LONDON: The U.K tour operator First Choice Holidays Plc said Thursday its first half loss rose 8 per cent to 82.5 million pounds, mainly on account of acquisitions it made during the period.
The company acquired seven firms, paying nearly 145.8 million pounds during the first half. The company is now in the process of merging with German firm TUI AG's tourism unit, creating TUI Travel Plc, in which TUI will own 51 per cent and First Choice's shareholders the rest.
The loss did not include 12.9 million pounds spent in order to close down the company's sales outlets in Germany and Belgium, cutting down staff elsewhere and legal charges. When all exceptional items are taken into account, the first half loss would amount to 102.8 million pounds.
The company's sales rose 5.9 per cent to 1.017 billion pounds, compared with 960.7 million pounds in the corresponding period last year.
Chief executive officer Peter Long said he is pleased with the first half performance as the company faced a highly competitive market and it spent on acquisitions. He claimed these strategic moves will yield results. The company may make more acquisitions in the coming months, especially firms focused on adventure travel.
Long said more Britons are traveling to Florida, Mexico and the Caribbean following the fall in dollar value and the company has increased its capacity compared to last year to meet demands in long haul trips.
The company said margins at its Mainstream package holiday business will continue to fall because of increased taxes on holidaymakers and the higher fuel costs, which makes air travel really costly.
Revenue from specialists holiday unit is up 18 per cent compared to last year. Activity holidays revenue has gone up by 5 per cent on a like-for-like basis.
The company also said its online destination services bednight bookings have gone up 32 per cent. It added it is continuing to invest in its long-haul program and in Holiday Villages.
The firm said it will raise its interim dividend by 11 per cent to 2.5 pence per share.
