All Leisure group warns of tough winter despite meeting forecast

All Leisure group expects to deliver underlying pre-tax profit of £2.6 million for the year ending October but warned of a tough winter ahead.

The operator, which runs the Swan Hellenic, Voyages of Discovery, Hebridean and Discover Egypt brands, said trading for the year met its revised forecast with increased yields partly offset by higher fuel prices than anticipated.

But the company admitted that winter trading is “extremely difficult” against a backdrop of unprecedented natural disasters, challenging market conditions, reduced customer discretionary spending, persistent low interest rates, increased oil prices, a weak pound, increased Air Passenger Duty and inflation.

In a trading update, All Leisure said: “As already stated, we are currently encountering many challenges as a result of geo-political events, difficult market conditions, inflation and the situation in the eurozone.

“Nevertheless, we continue to be focused on providing the best service possible to our customers and value to shareholders alike.”

Fuel prices have eased slightly from recent highs and the company has covered around one third of its requirements for the coming year.

The company’s ocean cruise capacity will grow by 15% for next summer and it reported that sales are up with load factors and revenues “slightly ahead” of this time last year.

Egypt bookings are down and a limited programme is being operated this winter which is 80% sold through to April 30, 2012.

“As in the past, we have no financial commitment on the ground and have not contracted any aviation capacity for summer 2012,” the company said. “Bearing in mind all the upheavals in Egypt, we are satisfied with current trading and are doing considerably better than our competitors.”

The niche cruise operator revealed that it had extended a lease on Swan Hellenic vessel Minerva for an additional eight years to November 2021.

Minerva is to undergo a three-month refit this winter at a cost of 14 million euros, the majority of which is being paid for by the ship’s owner.

The ship MS Discovery is operating in the Middle East, Asia and Australia this winter but revenues and occupancy are expected to be lower than last year.

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