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Airtours unveils £7 70m fund


AIRTOURS chairman David Crossland has vowed to continue its expansion plans in Germany after revealing £770m has been set aside to make further acquisitions abroad.



The bullish approach came as Airtours announced year-end profits of £150.9m, up 12% on 1998. The figures take into account the £4.5m cost of its failed bid for First Choice and £1.1m goodwill amortisation.



Crossland said he was ‘disappointed but not surprised’ at losing out on the bid for German tour giant DER but stressed other deals will follow in Germany.



Crossland said: “We believe there was considerable daylight between the bids but German Railways which owned DER did not want to sell one of its national assets to a foreign company.” Airtours is said to have offered £300m.



He stressed other opportunities are being explored in Germany but declined to name specific targets.



He said: “At the moment we are talking to between 10 and 20 companies internationally.”



He said expansion with FTi will continue with the doubling of its three-strong Fly Fti fleet – Airtours already has a 36% stake in the company.



Access to hotels is also becoming increasingly crucial to the business.



Crossland said hotels are becoming ‘scarce commodities’ as countries apply strict planning conditions. “Hotel expansion in the Mediterranean and Caribbean is a priority,” he added.



Airtours has acquired the remaining 50% of a joint-timeshare venture in Florida which will allow the development of hotels as well as expanding the timeshare properties. Meanwhile, Airtours results bolstered its share price by 28p to 357p. The strong figure appeared to have a knock-on effect for the tour operating sector, with First Choice shares rising 8.5p to 133p and Thomson increasing by 14p to 98p.



TABLE: Spending spree: Crossland and Byrne are looking forward to a raft of international expansions



Airtours’ year end results to September 30, 1999:



n Group pre-tax profits up 12% to £156.5m.



n Turnover up 23% to £3,771.3m.



n UK profits down £600,000 to £104m.



n Strong performance for Scandinavian Leisure Group.



n West European Leisure Group reported higher losses.



n Other European operations up 100% to £34m.



n North America Leisure Grouplosses increased from £1.1m to £10.9m.


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