Shares in On the Beach Group (LSE:OTB) slipped on Tuesday as investors took the opportunity to bank profits, despite a solid set of half-year results that confirmed the holiday group is on track for a record-breaking summer
. The stock has climbed 56% over the past 12 months, so the market reaction looks more like profit-taking than a vote of no confidence.
The numbers themselves were robust. Total transaction value (TTV), a measure of all holiday bookings made, rose 13% to £640.7 million in the six months to March.
Revenue increased 7% to £64.2 million, and profits moved higher across the board. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose 19% to £12 million, with margins improving to 18.7%. Adjusted pre-tax profit rose 23% to £7.6 million, and the interim dividend was raised 11% to 1p.
Shore Capital said the results “confirm encouraging year-to-date trends” and noted that booking momentum is accelerating.
Growth in forward bookings has picked up from 7% in the first quarter to 18% in the third quarter so far. Management said summer 2025 is shaping up to be a record period, underpinned by an expanded product range and new market entries.
That includes 130 short and long-haul city destinations now on offer, up from 70 in February, and a new brand presence in the Republic of Ireland. The company also continues to benefit from its Ryanair partnership, which gave a one-off boost to working capital this period.
Net debt has fallen by £18 million to £29.2 million, even after a £30 million return to shareholders. There’s also £224.2 million of customer cash held in trust, which will unwind as travellers depart over the summer.
Despite the share price wobble, ShoreCap remains upbeat. With the stock trading at around 7 times forecast EBITDA and a price-to-earnings ratio of 13, it argues the valuation still looks undemanding given the group’s growth prospects.
On the Beach might have caught a few rays already, but there could still be plenty of sunshine ahead.
The shares were off 3% at 262.5p