On the Beach Group shares fell on Thursday after the holiday booking site revealed the impact of the war in the Middle East on trading since 1st March.
The firm has temporarily suspended its full-year profit guidance after experiencing a significant slowdown in bookings since the start of March, triggered by the escalation of conflict in the Middle East.
The online travel agent said that while it has limited direct exposure to Middle Eastern destinations, the knock-on effect has been felt across popular holiday spots including Turkey, Greece, Cyprus and Egypt.
With no clarity on when the conflict will end or how quickly demand will recover, the board has pulled its previous guidance of £39m to £43m adjusted pre-tax profit for the year.
The suspension of guidance has overshadowed what was otherwise a strong period in the run-up to the conflict.
In the five months to 28 February, the group reported bookings up 10% year on year, with repeat customer bookings rising 19%. Travelled volumes grew 14% in the first quarter and accelerated to 34% in the second.
The group’s app proved pivotal to the uptick in bookings during the period, with app platform bookings jumping 58% and now accounting for 38% of total bookings.
On the AI front, On the Beach has submitted its app to ChatGPT, opening up a new distribution channel as it positions itself for what it calls an “AI-first world.”
There was also strength in recent initiatives focused on capturing specific holiday-maker behavior. City breaks, launched in late 2024, have more than doubled year-on-year booking volumes, with the group now offering over 180 destinations. Its international expansion into the Republic of Ireland is progressing as planned, with significant growth, while its cruise offering, launched earlier this year, targets what the company sees as a large, resilient, and high-growth market.
The group also flagged that the later booking trend seen across the travel industry last year has become more pronounced this year, with bookings made within 90 days of departure up 28%.
But for all the progress the firm made prior to 1st March, investor focus will be on the war and the potential for key travel destinations to see weaker demand for the foreseeable future.
On The Beach shares were down 13% at the time of writing on Thursday.