The Australian Pacific Touring (APT) Group is on the acquisition trail to offer more experienced-based holidays to its global customer base.
Owner Geoff McGeary said the global tour and cruise operator already has “irons in the fire” that could lead to acquisitions or new partnerships in the next six months.
In the UK, the family business sells mainly through tour operators rather than direct to travel agents. It has annual global passenger carryings of more than 300,000.
The UK is its largest international market, while Australia and New Zealand make up around half its customers. Annual revenue is about £200 million annually, and average UK selling prices are £2,500.
He said: “A downturn is the best time to look at acquiring companies. We are looking for enterprises where we can enhance the holiday experiences we offer – not flop-and-stop breaks.
“People are less destination focused. We are looking at companies that specialise in unique experiences. There is a move away from herd tourism, there is no doubt about that.”
At the end of May, the company bought a majority stake in luxury UK-based rail specialist GW Travel, famed for its flagship train, the Golden Eagle Trans-Siberian Express. McGeary said: “We want to add value to GW Travel’s operation, which has tended to be very UK focused. We will definitely sell it to a more global market.”
Rail and cruise travel are areas ripe for expansion, according to McGeary, who said financing further acquistions is likely to come from banks and private investment.
The APT group currently has 13 brands in its portfolio, including its APT tours business, river cruise business AMA Waterways, and bus tours business Topdeck, which targets 18 to 35-year-olds.
It is also expanding its product range, with plans to add more wilderness lodges in Australia. It has 23 lodges, modelled on African game lodges in remote locations. “If people are travelling to the other side of the world, we want them to see something different. We are going flat out to expand tented lodges and camps,” he said.
The group’s expansion is continuing, although at a slower pace in some areas, despite the recession.
McGeary argued the APT group has been less affected by the recession because its core markets – retirees and 18 to 35-year-olds – are themselves less affected. “Both extremes are recession proof. It’s the ones in the middle with the mortgages that are not.”
The major change during this recession is the fact travel no longer sits on a back-burner in times of crisis, he said.
“This is my eighth recession in the industry; some I didn’t even notice. The worst was 1989-1991. What’s changed this time is the customers.
“In 1989/90 people said they would not travel. Holidays are now much higher priority. In the past, retirees would not have their holiday because they had a new car, for example; now it’s the other way round. They will have a holiday and the car will wait.”
But he added: “A lot of clientele have ‘pushed the pause button’, but enquiry levels are very high, which is always a good sign.”
McGeary attributed this change in priority as one reason why the car industry has taken a bigger hit than travel during the recession. He believes travel will come out of the recession in 2011/2012.
However, McGeary joined others in criticising rises in Air Passenger Duty, saying they will not help the UK out of the recession. “It’s like the government legislating against travel. It’s more likely to damage business in the UK long term,” he argued.