Dnata’s B2C brands Travel Republic and Netflights have reported losses of almost £6 million, according to the latest accounts filed on Companies House.
Profits at online travel agent Travel Republic dropped by £5.7 million in the 12 months to March 31 2019 compared to the previous year.
The OTA reported a £4 million loss after tax on revenue of £70 million compared to a £1.7 million profit the previous year on revenues of £57 million.
“(The) online market continued to be challenging, with competitor activity driving an increase in the cost of driving customers to the company’s website through paid search,” the report filed for Travel Republic said.
“Lack of confidence in the home economic environment caused by Brexit uncertainty, together with the broader global macroeconomic instability has led to pressure on revenue and margins,” it added.
Cost of sales increased to £62m in 2019, up from from £38 million, while admin expenses stood at almost £16.5 million, down from £22 million.
Sister brand Netflights reported a £1.7 million loss after tax on revenue of £4 million, compared to a profit of £43,000 the year before on revenue of £6 million.
Profits for its high street travel agency arm, Travelbag, dropped from £8.5 million to £1.06 million.
“The squeeze on consumer holiday spending drove year on year reductions in holiday duration, product down trading, and a shift from long haul to short haul as customers looked to reduce their costs…these impacted the company especially hard given its specialism in long haul tailor made holidays,” the report said.
Last year, dnata reported a 64% drop in half year profits to €85 million for the six months to September.
Thomas Cook was one of the major customers for dnata’s travel and catering businesses in the UK and meant it took a hit of almost $23 million from the travel giant’s liquidation on September 23.
Dnata’s travel division also includes Global Travel Group and Imagine Cruising.
A spokesman for dnata said: “While we do not comment in detail on financial matters, and are confident in the overall health of our brands, these results are further evidence of the challenging headwinds that the UK travel sector has faced for several years as a result of industry failures, ongoing economic uncertainty and unstable geopolitical conditions.
“Collectively, Travelbag, Netflights and Travel Republic looked after a million customers in 2019. They stay committed to providing the best possible service to their customers in 2020.”
Travel Republic’s managing director Frank Rejwan resigned from his role earlier this month and is to leave the business in the spring.
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