MyTravel to make first pre-tax profit in five years
MyTravel is expected to report a pre-tax profit of £40-45 million – its first since 2001.
But in a trading statement today, the group admitted its UK operation would incur a £10-£15 million operating loss for the year to October 31 although the deficit would be cut from last year’s £27.4 million.
The UK businesses, which include Airtours, continue to show improvement “despite a difficult trading environment,” MyTravel said.
The company plans to cut UK capacity for next summer by 3-5%, having sold only 20% so far. MyTravel said it was planning capacity “conservatively”.
The group said attempts to achieve a targeted operating margin of 3.5% in the UK “will depend on there being a more typical trading environment for the summer of 2007.”
The statement added: “However, while overall trading has improved in recent weeks, it has still not fully receovered from the events of this summer, and if these conditions persist there could be a delay beyond 2006-07 in achieving our UK target.”
MyTravel said UK winter trading “remains challenging” with charter holiday bookings down by 9.5% on 10% less capacity. Bookings in the last month are down 2% year-on-year. The company has sold 43% of its UK winter capacity, in line with last year, with average selling prices up by 3%.
The Northern Europe market is “more encouraging” with bookings down 5.5% on 8% less capacity, while in North America bookings are up 3% on a capacity rise of 4%.
MyTravel’s annual results will be annouced on December 14.
Report by Phil Davies
Phil Davies
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