First Choice on its way to register ‘double digit’ growth

First Choice on its way to register ‘double digit’ growth

	Published : Thu, 27 Oct 2005 06:05 By : Paula Demarzio Print this Story

First Choice Holidays reported a firm rise in sales of mainstream holidays on Wednesday and announced that it was on its track to achieving earnings growth of more than 10 per cent for the whole year, which is in line with its expectations.

The firm is concentrating on specialist and activity holidays so as to avoid cut-throat competition in the segment of package holidays. Chief Executive Peter Long emphatically said: "The long-haul sector of the market is definitely growing and we want a bigger share of that". Going by the results that strategy seems to be working well.

The company in its statement said that mainstream summer holiday sales rose by 13 percent, and revenues for winter 2005-06 were up by 6 percent, while its activity holidays sales went up by 4%. Among its specialist offerings, winter sales trips to North America rose by 16 per cent, but they were down by 2 per cent to Europe.

Destinations like Morocco, Tunisia and Cyprus were gaining in popularity according to Mr. Long. He added: "There are more people who want a three- or four-hour flight and seven days in the sun to recharge their batteries".

On the flip-side, the sales of short- and medium-haul mainstream trips for this winter went down by 13 and 17 percent respectively. Winter long-haul sales, on the other hand registered an increase of 39 percent. Winter customer volumes are 11 per cent down compared to the previous year.

Online sales were up by 95 percent thanks to its new venture Hotelopia, which sells hotel rooms over the Internet to leisure and business travellers.

First Choice announced that it was still on its way to achieving 5 per cent operating margin target.

For the winter 2005-06 season, First Choice has reduced capacity by 6 per cent for mainstream holidays. It plans similar reductions in capacity in the other sectors too.

First Choice has also revved up its acquisition programme. In the current financial year, it has spent ₤68 million on purchases compared to ₤45 million last year.