Shares of Manchester holiday firm On the Beach slumped 15% after it published interim results for the six months to March 31, 2026, showing a loss before tax of £3.2 million on revenue down £7.2 million to £52.2 million which included £700,000 of “exceptional cancellations arising from the Middle East conflict.”
Adjusted profit before tax fell £6.1 million to £2.3 million.
On the Beach also reinstated its annual profit forecast — but at a level below its previous estimate.
According to Reuters data, the Manchester company has forecast adjusted profit before tax of £18 million to £25 million for the year ending September 30, compared with the £39 million to £43 million previously expected.
On current trading, On the Beach said: “Although demand remains more subdued as a result of the conflict in the Middle East, booking activity has stabilised to a more consistent trading pattern since the half year.
“Bookings over the last six weeks since H1 26 are +9% as we approach the key Summer departure months.
“Despite the current geopolitical uncertainty and a challenging consumer environment, the board is reinstating FY guidance and is confident in delivering Adjusted PBT in the range of £18m-25m.
“The significant strategic progress made during the period further underpins OTB’s prospects for the medium term.”
On the Beach Group CEO Shaun Morton said: “We entered the new financial year with strong momentum as our broadened offer continued to attract new and existing customers, delivering TTV growth of 2% and bookings volumes growth of 7%, significantly ahead of the market.
“However, whilst the Group has limited exposure to destinations in the Middle East, the ongoing conflict has impacted consumer demand since 1 March and led the Group to withdraw its guidance, as announced in the AGM Trading Update.
“H2 booking activity has stabilised to a more consistent trading pattern and bookings over the last 6 weeks are up 9% as we approach the key Summer departure months. As a result, we have today reinstated guidance and the Board is confident in delivering FY26 Adjusted PBT in the range of £18m to £25m.
“The team remained focused on executing our strategic priorities in the first half. Our addressable market has rapidly expanded to over 50m passengers, with significant headroom for further growth. We have continued to invest in scalable technology, build brand loyalty and increase our share of the market. We have delivered significant growth in bookings across our expansion areas, with City volumes, such as Krakow and Amsterdam, up 116% and the Republic of Ireland delivered volume growth of 74%.
“On the Beach’s commitment to helping people holiday better continues to resonate with customers and this is underpinned by the Group’s asset light, cash generative model and proprietary technology platform, with no inventory to fill. Experience tells us that consumers value their summer holiday incredibly highly and I am confident that On the Beach is well placed to satisfy this demand and deliver a solid Summer trading performance.”
REACTION:
Victoria Scholar, Head of Investment, interactive investor: “On the Beach reintroduced its guidance having suspended it in March following the outbreak of the Iran war and the uncertain outlook for international travel. However its reinstated outlook was very disappointing with full-year adjusted profit before tax expected to come in between £18 million and £25 million, versus analysts’ expectations for between £38.5 million and £42 million.
“Shares have plunged by around 15% today reflecting the profit slowdown amid weak demand for holiday destinations like Dubai and Egypt because of tensions in the Middle East. Consumers are also booking later, creating uncertainty for the online travel agent.
“To its advantage, On the Beach is an asset light business model without fixed assets like traditional tour operators, shielding it to some extent from some of the inflationary headwinds. However it is far from immune from the geopolitical disruptions and the weakening demand outlook. The company will be hoping for a flurry of late bookings and a strong summer trading performance to offset a challenging start to 2026.
“Shares are down around 38% so far this year and 47% over a one-year period. However analysts remain optimistic with a consensus buy recommendation on the stock.”