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(Alliance News) - On the Beach Group PLC on Tuesday swung to a loss for the first half of its financial year, as revenue more than halved due to Covid-19 related cancellations and a significant reduction in demand as the pandemic spread.
Also, the beach holiday retailer announced the appointment of Finance Director Shaun Morton to the board as chief financial officer with effect on July 17. He will be replacing Paul Meehan, who is stepping down after three years in the role since 2017.
Morton has been in his current role for two years since 2018, and during that tenure was responsible for dealing with the failure of Thomas Cook, the acquisition of Classic Collection, and delivery of On the Beach's share placing to raise GBP67 million in May.
"Shaun has a built a strong understanding of the online travel industry since joining the group and I look forward to working with him as we deliver on the group's strategy to become Europe's leading online retailer of beach holidays," said Chief Executive Simon Cooper.
For the six months to the end of March, On the Beach reported a pretax loss of GBP34.1 million, a substantial swing from a profit of GBP11.9 million the year before, as exceptional expenses reflected the cost of Covid-19 related cancellations or expected cancellations.
On an adjusted basis, pretax profit fell by 85% to GBP2.3 million from GBP15.7 million the prior year, due to the reduction in consumer demand and increased offline marketing spend.
Revenue for the interim period was down 66% year-on-year to GBP21.4 million from GBP63.5 million, again due to lower demand and booking cancellations.
On the Beach declared no interim dividend for the period, compared to a 1.3 pence per share payout the prior year.
Looking ahead, the holiday firm said that bookings for April were at 10% of normal volumes, while from mid-June there has been a sharp increase in demand for summer departures, albeit from a very low base.
Booking volumes for the summer of 2021 remain low, but are significantly ahead of the prior year. However, for its current financial year On the Beach has suspended guidance until the full effect of Covid-19 is clearer.
"In the aftermath of the Thomas Cook collapse, the group made excellent progress in the first four months of the financial year, driving record levels of brand awareness and achieving sales growth of almost 30% for holidays departing in Summer 2020. We also made significant progress against our strategic objectives in the year with Classic Package Holidays going live in over 2,600 agencies alongside the continued expansion of our long haul offering," Cooper said.
Shares in On the Beach were down 1.2% at 298.50 pence on Tuesday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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