On the Beach makes loss, revenue falls 66%, CFO leaves

Manchester-based online holiday retailer On the Beach Group plc (OTB) said on Tuesday it made a pretax loss of £34.1 million for the six months ended March 31 compared with a profit of £11.9 million pounds a year ago “due to COVID-19 related cancellations and a significant reduction in demand.”

On The Beach said its revenues fell 66% to £21.4 million for the period.

On an adjusted basis, revenue fell 17% to £52.8 million and pre-tax profit fell 85% to £2.3 million.

“Total exceptional costs in the period of £34.7m represents the estimated cost of COVID-19 to trading in H1,” said On The Beach.

On its current trading and outlook, On The Beach said: “Most airlines are seeking to resume flying, albeit at a significantly reduced level, in July 2020, in line with the partial reopening of resorts for overseas visitors.

“Whilst a significant number of bookings have been or will be cancelled, we do expect that some holidays booked to travel from 1 July to 31 October will go ahead as planned …

“In light of the continued market uncertainties, the group is maintaining its suspension of full year guidance until such time that the overall impact of COVID-19 on the group becomes clearer.”

OTB said chief financial officer Paul Meehan will step down on July 17, 2020, “to pursue other business interests” and be succeeded by Shaun Morton, the group’s director of finance.

On the Beach Group CEO Simon Cooper said: “In the aftermath of the Thomas Cook collapse, the group made excellent progress in the first four months of the financial year, driving record levels of brand awareness and achieving sales growth of almost 30% for holidays departing in Summer 2020 …

“The onset of the COVID-19 pandemic led to a rapid slowdown in demand for foreign travel followed by the total closure of airspace across Europe by mid-March.

“Our staff responded brilliantly to ensure that the group delivered the highest possible customer service standards in the most difficult of circumstances.

“On the Beach continues to successfully build a leading position as more consumers discover the ease of use and wide choice of beach holidays across our platforms.

“The flexibility and asset light nature of our business model together with our recently strengthened balance sheet and the actions we have taken since the middle of March means we are well placed to capitalise on the inevitable structural changes in the market post COVID-19.

“As a result, the board continues to look to the future with confidence.”

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