CNG Travel Group losses deepen
CNG Travel Group has admitted to a “very difficult and disappointing period” while unveiling a half-year operating loss of $20 million.
The increased loss from $3 million a year ago came despite turnover for the six months to June 30 rising 16% to $31.2 million.
The company, which sold off its loss-making business to consumer division for $2.5 million earlier this week, said discussions were continuing following an an unsolicited approach in July.
CNG said: “Since that time discussions have taken place and are ongoing although there can be no certainty an offer will be forthcoming.”
Chairman Luke Mooney said the period had been “very testing” but the sale of the B2C arm had “eliminated a significant drain on our cash resources.”
The disposal allowed CNG to concentrate on its profitable Tzell corporate travel business in the US which achieved pre-tax profits of $5.1 million against $4.6 million.
CNG also admitted that gross profits from its Travel Lodge Connector – TLC – system “remain modest” despite considerable interest in the technology from the marketplace. The value of hotel bookings made through TLC were more than $26.5 million for August, nearly doubling its growth since the beginning of the year, the company said.
Mooney said: “The six months to June 30 have been a very difficult and disappointing period for CNG and its shareholders. The management changes announced to the end of the period under review have had a positive effect on the group and this, coupled with the recent sale of our loss-making business to consumer division, allow us to look forward with renewed optimism.”
Report by Phil Davies
Phil Davies
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