul beach holidays was suppressed versus the previous year but that a continued growth in online penetration will have resulted in our addressable market being flat year-on-year,” he said.
“As one of the most visible online beach holiday brands we remain well-placed to benefit from this ongoing structural shift in consumer behaviour.”
Consumer confidence was impacted both before and after the Brexit vote in June while terrorist atrocities in Nice and Brussels dampened consumer confidence, resulting in a shortening of booking lead times and “ultimately transient shrinkage in the overall number of passengers taking short haul beach holidays”.
Late availability of properties in key destinations in the western Mediterranean was limited following a Europe-wide exodus from the eastern Mediterranean.
Cooper said: “These results are testament to the strength and flexibility of our agile business model amidst difficult conditions in the travel industry.
”During the year, the group has showcased its unique strengths and attributes to deliver profitable growth.
“On the Beach continues to use its modular technology platform to innovate and deliver value and flexibility to an increasing audience of beach holidaymakers.”
He added: “Using our scale to drive exclusivity, our technology to drive innovation and our financial strength, Atol protection and strong consumer brand to drive customer trust, we are well placed to capitalise on the structural changes in the market which will only accelerate given the difficult conditions in the market this year.
“We remain confident in the resilience and flexibility of our business model, and the long term resilience of our sector.
“On the Beach continues to successfully build a leading position as more consumers discover the ease of use and wide choice of beach holidays that our platforms offer.”
Chairman Richard Segal said: “We expect and have planned for some of the key trends seen in FY16 to remain prevalent in FY17; namely the shift in demand from the eastern Mediterranean, the overcapacity of seats versus demand on high volume routes leading to aggressive seat-only pricing and pressure on bed capacity in key western Mediterranean destinations in peak periods.
“The board also believes that some of the wider macroeconomic trends will lead to a shortening of lead times throughout FY17, similar to those witnessed in the lead up to summer 2016.
“Notwithstanding these conditions, the board remains confident of meeting market expectations for the financial year and will provide a further trading update at our AGM on 2 February 2017.”