Major Improvement in the Co-operative Travel Financial Performance

The Co-operative Travel has announced an increase in sales of 44 per cent to £216.6 million, as the business continues to improve upon its financial performance.

Since the merger between United Co-operatives and The Co-operative Group (operators of Co-op Travel and Travelcare respectively), the actions taken to turn the business around have started to have a positive impact on profitability, with operating losses narrowing to £4.7m from £6.9m, but with most of the benefits flowing through in to the new financial year.

Savings and cost benefits, annualised in excess of £5 million, have already been implemented.

The business performance has improved with the recruitment of a new executive team that has carried out a full strategic review. In the wake of this a number of strategic decisions were taken, including the establishment of a new head office, which meant the closures of Trafford Plaza (the previous Travelcare head office), 55 loss-making high street branches, and the main Stockport call centre, alongside the decision to integrate the two IT systems.

In the post-Christmas booking period the business recorded double-digit growth for the first time in a number of years, and sales continue to be buoyant, although with the unusual Easter holiday dates the first quarter performance is difficult to quantify.

Managing Director of The Co-operative Travel, Mike Greenacre, said: “As the newly-merged The Co-operative Travel we are starting to reap the benefits of consolidated IT systems and a fundamental review of our tour operating strategy, which is expected to improve our margins.

“We will also be the first division in The Co-operative Group’s family of businesses to complete our re-brand across all branches, at the beginning of May.

“I am delighted with sales to-date in 2008 as we continue to beat our trading budget, and I remain confident that we can achieve our goal of bringing this business to significant profitability by the end of 2008.”