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Monarch denies previous refinancing ‘failed’

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Monarch denies previous refinancing ‘failed’

By Ian Taylor |  Nov 03, 2011 12:30PM GMT

The Monarch Group has denied a £75-million refinancing of its loss-making airline was necessary because a previous financial restructure had failed.

Monarch executive chairman Iain Rawlinson said: “The 2009 refinancing was a success. It allowed the business to return to profitability last year.”

The group announced the £75 million cash injection from its controlling shareholders, the Swiss-based Mantegazza family, on Thursday. The move followed a £45-million refinancing two years ago.

Rawlinson reported a £45 million loss for the year to October 31. But he told Travel Weekly: “What we are looking at here is a response to a long-term re-shaping of the market.

“We made a decision in May this year, when oil prices had been $110 a barrel for several months, that high oil prices were here to stay and we had to reshape the business. That was the priority.

“We spent May to July developing a plan for a changed, higher-price environment and that is what the shareholders have accepted. We are taking the initiative to ensure the business can operate successfully in a changed environment.”

Rawlinson said he did not expect market conditions to improve next year and consumers would have to adjust to paying higher fares.

He said: “It is inevitable the cost of flying is going to rise. Fuel costs have increased on average 25%-30% this year – although I’m not suggesting all that will be passed through to consumers. It is incumbent on all of us in the industry to run our businesses more efficiently.”

Rawlinson conceded: “We made a substantial loss [on the current year]. We are very cautious about 2012. But prospects for recovery in 2013 are better. We expect the market in 2013-14 should show some signs of recovery, based on a hopeful return of consumer confidence.”

He attributed the losses for 2010-11 solely to Monarch Airlines, reporting tour operator Cosmos and the group’s aviation engineering business, Monarch Aircraft Engineering, had been profitable.

Tui Travel set for ‘phenomenal’ technological change

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Tui Travel set for ‘phenomenal’ technological change

07 October 2011

Tui Travel will push through “phenomenal” technological change as it bids to become an online-driven business, chief executive Peter Long told delegates at Abta’s Travel Convention.

Speaking in Palma while interviewing Iberostar boss Miguel Fluxa, Long described the online arena as fascinating, and warned convention attendees to ignore online “at your peril”.

He said: “We have a clear view of what we need to do at Tui and the journey involved. The pace of technological change we are going to see is phenomenal. We want to be an online driven business and have a long way to go.”

Long also talked about the importance of gaining new customers outside its traditional markets:

“Geographical expansion is important to us given the volume of new consumers in emerging markets.”

Fluxa said it was as important as ever for tour operators and hoteliers to work closely together and to avoid online business damaging those relationships.

He revealed that of the growing online business Iberostar gets just 20% is from consumers. The rest is B2B, for example from agents dynamic packaging with low cost flights.

Fluxa also pointed out that passengers on low cost flights are not necessarily low quality clients in terms of spend – many are trying to channel as much money as possible into the quality of accommodation.

And said quality of service would improve as those who work in hotels have realised, more than ever due to difficult economic times, that the guests are the key to their livelihoods.

Cruise market will see ‘modest growth’ in 2012, says PSA

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Cruise market will see ‘modest growth’ in 2012, says PSA

Oct 04, 2011 06:00AM GMT

The growth in the number of British cruise passengers is to slow to just 1% next year, the Passenger Shipping Association has admitted.

This represents a slowdown from a projected increase of 5% this year and almost 6% in 2010.

Figures released at the Travel Convention in Palma show an estimated 1.73 million passengers will take a cruise holiday next year, a rise of just over 1% on this year’s forecast figure of 1.71 million passengers.

PSA director Bill Gibbons attributed the slowdown to fewer new ships entering service in 2012.

“Looking forward, we anticipate modest growth in 2012 as capacity slows following the reduction in the number of new ships being built,” he said.

“However, we remain confident that growth will continue over the coming years as companies introduce new ships including the 3,611 passenger vessel for P&O Cruises, the largest in their fleet, due for introduction in early 2015.

“The great choice of ships now providing cruise holidays from the UK to a wide variety of destinations will lead to more passengers sailing from British ports.”

The figures show that a record number of passengers are expected to depart on cruises from the UK in 2012 at 835,000, against 760,000 this year.

Gibbons added: “Cruising is expected to continue to outperform other areas of the holiday market with travel agents, who account for around 80% of sales, continuing to play an important role.”

The PSA expected seven new ships to enter service in 2012 for companies such as Carnival Cruises Lines, Celebrity Cruises, Costa Cruises, MSC Cruises, Disney Cruise Line and Oceania Cruises.