MyTravel summer UK bookings down 3.5%

MyTravel UK package holiday bookings for summer 2006 are down 3.5% on a reduced capacity of 2%, the group revealed today.

Meanwhile, Going Places same store sales are up 3% since November 1, 2005.

The group’s UK performance is set against a UK market as a whole showing advance summer package holiday bookings continuing to be down by 7% (according to AC Nielsen TravelTrack February 2006), “essentially unchanged” from the position as at December 15.

In a trading update coinciding with its agm today, the group said it was continuing to make “significant progress” in restoring the business.

“We are targeting an operating profit for all three divisions in 2006 and a margin of 3.5% in the UK in 2007,” the agm statement said.

MyTravel’ s summer bookings for both North America and Northern Europe, while early in the cycle, have “started slowly” and reflect the general trend to later bookings, the group said.

The statement said: “We manage the business for margin and not market share.  The flexibility we have gained through the restructuring and our focus on cost reduction provides a sound foundation for the future. 

“We are continuing to make progress with the turnaround in the UK, where we are carefully managing our capacity, ensuring our products are in line with changing consumer trends, and focusing on cost control.”

For winter, all three divisions are performing in line with the group’s expectations, despite a significant year over year increase in fuel costs which management calculates to be £16 million (27%) as at March 7, MyTravel said.

“Our North American operations continue to be affected by the difficult trading environment, which was exacerbated by the effects of Hurricane Wilma. However, we expect this to be offset on a group basis by the significantly improved performance in the UK and further improved performance in Northern Europe, resulting from cost reduction projects across the group which will materially exceed our expectations for this financial year.”

MyTravel has fuel 71% hedged for the summer and it calculates £10 million of additional costs for summer 2006. 

“Fuel for future seasons is being hedged under the long-term policy of regular buying over a 12-18 month period up to the start of the season as previously disclosed,” the company said.

“Overall, the board continues to be confident that the group will be able to achieve its targets for 2006 and beyond.”

Report by Phil Davies