On the Beach reports strong revenue growth
Monarch’s failure has led to significant year on year seat price increases for winter departures, retailer On the Beach Group said today in a trading update for the four months of its financial year to the end of January.
In a statement released ahead of its annual general meeting today, the Group said it had performed well. Although other carriers have added incremental capacity, this is primarily for departures from Easter 2018 onwards, with the effect that summer 2018 seat prices have remained broadly flat year on year, it said.
"These pricing factors, together with a return of customer demand for destinations in the Eastern Mediterranean, are helping to drive strong bookings growth for summer 2018 departures and is more than offsetting any weakness in the market for late winter departures."
On the Beach has grown its UK revenue by 23% in the first four months, due in part to the addition of revenues from Sunshine.co.uk, which it acquired last May for £12 million.
"This has been achieved notwithstanding the reinvestment of a significant proportion of the incremental Sunshine.co.uk revenues into marketing activity," it said.
The international sites in Sweden and Norway have continued to show strong growth year on year, and the group will shortly launch its international proposition, www.ebeach, into its third market, Denmark.
"The Group continues to increase its investment in talent and technology while building its exclusive supply position and growing awareness across all brands. The Board believes the full benefits of these investments and the incremental marketing investment in the Sunshine.co.uk brand will continue to flow through in the remainder of this financial year," it said in a statement.
The Group will report interim results for the six months to the end of March on May 10.
Chief executive Simon Cooper said "The first four months of the new financial year have delivered another solid period of growth for the On the Beach, Sunshine and ebeach brands.
"Our strategy of investing in our brands, talent and technology to drive growth has delivered performance in line with the Board’s expectations, with consumers attracted to our wide range of value for money beach holidays. Our third nationwide television advertising campaign started on Christmas Day and has helped drive this strong performance as our brand awareness continues to grow. The Board remains confident in the Group’s outlook and will continue to evaluate opportunities to enhance its market share position."
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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