First Choice hit by bird flu
Tour operator First Choice today blamed an outbreak of bird flu in Turkey for reducing demand for short-haul breaks this summer.
First Choice said bookings for mainstream holidays were down 7% on last summer after holidaymakers were scared by the spread of the deadly H5N1 strain of bird flu in Turkey, which has killed four people in the country and reached 26 provinces.
Demand was hit hardest in January, but chairman Michael Hodgkinson told shareholders attending its annual general meeting in London that business had improved since then.
Revenues over the past four weeks were in line with 2005 and Sir Michael said higher sales of more lucrative long-haul trips and the decision to raise prices meant First Choice was turning over 3% more money than at the same stage of last year.
First Choice, whose brands include Unijet, Falcon and Sovereign, has cut capacity for the summer by 5% and this had also contributed to lower sales with demand for inclusive tour packages falling at a similar rate.
Despite the increase in fuel costs, Sir Michael said margins from mainstream holidays were in line with expectations and ahead of last year as two-thirds of trips were now sold directly by the company.
“For the remainder of the summer season, we have less holidays to sell than at the same time of last year,” First Choice said.
In addition to mainstream holidays, First Choice also offers specialist breaks to destinations including Thailand and Bangkok as well as activity holidays such as sailing trips and cruises.
Revenues from specialist holidays this summer were down 11% and bookings were 14% lower as holidaymakers decided to wait until later in the year before finalising their trips and First Choice said it had cut capacity to match profitable demand.
However, margins were strong on sales of holidays to Morocco, Greece and Egypt, which are key destinations for the group.
Shares in First Choice were 3% lower today.
