Monarch saw annual profits fall by £26 million as it faced the industry’s toughest ever trading conditions.

The independent travel group today revealed projected earnings [EBITDA] of £48 million for the year to October 31 against £74 million in the previous 12 months. 

The performance in a “particularly challenging year” was described as being in line with expectations.

The figures come two months after Monarch secured a £165 million investment from majority shareholder Greybull Capital to confirm its annual relicensing with the Civil Aviation Authority. 

The company confirmed that it is no longer required to Atol protect flight only bookings, in line with all other UK airlines, as a direct result of the investment.

Monarch reported holiday bookings for summer 2017 as being up 40% year-on-year, with flight-only bookings up 10%.

The carrier recently ended all credit card booking fees and starts new flights to Porto, Zagreb and Stockholm in April 2017.

The airline expects to take delivery of the first of 30 fuel efficient Boeing 737 MAX-8s in early 2018 with an option on a further 15. 

The new aircraft will improve passengers’ in-flight experience and “transform” the airline’s cost base by reducing its £130 million annual fuel bill by around a quarter and maintenance costs by 80%.

Group chief executive Andrew Swaffield said: “I am pleased that, in the face of what is arguably the toughest trading environment ever faced by the industry, Monarch has maintained its profitable performance.

“Monarch continues to attract over six million passengers every year due to its unique heritage and excellent customer service.

“The record investment in the business announced in October, enhanced marketing initiatives including our first TV advertising campaign in three years and continuing cost control means Monarch enters 2017 in a strong position.

“The strength of both holiday and flight bookings for Summer 2017 demonstrates that our combination of frequent service to popular destinations, great value fares and top-notch service is proving popular with consumers.”

“The group is well positioned to weather ongoing industry challenges and we look forward to continued growth and the arrival of our new fleet of Boeing 737-MAX8 aircraft from spring 2018.“

Monarch has seen growth in holiday booking to the Canary Islands, mainland Spain and Portugal in the past 12 months, with more customers taking four-star holidays, representing nearly half of summer sales.

City destinations including Barcelona, Venice, Rome and Gibraltar all saw double digit growth driven by greater numbers of younger travellers.

The flexible nature of Monarch’s holiday offering saw a growth in sales of nine to 12-night holidays over the traditional 14-night package.

Swaffield outlined to the BBC the challenges faced by Monarch during the year: “The unique combination of terrorism, the closure of Sharm el-Sheikh, particularly Turkey and the eastern Mediterranean, and then the exchange rate changes, particularly the pound after [the] Brexit [vote] against the euro and the dollar.

“Most airlines buy their fuel and aircraft leases in dollars and pay for ground handling and navigation in euros, so in British airlines’ cases we take a lot of our revenue in pounds, and a lot of our costs in euros or dollars.”