A warning about a trend towards late booking across the portfolio of operators that make up the Holidaybreak group was made today in a trading update.
Chief executive Martin Davies made the comments when delivering the education and activity travel group’s interim management statement today.
Commenting on the period between October 1, 2010 and February 12 this year, he said: “Sales intake is currently 3% down compared with last year as we experience a trend towards later bookings in each of our businesses. The group continues to display strong sales visibility with 61% of target group revenue already booked for the year.”
The group is expected to perform “in line with management expectations” for the year ending September 30″, he added. The closure of UK and Dutch airports due to snow in December and the civil unrest in Egypt “negatively impacted” performance in the group’s adventure travel division.
All February departures to the affected areas of Egypt have been cancelled with some customers re-booking to alternative destinations. “Although Egypt accounted for approximately 6% of adventure’s revenue in 2010, it represented 1% of group revenue,” the company said.
Sales of hotel breaks, which accounted for 29% of last year’s group revenue, were 9% down on the same period last year. Performance was adversely affected by the weather conditions in December and also by Superbreak losing airport hotel contracts with large retail travel agents, although this was a low margin product, the company said.
“Excluding these airport hotel contracts, the underlying trend shows sales intake currently at 6% below last year,” Holidaybreak said.
“We continue to focus on London, our key sales market, and packaging competitive hotel, rail and theatre deals. In particular, we expect the Royal Wedding and attractive new shows, including Wizard of Oz and Shrek, to boost demand into London this year. However, given the difficult trading environment, we continue to manage the business tightly with a focus on reducing costs.”
The education & adventure division, which accounted for 48% of 2010 group revenue, has achieved 77% of target bookings for 2011 and 12% for 2012.
“Sales intake for the division is currently level with last year reflecting a slowdown in adventure. We remain confident of delivering our expectations for this division through effective yield management,” the company said.
Sales for the camping division, which accounted for 23% of 2010 group revenue, is 4% down on 3% lower capacity. Around 58% of target sales are booked (compared to 62% last year), reflecting an increasingly late booking market.
“We remain focused on maximising occupancy and yields. Overall, sales are in line with expectations with a strong start from Germany and Ireland offsetting slower trading to date in the UK and the Netherlands,” the company said.
PGL UK outdoor education centres and study tours were described as trading in line with last year with a “noticeable trend” towards later bookings from schools. UK centres are 96% booked for 2010/11.
The acquisition of a half share in German school tours operator Meininger was completed before Christmas Sales for the current financial year are 25% ahead of last year. An additional four sites in Germany and Austria are being targeted which will bring the portfolio to 14.