Yahoo Finance On the Beach: Spread of Omicron has impacted demand for holiday bookings
On the Beach has become the latest travel firm to reveal a hit to bookings demand due to the spread of Omicron and new testing rules.
The holiday group’s chief executive, Simon Cooper, told the PA news agency he had seen a “big tail-off” in terms of bookings and online searches for holidays since the new coronavirus variant emerged.
It comes after Tui and easyJet recently reported a slowdown in bookings for holidays due to concerns over the spread of the virus.
Holidaymakers have also been hit by soaring costs and uncertainty of Covid-19 tests after new restrictions came into force last week ruling that all travellers returning to the UK must take a PCR test and self-isolate until they receive a negative result.
Mr Cooper said: “Since Omicron hit, we have seen a big tail-off in terms of booking appetite and search appetite.
“The key thing will be how does Omicron unfold in terms of domestic and travel restrictions.”
He said the group had seen “a weight” of forward cancellations in recent days.
But he added: “We are prepared, no matter what.”
The group previously offered free testing for customers, but has withdrawn this in light of the new restrictions in the UK, with different requirements also in place in some countries across Europe.
Mr Cooper said: “There’s no doubt that tests dampen people’s appetite to travel.
“It adds extra cost and jeopardy.”
The comments come as On the Beach swung to an underlying pre-tax loss of £18.4 million for the year to September 30, against profits of £600,000 the previous year.
Its revenues more than halved on an underlying basis to £30.5 million from £71.2 million the year before due to ongoing travel restrictions and the decision in May to suspend new bookings for holidays departing before September 1.
On a statutory basis, it narrowed pre-tax losses to £36.7 million from £46.3 million previously.
Shares fell more than 2% after the figures.
On the Beach raised £26 million in July to help it weather the impact of the pandemic on travel.
Rivals Tui and easyJet have said they expect holiday demand to recover to pre-pandemic levels next summer, but On the Beach held off from giving its prediction of a return to normal trading.
Mr Cooper said: “The return will come, but probably not until Omicron is out of the way.”
The firm has also suspended its guidance for the year ahead “until such time that the overall impact of Covid-19 on the group becomes clearer”.
