On the Beach shares rocket as firm gears up for record summer
On the Beach is getting itself ready for a record summer season as consumers hold on to their overseas holidays despite feeling the squeeze.
The travel retailer said its Winter bookings were 15 per cent ahead of last year while bookings for next summer were “encouraging” and likely to be the highest yet.
Chief executive Shaun Morton said: “Demand for On the Beach holidays remains strong and, despite the broader consumer environment, booking trends indicate that consumers will continue to protect their holiday.”
“We’re seeing a shortening in lead times with people waiting a bit closer to when they go away to book their holidays,” Morton told City PM.
“That is sometimes a reflection of people feeling a bit cautious or uncertain about how secure their household finances are.
“Customers…are very value-conscious rather than specific about where they want to go. People are comparing what they get for their money at lots of different places.
“If you think of all the reasons people book the holiday they book, price is right up there.”
On The Beach hikes dividend
It comes as On the Beach upped its full-year dividend by a third to 4p after improving its profitability.
The London-listed company posted revenue of £121.4m for the year to end September, a rise of 1.8 per cent, while pre-tax profit was up 7.1 per cent to £27.9m.
Beach holidays were the primary driver of growth, the Manchester-based firm said, adding that four and five-star bookings represented four-fifths of total transaction volume.
On the Beach said it was “confident” it would deliver on its expected pre-tax profit guidance for next year of between £39m and £43m.
On the Beach shares jumped 12.8 per cent to 217p on Tuesday morning. But the stock remains down by 13 per cent since the start of the year.