23 September 2009

Cost control still a focus for Holidaybreak

Cash generation and cost control remain a priority for the Holidaybreak group, which released its pre-closing trading update today.

The education, leisure and activity travel group said it was performing well Ã¢â¬Åâœgiven the current economic environmentÃ¢â¬~, and expects to meet management expectations for the full year, which ends on September 30.

Ã¢â¬ÅâœLater bookings, particularly in the Camping Division, have come through as expected,Ã¢â¬~ said executive chairman John Coleman.

Ã¢â¬ÅâœEducation, our largest division, continues to perform well and we are pleased with our site at Windmill Hill, which opened for business in May.

Ã¢â¬ÅâœIn Hotel Breaks, we are seeing continued signs of an improvement in booking volumes, albeit on lower average transaction values.

Ã¢â¬ÅâœThe previously announced restructuring programme for the Adventure Travel Division is progressing as planned.

Ã¢â¬ÅâœThe Education DivisionÃ¢â¬â¢s visibility for 2009/10 provides a healthy outlook.

Ã¢â¬ÅâœHowever, the global economic environment remains uncertain and we continue to manage the entire business tightly, with a focus on cash generation and cost control.Ã¢â¬~

Education Division sales for 2008/09 are up 11% (7% on a like-for-like basis).

For 2009/10, the division is 62% booked.

PGL outdoor education centres are 87% booked for 2009/10.

Revenue growth for the centres for 2009/10 is currently running at approximately 4%. This has declined from the 6% reported in July as booking confirmations slow over the summer holidays.

Ã¢â¬ÅâœAs teachers return to work and bookings are confirmed, we are seeing growth returning to the levels seen earlier in the year,Ã¢â¬~ said the groupÃ¢â¬â¢s statement.

Hotel Breaks sales for 2008/9 are down 2%, an improvement from the trend previously announced.

Ã¢â¬ÅâœThe division is now in a period of less challenging comparatives,Ã¢â¬~ it said.

Ã¢â¬ÅâœThe businesses continue to benefit from improved supplier offers (lower room rates and train fares) and better availability. Booking volumes are improving, albeit at lower average transaction values.Ã¢â¬~

Adventure Travel Division sales for 2008/09 are up 4%, but 3% down at constant exchange rates as we benefitted from stronger than expected late bookings, particularly in our Dutch business, Djoser.

However for 2009/10 revenues for the division are currently down 20%.

Ã¢â¬ÅâœWe believe trading conditions in the adventure travel market will remain difficult for at least the next 12 months,Ã¢â¬~ it said.

Thanks to strong late bookings, Camping Division sales for 2008/9 are up 2%, but 3% down at constant exchange rates, on 4% lower capacity than last year.

Bookings for 2009/10 are behind 2008/09 comparatives but on low volumes, in line with management expectations.

The group said it continues to find a replacement for its group chief executive Carl Michel who stood down for personal reasons and officially leaves on September 30.

Holidaybreak expects to announce its full year results on November 27.

By Bev Fearis