On the Beach Group has exceeded expectations in its results despite “an extraordinary and unprecedented year for the travel industry”.
Chief executive Simon Cooper said the group had traded well for the year ending September 30, 2016, and the board expects underlying profit before tax (PBT) performance to be “marginally ahead of the top end of market expectations”.
He added following the trading update in July, demand for beach holidays has remained high despite terrorist attacks, the collapse of the Low Cost Travel Group and weakened sterling.
Cooper said even where demand for short-haul beach holidays was potentially suppressed, On the Beach remained well placed to meet changing consumer demands.
This meant the company had continued to focus on delivering profitable growth, despite the slower than expected revenue growth in the UK of 12% to £70 million.
In the same period, revenue before marketing costs grew 18% to £36 million, up from £30.4 million in 2015.
The group has also continued to grow market share, with daily unique visitors to site increasing 13% to 61 million compared to 54.4 million the previous year.
Meanwhile in Sweden, where On the Beach launched its first international brand eBeach in January 2015, the saw a 52% increase in daily unique visitors to the site to 2.3 million while cost per unique visitor reduced by 18%. Branded visits increased by 113% to 445,000 visits or 20% of total traffic.
This has encouraged the group to launch its second international site in Norway this calendar year.
Cooper said: “FY16 has been an extraordinary and unprecedented year for the travel industry.
“Amidst these difficult conditions, the group’s solid revenue and profit performance is testament to the strength and flexibility of our agile business model and this has enabled us to deliver a year of highly profitable growth.
In spite of the challenges faced, the group has continued to grow market share and this has been delivered by executing a simple strategy of optimising our customer proposition to increase conversion and improve margin.
“The successful execution of this strategy provides further evidence of our ability to steal market share from traditional tour operators.”
The group will announce its audited preliminary results on December 6, 2016.