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MyTravel turnaround “well underway” but UK still suffering
MyTravel today predicted a return to profitability next year after reducing half-year winter losses.
But the troubled Airtours parent company admitted that the UK market for this summer continued to be “challenging” with margins still under pressure.
The group saw half-year losses reduced to £199.6 million from a deficit of £617.9 million in the equivalent period 12 months ago.
Operating losses from UK businesses were trimmed to £164.7 million from £242.9 million in the period
MyTravel has been in tailspin since a series of profit warnings which resulted in the exit of of key senior managers, the axing of thousands of staff and the sale of or closure of parts of the empire originally set up by founder David Crossland.
However, the company said today that it “continues to target a significant improvement in 2004 and return to profitability in 2005”.
Chief executive Peter McHugh conceded that UK winter losses were “still too high”.
He said: “We are, however, making progress with restructuring the UK charter and distribution business and are continuing to reduce our fixed cost base, increase our asset utilization and improve our trading performance.”
Mr McHugh described the group’s turnaround as being “well underway”.
But he said: “As previously stated, the UK business was in a worse state than we appreciated and will take longer to turn around than originally expected.
“However, the actions we have taken to date are improving our performance. Although there is still more to be done, we are ahead of schedule on delivering cost savings and believe that they are now likely to exceed the target of £150 million in 2005.”
Report by Phil Davies
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