Losses linked to a Greek resort development expected to be "lower" than previous year
Travel and leisure firm Minoan Group is predicting "revenues" in excess of £37 million for the year to October 2011 on the back of "robust" travel business growth.
The Glasgow-headquartered company said operating profits for the year are expected to be in the region of £400,000.
Minoan states the £37 million figure as “revenue” though the figure is in fact the total gross value of holidays sold.
In most recent published audited annual results for the 13-month year to October 31, 2011, the group reported sales and commissions totalling £7.33 million for the 2011 year and a pre-tax loss before exceptional costs of £733,000.
Last August the group raised £1.3 million on the stock market to fund acquisitions and a proposed property development on the Greek island of Crete.
Announcing the cash raising last year, Minoan Group said the war chest would allow it to swell the value of holidays sold from a reported £45 million a year to £100 million, by buying up established travel firms.
Minoan, which is registered with Companies House to a London address, moved its headquarters to Glasgow in 2011 after securing a £500,000 grant from the Scottish Government.
Since 2011, the group has spent more than £3 million buying up Scottish travel firms including Ayrshire-based Stewart Travel, Glasgow’s John Semple Travel and Ayr-based King World Travel.
In a trading update posted today, the group reports “stronger performance” in the travel division, where commissions rose by 20 per cent, which “helped to reduce losses at the group level”.
However, further losses are expected linked to the development of a leisure project in Crete, though the group adds those losses will be “lower than in the previous period”.
Planning for its Crete project was granted fast track status by the Greek Government last September and was officially registered in the Government Gazette in December.
Minoan said a “comprehensive review” of planning and tourism investment undertaken by the Greek Government, “with the aim of liberalising the overall framework to actively encourage such investment in Greece...should have a beneficial effect on the Crete project, if implemented".
Minoan also noted in a market update posted today, the first 50 computerised travel agency kiosks, part of an initial pilot phase, have now been installed across largely market town based sub post offices.
This rollout is from an exclusive agreement with the National Federation of Sub Postmasters announced late last year, to install kiosks across the UK’s network of more than 9,000 sub post offices.
Minoan said further information on this rollout will be included in the chairman’s statement when the AIM-listed group files audited accounts.
Christopher Egleton, chairman of Minoan, said: “The group has had an eventful year with the rapidly-expanding travel business performing well and progress made on the Crete project.
“Our travel buy-and-build strategy is paying off, with the recent acquisitions now integrated and the installation of the first 50 sub post office-based travel kiosks.
“All this has helped to deliver a good set of trading figures from the travel business.
“We are also pleased to see the Crete project’s fast track status officially confirmed in law and we are due to submit our environmental assessment shortly.”
In most recent published audited annual results for the 13-month year to October 31, 2011, the group posted a pre-tax loss of £1.61 million and the previous year had posted a pre-tax loss of £1.26 million.
The group said £842,000 of the loss last year was attributed to acquisitions of travel businesses, with a further £317,000 in exceptional costs linked to the group's re-admission to AIM in October 2011.
Minoan also noted in 2011 accounts, costs relating to its Crete project totalling £19.82 million “have been reallocated to non-current assets as a prior year adjustment”.
The group added: “As a consequence, the value of the project remaining in inventories was £15.65 million (Sept 30 2012 £14.9 million)”.