Greater demand lifts Eurocamp profit to £8.65m

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The Independent Online
Eurocamp, the self-drive camping specialist, is recovering and poised to benefit from the expected sharp increase in holiday traffic stemming from the now fully operational Channel Tunnel.

Profits before tax for the year to October rose from a depressed £6.25m to £8.65m.

Forward bookings for this summer are 10 per cent higher than at the same time last year.

The company made £9.4m in 1991/92, but then suffered from sterling's devaluation and increased competition from the likes of Eurosites, which is owned by Airtours and offers comparable holidays for about £200 less for a fortnight for a family of four.

Eurocamp, which was also affected then by a low take-up of its packages linked to Disneyland near Paris, has increased occupancy levels for its traditional camping holidays and its independent camping business, aimed at those with their own equipment.

Independent campers benefit greatly from the company's buying power on ferry crossings, which cost up to £400 in the high season. A 12-night family holiday in France in the peak August period costs about £650 through Eurocamp, compared with the company'sall-in price for those who use its equipment of about £1,100.

To counter competition, while at the same time maintaining its upmarket image, Eurocamp has cut prices by introducing a "kids-go-for-free" marketing strategy.

Sales of the more profitable mobile-home holidays were, as expected, a big growth area.

In Germany and Switzerland, bookings increased by more than 20 per cent, while the Netherlands and Belgium grew by 10 per cent.

French Country Camping bookings increased by 40 per cent. Eurocamp Independent Booking volumes increased by more than 20 per cent, although there was some reduction in margins because of the previous year's sterling devaluation.

Investors liked the latest results, and the accompanying improvement in the total dividend from 9.75p to 10.5p. The figures were at the top end of analysts' forecasts and also showed a rise in year-end cash balances from £9.1m to £10.4m.

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