UK: Monarch Positive On 2016 Despite Delayed Bookings

British airline and travel group Monarch expects demand to grow next year, even though customers were delaying decisions on where to go because of security concerns.

Privately-held Monarch said it expected to report annual underlying earnings (EBIT) of more than GBP£40 million (USD$60 million) for the year ended October 31, after a turnaround plan helped it recover from last year's GBP£94 million loss.

Monarch, which competes with the likes of Thomas Cook and TUI, said in a statement that further progress was expected this year, calling the outlook for the winter good. "We do expect 2016 to be better than 2015," chief executive Andrew Swaffield told reporters.

The company's financial recovery comes despite Monarch being forced to cancel flights and packages in Tunisia and Egypt this year after the British government raised concerns over safety in the wake of attacks.

London Luton-based Monarch sells holidays and flights primarily to British holiday-makers travelling to destinations such as Spain, Italy and France. Since being acquired by Greybull Capital in 2014, it has focussed on cutting costs by shedding staff and ending loss-making routes.

Swaffield said the halting of holidays to Egypt's Sharm al-Sheikh resort and the Islamist militant attacks in Paris, both last month, meant customers were booking later, in line with what travel companies usually see after such incidents.

"There's an initial lack of bookings and then people get back to normal, but they don't book as far in advance as they normally do," he said.

That was in line with what other airlines such as easyJet have reported in relation to the attacks.

Monarch said in the absence of Tunisia and Egypt as destinations, its customers were booking flights to places such as the Eilat resort in Israel, adding mainland Spain and the Canary Islands were also popular.

British airlines and travel companies are waiting for the UK government to confirm it is safe to fly to Sharm al-Sheikh again. Monarch has cancelled its programme there until January 6.