On the Beach profit up but shares slip as Brexit bites

Stockport-based holiday retailer On the Beach Group plc said on Tuesday its revenue increased 41% to £63.5 million and adjusted profit before tax rose 14% to £15.7 million in the six months to March 31.

But the firm’s shares slipped about 4% as it warned it remains “cautious of the consumer environment until a Brexit resolution is found …”

On the Beach Group CEO Simon Cooper said: “On the Beach has delivered a solid performance in H1, despite continuing uncertainties around Brexit, with modest booking and revenue growth supported by the ongoing benefits of improved marketing efficiency which resulted in a growth in adjusted PBT of 14%. 

“This performance has been delivered against a soft background market, particularly in the important first calendar quarter, when uncertainties regarding Brexit impacted consumer appetite for booking holidays.

“Independent market data shows that a significant proportion of consumers deferred their holiday purchase in the run up to the 29 March deadline and our understanding is that the background market has been trading down 10% YoY in 2019.

“There were a number of exciting operational developments in the first half including the launch of Classic Package Holidays, providing a platform for travel agencies to book mainstream beach holidays; the integration of both Emirates and British Airways onto our platform to expand our long haul offering; and we completed our move to the group’s new Digital HQ in Manchester together with the expansion of our Operational HQ in Cheadle.

“Looking forward, we continue to remain cautious of the consumer environment until a Brexit resolution is found, but the resilient and flexible nature of our business model allows us to focus on profitable growth and gives us confidence in the group’s outlook.

“We will continue to evaluate opportunities to enhance our market share position.”

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