Shares of On The Beach Group PLC (LSE:OTB) dropped 14.6% after the online travel company projected full-year profit below analyst expectations, despite posting strong growth in its core operations.
The company now anticipates adjusted profit before tax for the year ending 30 September 2025, excluding its B2B operations, to be between £34.5 million and £35.5 million. This falls short of the £38.4 million forecast by analysts. The guidance reflects plans to wind down the loss-making B2B division, Classic Collection.
Even with the profit shortfall, On The Beach reported a third consecutive year of record growth, with total transaction value (TTV) hitting £1.23 billion—up 11% year-on-year. Summer 2025 bookings rose 12% compared to last year, which the company described as “significantly ahead of the package holiday market” that grew only 3%, according to ATOL data.
“I am pleased to report another year of significant growth with record TTV of £1.23bn, representing a 11% increase on FY24. Our core B2C business has again outperformed the market, underpinned by the Group’s asset light, cash generative model and balance sheet strength,” said Shaun Morton, Chief Executive of On the Beach.
The company also highlighted operational efficiencies, projecting an EBITDA margin of roughly 34%, up from 31.7% the previous year. Customer satisfaction improved as well, with Net Promoter Score rising 17% to around 55.
RBC analysts noted that the lower-than-expected PBT will likely be a key focus for investors, linking the shortfall to an industry-wide challenge with summer holiday re-bookings.
“We would flag though that the group continues to trade well ahead of the market by c.10% and with the winding down of B2B, the full energy of the group can be put behind its fastest growth areas,” they said in a note.
On The Beach has also unveiled a new £25 million share buyback program, adding to the £30 million already returned to shareholders this fiscal year. The company secured a new four-year credit facility of £120 million, with a £30 million accordion option, replacing its previous facility due to expire in 2027.
Looking ahead, Winter 2025 bookings are reported to be 12% higher than the same period last year, while Summer 2026 bookings reflect the broader market trend of later reservations.
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