Summer sales surge boosts Lastminute

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The Independent Online

Lastminute.com took a further stride towards shaking off its image as a dot.com has-been yesterday as it revealed that a surge in summer sales meant it would post a profit in its fourth quarter.

Lastminute.com took a further stride towards shaking off its image as a dot.com has-been yesterday as it revealed that a surge in summer sales meant it would post a profit in its fourth quarter.

The online retailer, which sells holidays, theatre tickets and hotel bookings, said it would report a pre-tax profit at the group level for the three months to end of September. Previously it had guided the market to expect it to break even in this quarter. The news sent its shares 10 per cent higher to 89.5p.

However, the profit figures, which analysts estimate will be about £3m, will exclude one-off costs and accounting procedures such as amortisation and goodwill, which would turn the profit into a net loss.

In a trading statement, Lastminute said the value of the products and services it sold in the fourth quarter would rise to £110m, 135 per cent more than a year earlier and 80 per cent more than the previous quarter. While the bulk of this growth is a result of the company's acquisition spree this year, it said 55 per cent was underlying, or organic, growth, with demand in its core markets of the UK and France particularly strong.

Brent Hoberman, the chief executive, said the group had benefited from the trend among customers, which has dogged traditional tour operators, not to book holidays or decide on nights out until the eleventh hour. "The more uncertain the world is, the more people who want to book last minute," he said.

Lastminute, which floated just as the technology bubble burst in March 2000, has spent much of its quoted life struggling to persuade investors that it was more than just a one-minute New Economy wonder. It proved that its business model worked earlier this year when its core operations in the UK and France reached operational profitability.

The group said the fourth quarter had also benefited from its string of recent acquisitions, which included Travelselect.com and the Destination Group in the UK and Travelprice.com in France. Analysts expect acquisitions to play a big part in the group's future growth.

"The consolidation play is one they will be very good at and one that will give a lot of upside in the future," Ian Mitchell, an analyst at Brown Shipley, said.

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