First Choice’s Pre-Tax Losses Widens to £82.5 Million

First Choice Holidays posted underlying loss before tax of £82.5 million (it peaked £76.5 million in 2006) due to higher financing cost resulting from increased spend on acquisitions in the six months to April 30.

The underlying pre-tax loss was up from £76.5 million to £82.5 million as the interest charge rose from £9.5 million to £16 million. The underlying operating loss fell slightly from £67 million to £66.5 million. Group revenues rose 5.9 percent in the half year to April 30, to £1.02 billion.

There were seven strategic acquisitions in niche specialist segments made in the first half for a maximum consideration of £145.8 million. Specialist sectors underlying operating profit improved to £5.1 million during the same period.

The results come at a stage when as the group moves closer to completing its tie-up with Thomson, part of Germany TUI travels group, which should lead to cost-savings of £100 million. The company, as per the information available, said that it expected margins to fall further in its main package holiday business, hurt by higher fuel costs for its planes and increases in taxes for customers.

The company shared that for Summer 2007 Mainstream Holidays Sector revenues are up three percent, with long-haul revenues and bookings up 26 percent and 21 percent respectively. Specialist Holidays Sector revenues and bookings are ahead of last year by 18 percent and 16 percent respectively, while Activity Holidays Sector revenues are up five percent on a like for like basis.