World Travel Holdings plc
Interim Results for the second quarter and six months ended 30 June 2002
World Travel Holdings plc, the AIM listed travel distribution business, today announces its
interim trading
results for the second quarter and six months ended 30 June 2002.
CHAIRMAN'S STATEMENT
Results
I am delighted to be able to report the first quarterly profit achieved by the Group albeit in what
will continue to be
the best quarter of each year. Further considerable progress has been made in the reduction of
the Group's costs and
the simplification of its administrative and technical structure whilst maintaining revenue
and growing margin.
Turnover, represented by commissions and booking fees, has increased slightly in the quarter when
compared to the same
period in 2001 on gross sales which have slightly reduced. This reflects progress made in
improving margins, which
increased to 9.29% in the quarter from 8.8% in Q2 2001, and, given the elimination of all
marketing spend is, I
believe, a very creditable performance.
The profit for the quarter is �0.057m compared with a loss for the same quarter last year of
�1.764m. The first half
year shows a loss of �0.93m compared with a loss of �3.443m in 2001. Because of the alignment of
accounting policies
within the Group, as indicated at the time of our first quarter results, the interim figures for
2001 have been re-
stated.
Because of seasonal variations, the Board expects that the Group will make a modest loss in the
second six months of
the year. The board is hopeful, based on current projections, that 2003 will be profitable as a
whole although the
Group is always expected to be loss making in the last quarter of each year. The Group's cash
position continues to be
tight. The �300,000 loan from Culver Holdings (our 7.35% shareholder) received during the
quarter helped, but the
attitude of banks and credit card processors towards the travel industry continues to be
difficult, although it has
eased somewhat in the US. At the end of the quarter the Group had �0.9m of restricted cash in
its US operations
compared with �1.1m at the end of March, the bulk of which represents the float held by the
credit card companies in
respect of tickets, for many of which the Group had already paid the airline concerned.
The move to a common technology platform continues and will have been completed in respect of UK
operations by the end
of August.
Corporate Activity
There has again been no successful corporate activity in the quarter. A number of opportunities
have been examined but
none has come to fruition. The board continues to seek out opportunities and to review those that
arise and will take
advantage of opportunities to exploit the Group's distribution abilities by adding further travel
products which will
produce revenue without a commensurate increase in cost.
Consumer Distribution
Deckchair, one of the Group's two distinct web-based consumer travel businesses, which is
focused on the UK leisure
market has had a disappointing quarter largely because the technical effort applied to moving to a
common platform led
to a deterioration in performance, and also because of the absence of marketing expenditure. With
its move to the new
platform in mid to late August it is expected that performance from this site will start to improve.
The performance
of flights.com which is aimed at the global discount fares market is improving following the
difficult period as the
site moved to a different Global Distribution Service for the supply of airline data to which
reference was made in the
first quarter's statement.
Trade Distribution
Travac, the Group's US-based net fare distributor with offices in New York and Orlando continues
to progress although
June was significantly quieter than was expected.
Netfaresonline, the Group's Canadian-based net fare distributor has been affected by the
withdrawal of certain Air
Canada business from its service. Management in Canada has been strengthened and other
opportunities to grow the
business are being examined.
Little progress has been made in penetrating the UK market for trade distribution although further
efforts are to be
made with the new technology now becoming available.
Prospects
The Directors believe that the Group is now well on the way towards sustained profitability.
There is enormous
potential for substantially increasing sales through an efficient system with little increase in
cost.
The Board is pleased that its hopes for profitability have been brought to fruition and with
the indications of
profitability for 2003.
For further information please contact:
World Travel Holdings plc 020 7456 1351
John Biles, Chairman
Consolidated Profit and Loss Account
3 months ended 3 months ended 6 6 months
ended
30 June 2002 30 June 2001 months 30 June
2001 Year ended 31
Restated ended
Restated December 2001
30 June
2002
Notes �'000 �'000 �'000
�'000 �'000
Gross travel sales 4 7,765 8,090 14,356
13,781 23,672
Turnover 4 722 712 1,515
1,180 2,097
9.29% 8.80% 10.55%
8.56% 8.86%
Selling and distribution costs 5 (121) (238) (302)
(513) (1,352)
Administration costs 5 (544) (2,238) (1,307)
(4,061) (12,995)
(665) (2,476) (1,609)
(4,574) (14,347)
Operating profit/ (loss) 6 57 (1,764) (94)
(3,394) (12,250)
Loss on disposal of fixed assets - - -
- (296)
Profit/(loss) before interest and
Taxation 57 (1,764) (94)
(3,394) (12,546)
