Mark Wray and Nick Cust Joint Managing Directors of the Hotel Breaks Division

hotel breaks Once again Hotel Breaks has proved the outstanding performer in the Group. A turnover increase of 33% combined with a 0.6% margin improvement resulted in profits of £7.8m, a 43% increase. The launch of the European Cities programme, although highly successful, was only a marginal contributor to the overall growth, representing just 3% of turnover. The margin increase was attributable to two factors. Higher gross margin internet and direct business grew particularly strongly and we also achieved economies of scale, servicing substantially greater volumes of business without commensurate increases in overheads.

The year started with a degree of uncer tainty following the September 11th attacks. Demand for London breaks, in particular, was clearly affected during September and October but once consumer confidence returned conditions proved unusually favourable. Overseas visitor numbers, already weak due to sterling strength and foot and mouth, were further reduced because of security concerns. Hotel rooms in all categories in London and other major tourist centres were readily available, often at very attractive rates. Consumers meanwhile were in spending mood, as corroborated by the strong retail sales figures.