The UK’s “downbeat consumer sentiment” combined with a slump in demand for holidays in North Africa hit Kuoni’s sales in the first half of its financial year.
The UK and Benelux markets saw turnover drop by 12% from 270 million Swiss francs to 237 million Swiss francs resulting in an operating loss the same as the first half of 2010 at 2.2 million Swiss francs.
The company said: “The fall in demand for holidays in North Africa, the continuing difficult economic situation and downbeat consumer sentiment, especially in the UK, had a negative impact on results. Despite the decline in turnover, cost savings ensured an operating result on [the] prior-year level.”
The Swiss-based operator reduced overall half year losses as group sales rose by almost 19% to deliver an operating profit of more than 2 billion Swiss francs.
The adjusted operating loss came in at 1.5 million Swiss francs, compared with 1.8 million Swiss francs in the same period last year.
Overall organic group turnover was up by more than 6% to 2.084 billion year on year.
The result came in a period when Kuoni took over Gullivers Travel Associates from Travelport, described by CEO Peter Rothwell as “an important transformational acquisition” for the group whihc gives it an “excellent strategic position in a large and growing market”.
Kuoni reported current tour operating bookings as of August 14 being down by 11%, with UK and Benelux bookings down by 16%.
The group expects year-end turnover in the region of 5 billion Swiss francs and profits to be similar to 2010 levels.