Finance charges (net) - - 1
(49) (70)
Profit/(loss) on ordinary activities
before taxation 57 (1,764) (93)
(3,443) (12,616)
Taxation - - -
- -
Profit/(loss) on ordinary activities
after taxation 57 (1,764) (93)
(3,443) (12,616)
Basic loss per share 7 0.06p (3.09)p (0.11)p
(6.03)p (19.21)p
Consolidated Balance Sheet
30 June 2002 30 June 2001 31 March 2002 31
December 2001
Restated
�'000 �'000 �'000
�'000
Fixed assets
Intangible assets - 8,444 -
-
Tangible assets 433 2,537 484
509
433 10,981 484
509
Current assets
Debtors 1,527 2,425 1,513
2,074
Restricted cash 854 - 1,100
169
Cash at bank and in hand 191 509 279
281
2,572 2,934 2,892
2,524
Creditors: amounts falling due within one year (3,657) (6,120) (4,308)
(3,751)
Net current assets/(liabilities) (1,085) (3,186) (1,416)
(1,227)
Total assets less current liabilities (652) 7,795 (932)
(718)
Creditors: amounts falling due after more than one year (1,992) (887) (1,522)
(1,526)
Provisions for liabilities and charges (934) - (1,149)
(1,206)
Net (liabilities)/assets (3,578) 6,908 (3,603)
(3,450)
Capital and reserves
Called up share capital 1,770 663 1,770
1,770
Share premium account 10,140 7,382 10,140
10,140
Shares to be issued 681 6,390 681
681
Capital reserve 4,758 4,800 4,763
5,401
Profit and loss account (20,987) (12,327) (21,017)
(21,502)
Shareholders' funds 3,638 6,908 (3,663)
(3,510)
Minority interest 60 - 60
60
(3,578) 6,908 (3,603)
(3,450)
Consolidated Cashflow Statement
Six months Three months Six months
Year ended
ended ended Ended
31 December
30 June 2002 30 June 2002 30 June
2001
2001
�'000 �'000 �'000
�'000
Net cash outflow from operating activities (38) (113)
(1,329) (3,494)
Returns on investment and servicing of finance
Interest received 5 2 8
7
Interest paid (4) (2)
(57) (77)
1 (0)
(49) (70)
Taxation - - -
-
Capital expenditure and financial investment
Purchase of tangible fixed assets (24) (23)
(70) (247)
Sale of tangible fixed assets 5 5 -
1,400
(19) (18)
(70) 1,153
Acquisitions and disposals
Purchase of subsidiaries undertakings - -
(902) (1,676)
Net cash balances acquired with subsidiary
undertaking - - 237
726
- - 665
(939)
Net cash outflow before financing (56) (131)
(2,118) (3,350)
Financing
Issue of shares (net of costs) - - -
1,755
New long term loans 307 307 -
-
New finance leases 15 15 -
-
Capital element of long term loan payments - -
(7) (897)
Capital element of finance lease payments (5) (3)
(17) (3)
Financing 317 319
(24) 855
Increase/(decrease) in cash in the period 261 188
(2,137) (2,495)
Notes to the financial statements
1. The interim financial statements have been prepared on the basis of accounting policies set
out in the Company's
statutory financial statements. Income from the sale of travel products and services is
recognised at the time
of the booking.
2. The group is engaged in one class of business, the sale of travel products and services.
These activities are
predominantly undertaken in the UK, Canada and the USA
3. The June 2001 figures have been restated due to an alignment of accounting policies at 31
December 2001.
4. Gross travel sales and turnover for the comparative periods are analysed between
continuing and discontinued
operations and acquisitions as follows:
3 months 6 months Year
Ended Ended ended
30-Jun 30-Jun 31-Dec
2001 2001 2001
�'000 �'000 �'000
Gross travel sales
Continuing 2,495 4,153 7,805
Acquisitions 5,595 9,628 15,867
Discontinued - - -
8,090 13,781 23,672
Turnover
Continuing 188 342 555
Acquisitions 524 838 1,542
Discontinued - - -
712 1,180 2,097
5. Costs of selling and distribution and administrative costs for the comparative periods
analysed between
continuing and discontinued operations are as follows:
3 months 6 months Year
ended ended ended
30-Jun 30-Jun 31-Dec
2001 2001 2001
�'000 �'000 �'000
Selling and distribution costs
Continuing 238 483 952
Acquisitions - 30 400
Discontinued - - -
238 513 1,352
Administrative costs
Continuing 1,683 3,153 6,495
Acquisitions 555 908 6,500
Discontinued - - -
2,238 4,061 12,995
6. The operating loss for comparative periods analysed between continuing and
discontinued operations is as
follows:-
3 months 6 months Year
ended ended Ended
30-Jun 30-Jun 31-Dec
2001 2001 2001
�'000 �'000 �'000
Operating loss
Continuing (1,734) (3,285) (6,943)
Acquisitions (30) (109) (5,307)
Discontinued - - -
(1,764) (3,394) (12,250)
7. The calculation of basic earnings per share is based on the loss on ordinary activities
before taxation in the
financial period and the weighted number of ordinary shares of World Travel Holdings plc in
issue as described
in the Company's 2001 statutory accounts.
8. The financial information for the 3 month and the 6 month periods ended 30 June 2002 and 2001
have neither been
audited nor reviewed by the Group's auditors and do not constitute accounts within the
meaning of section 240 of
the Companies Act 1985. The financial information for the year ended 31 December 2001
is abridged from the
Company's 2001 statutory Report and Accounts. The auditors' report on those accounts was
unqualified and did not
contain any statement under section 237 (2) or (3) of the Companies Act 1985. These reports
have been delivered
to the Registrar of Companies and are available from the company's registered office, 53 The
London Fruit & Wool
Exchange, Brushfield Street, London E1 6EX.
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