13th Feb 2014 11:00
LONDON (Alliance News) - All Leisure Group PLC Thursday said it expects to report a pretax loss of between GBP13 million and GBP14 million for its last financial year as it books a GBP9.9 million impairment charge for items including the relocation of its head office and a writedown on one of its cruise ships.
The company also moved to boost profitability, saying it will sell its loss-making mv Discovery vessel at the end of the summer, eliminating trading losses that are running at about GBP4 million a year.
All Leisure, a niche cruise and tour operator specialising in the over-55s market, reported a pretax profit of GBP0.8 million in its 2012 financial year.
However, the result for the year to October 31, 2013 will be hit by charges including GBP2.1 million for moving its headquarters to Market Harborough, from Burgess Hill, and closing its Southampton office, and an impairment of about GBP6.7 million for the value of its mv Discovery ship following its annual valuation of the group's fleet.
"The market value of mature cruise ships has reduced significantly in the last twelve months and it has been decided that the loss-making mv Discovery will be disposed of at the end of this summer," it said in a statement.
All Leisure, which has cruise brands including Voyages of Discovery and Swan Hellenic, and tour brands including Travelsphere and Discover Egypt, said underlying trading had been as expected during the last financial year, but it had been hit by costs for cancelled cruises after mv Voyager broke down last summer, as well as the impact of the unrest in Egypt on its Discover Egypt operations. It was also hit by the US government shut-down last autumn as it had to cancel Travelsphere escorted tours to the US after National Parks, hotels and monuments shut down.
It said these factors knocked about GBP0.5 million of its profits and it now expects its underlying trading profit to be broadly similar to the GBP0.9 million in booked in fiscal 2012.
The travel company has also been hit by currency movements, particularly in the second half of its last financial year. It said it will book a non-cash charge of about GBP4.3 million for currency moves and fuel hedging.
The company said Discover Egypt is now trading profitability after it cut overheads.
"Since the year end, trading has been robust and the board is satisfied that the group is trading profitably," it said.
All Leisure Group shares were down 11.5% at 39.39 pence Thursday morning, one of the biggest declines on the AIM market.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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