On the Beach believes it is well-positioned to ride out the Covid-19 crisis and “prosper when normal market conditions return”, despite reporting a £46.3 million pre-tax loss for the year to September 30.
The results compared to a pre-tax profit of £19.3 million in 2019, with the direct impact of Covid-19 measured at £41.7 million due to cancellations, expected cancellations and administrative expenses.
Despite the results, On the Beach said its liquidity remains strong, with total cash at September 30 standing at £36.5 million, excluding £25.8 million of customer monies held in trust.
The overall cash position had since improved to £51 million at November 30, it added, with monthly cash burn of £2 million if no revenue is received.
The company also said its £75 million revolving credit facility had remained undrawn since an equity placing in May, and said it believed there was “an unprecedented opportunity to significantly increase market share as demand returns” as it continues to evaluate opportunities “to increase scale and deliver value for shareholders”.
It said it had issued total cash refunds of £165 million since March 15, and said it was still awaiting £4 million in refunds from airlines for cancelled flights where it had already paid out to customers.
Simon Cooper, chief executive, said: “There is no doubt that 2020 has significantly impacted the entire global travel industry and that the effects of the pandemic will have lasting impacts on the way the industry conducts business for many years to come.
“I am pleased to have witnessed and experienced the professionalism and resilience of our team members in coping and dealing with the many challenges that Covid-19 has presented and I would like to thank them, on behalf of the board, for all of their hard work for our customers.”
He added: “On the Beach continues to successfully build a leading position as more consumers discover the ease of use and vast choice of beach holidays across our platforms.
“The flexibility and asset light nature of our business model together with our recently strengthened balance sheet and the actions we have taken since the middle of March means we are well placed to capitalise on the inevitable structural changes in the market post Covid-19. As a result, the board continues to look to the future with confidence.”
Full-year guidance for 2021 has been suspended, with a further trading update due at the company’s AGM on February 5, 2021.