24 July 2009

Turnover doubles for youtravel.com

Youtravel.com has more than doubled its UK sales turnover in its second year and claims to be on track for significant profit in its third year.

The accommodation specialist reported that turnover grew from Ã£32 million to Ã£70 million in its second year, to October 2008.

It said it has also seen a substantial improvement in EBITDA, following losses in its first year of operation when incurring start-up costs.

Passenger numbers also doubled to 500,000 in year two.

Group managing director Graham Nichols said: Ã¢â¬ÅâœYoutravel.com reached break-even in only its second year of operation excluding some small one-off costs. This is an impressive feat for a start-up in this industry and particularly in the economic environment of the last 12 months.

Ã¢â¬ÅâœWe have now reached scale and have excellent market share in the UK. Our aim is now to achieve the same in our international markets. This means that we are able to diversify our business and spread the risk which is an important factor in todayÃ¢â¬â¢s climate.

Ã¢â¬ÅâœFor us, the focus as we end our third year and enter our fourth is to concentrate more on profit rather than such rapid growth in the UK.

Ã¢â¬ÅâœWe are, however, expecting to pursue aggressive expansion programmes in our international markets which have higher margins and huge potential.

'We are on-track to make significant profit in our third year ending October 2009 thanks to a more streamlined operation, exclusive product and a buoyant late-booking market this summer.Ã¢â¬~

Barclays Ventures has been the major shareholder in youtravel.com since its launch in October 2006.

Its portfolio director Dimitrios Tzililis said: Ã¢â¬ÅâœWe have been impressed with the company and how it has navigated the market, which has presented challenges for the entire travel industry.

Ã¢â¬ÅâœWe work closely with the board in shaping the future strategy of the business, and we have been impressed by the encouraging signs of booking levels returning to, and overtaking, those of last year from May onwards.Ã¢â¬~

Youtravel.com said sales in June were up 18% on the same month in 2008 and July figures look to be very similar.

It claimed to have seen a series of record sales days in July, reaching more than 30% revenue increases compared with the same point last year.

Nichols attributed this success to support from trade partners.

Ã¢â¬ÅâœMore than 95% of youtravel.comÃ¢â¬â¢s business is transacted through the trade and this shows no sign of changing,Ã¢â¬~ he said.

Ã¢â¬ÅâœThe travel trade is our lifeblood, thereÃ¢â¬â¢s no way we would be where we are now without the strong trade partnerships we have.Ã¢â¬~

By Bev Fearis