The group, the UK’s largest OTA, on Tuesday (24 May) revealed it had trimmed its first-half pre-tax loss (six months to 31 March 2022) by two-thirds to £7 million, while group revenue has increased to £52.9 million compared with just £4.4 million a year ago as sales rebound.
Booked sales growth for the half is up 6% compared with H1 2019, despite the effects of the Omicron variant of Covid-19 and the government-imposed travel restrictions imposed as a result. Growth, said the group, is based exclusively on new cash bookings rather than redemption of vouchers or refund credit notes.
On the Beach said that while Omicron "heavily impacted" group sales in November and December 2021, and early January 2022, they returned to H1 2019 levels in a matter of days by mid-January. Prior to the arrival of Omicron, the group’s booked sales in September and October 2021 were running ahead of H1 2019 levels.
As of 22 May, On the Beach’s sales for the summer were 22% ahead of pre-Covid levels, while early second-half sales (six months to 30 September 2022) in the eight weeks to 22 May were 33% ahead of where they were during the same period in its last full-year before the pandemic.
The group said its outlook would remain cautious with near-term visibility limited, with chief executive Simon Cooper warning the industry was "yet to see the full impact of the escalating costs of living on bookings".
Despite this, On the Beach said it was "excited" about the progress it has made attracting more "premium" customers, a segment it said had recovered "more quickly than the value end", and also the prospect of strong late sales for Spain following the recent relaxation of its Covid travel rules for UK arrivals.
As of 31 March 2022, the group had cash of £16.8 million and ring-fenced deposits of £99 million, as well as access to a currently undrawn £75 million credit facility.
‘Near-term outlook limited’
Cooper said that while "a set of unique trading dynamics" had impacted H1, the trading environment had eased sufficiently to herald "a significant uplift in traffic and booking volumes".
He highlighted, in particular, the group’s proactive efforts to target and capture market share in the premium, long-haul and B2B segments, including "previously unavailable premium hotel stock".
"While we have entered the second half with resilient sales, visibility of the near-term outlook for the UK outbound travel industry remains limited," he cautioned. "Customers are typically booking holidays with shorter lead times and we believe we are yet to see the full impact of the escalating costs of living on bookings.
"Despite this, we remain confident that we have taken the right actions throughout the pandemic, and we will continue to support our customers and staff as a priority. Our investments in brand and proposition will ensure profitable trading into the second half and has left us in a strong position to continue growing market share.”
