Package holiday demand sees revenues at Dart soar

The Yorkshire-based group, which includes Jet2.com, Jet2holidays and logistics business Fowler Welch, said half-year revenues flew to £787.1m.

“It’s the continuing popularity of our package holidays,” Mr Meeson told the Yorkshire Post.

“People with a defined budget want an all-inclusive holiday and know exactly how much they are going to spend.”

He said Jet2holidays will take 800,000 people on holiday this year to the ‘sun spots’ of the Mediterranean and Canary Islands and the leisure cities of Europe.

“As long as we are pleasing people we can be confident in our success,” added Mr Meeson.

Jet2holidays grew customer numbers by 103 per cent to 634,866 in the six months ending September 30, helping revenues rise by 110 per cent to £380.1m.

Mr Meeson said the growth was underpinned by “a relentless focus on providing a great value offering to our Northern-based customers”.

He added that Jet2holidays, which range from budget catering to five-star luxury hotels, are ideally suited to the current difficult economic environment.

The leisure airline, Jet2.com, saw revenues rise by 19 per cent to £463.2m as passengers increased by 13 per cent to 4.1m in the period.

Jet2.com operated 53 aircraft during the summer, up from 44 last year, which focused on serving high-volume leisure destinations from its eight UK bases at Belfast International, Blackpool, East Midlands, Edinburgh, Glasgow, Leeds Bradford, Manchester and Newcastle airports.

Mr Meeson plans to increase capacity next summer by 14 per cent with the introduction of 26 new services, including destinations Fuerteventura, Verona and Vienna.

He warned that the leisure travel operations are becoming increasingly seasonal as they continue to grow and as a result increased losses are to be expected in the second half of the year.

The Fowler Welch business, which serves the food industry supply chain, saw revenues dip 2 per cent to £78.2m after contract losses at the end of the last financial year and unexpected demand from supermarket customers. The group decided to close its European operating base in Holland.

On the outlook for the Leeds-based group, Mr Meeson said: “Whilst the trading performance during the first six months of the year has been satisfactory, our leisure travel operations are becoming increasingly seasonal as we continue to grow the business and winter losses are expected to increase materially.

“Accordingly, with the important winter booking period still to come, the board remains cautiously optimistic in relation to profit growth for the financial year ending March 31, 2014.”

The group hiked its half-year dividend by 11 per cent to 60p.

Chris Thomas, analyst at Arden Partners, said: “Dart’s strategy to grow the holiday business, creating a more integrated holiday and airline business has been very successful and has driven good growth in revenues and profits and, in our view, has increased the quality of earnings of the group.

“In this context, we note the 14 per cent planned increase in capacity by Jet2.com for summer 2014 and, if this follows the pattern of 2013, with the incremental capacity absorbed by Jet2holidays, there would be further significant growth in holiday passengers.”

Wayne Brown, analyst at Cannacord Genuity, said investments in offices in Leeds and Bradford, new people and aircraft will lay the foundations for continued growth at the group.

He added: “Dart is well placed to continue to take market share in its core leisure division placing it in a much stronger position for the long term.”