Travelzest pre-tax profits hit £1.4m as restructure continues

AIM-listed Travelzest has increased its pre-tax profits for the six months to the end of April 2010 to £1.4 million, a rise of 142%. 


It told the City that its UK and North American operations “are now operating with a lower cost base and a more efficient structure” following a major restructure over the past eighteen months.


Travelzest added that the next phase of the restructure would see “the launch of new unified online distribution store and call centre in Cheltenham.”


A new marketing and distribution strategy, based around the new improved structure, is also on the agenda.


The business has also broken down its performance in terms of merchant and agency business. Merchant business was formerly known as tour operating while agency was called travel agency. Another change in the financials sees its Canadian businesses now referred to as North America.


Cross-selling between its customer base is a key part of Travelzest’s strategy. From September, all the UK businesses will operate under a single luxury retail brand using the same back-office system, which will allow UK businesses to be sold in North America.


It is also “reviewing the integration of a third-party package product to broaden its winter and summer programmes.”


Current trading appears strong, despite “challenging conditions in the UK”. At April 30, agency operations in the UK and North America were 14% ahead with the merchant business 30% up.


Headline figures from the half to end-April show a total transaction value of £118.7m ( H1 09: £104m) generating revenues for the business of £18.9m (H1 09: £17.4m). This breaks down into £6.1m merchant and £12.8m agency.


 Its underlying operating profit was £3.1m (H1 09: £2.3m) with net debt cut from £11.7m to £7.7m.


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