Minoan Group issues profit warning over Brexit
Updated : 14:23
Minoan Group announced an update in its travel business and its Greek project on Friday, with the board saying the group's travel business has been negatively affected by the outcome of the Brexit vote, weakness in sterling and the decline of tourism in Turkey.
The AIM-traded firm said that as a result, profits for the current year will not meet market expectations.
“We reported in the group's interim statement that we were very pleased that our travel business showed a growth in gross profit of circa 19% in the first half of the year, but that we were concerned as to the impact of the Brexit vote,” the board said in a statement.
“In overall terms, the Brexit vote, including the decline of sterling together with the ongoing situation in Turkey where tourism is down by 40%, has had a material effect, in particular in our market for late holidays due to the reduced availability of less expensive product.
“In the past few months the impact on gross profit has been running at approximately £100,000 per month.”
The board said that while the situation will have a significant effect on profitability in the current financial year, it remained encouraged by the trend in forward bookings for 2017 which show a return to a rate of growth ahead of current market indicators at 8%.
With regards to the company’s Greece project, it had reported in its interim statement that the court hearing of the appeals against the issue of the Presidential Decree is scheduled for 16 September.
“This is the first date in the new judicial year following the court's summer recess and our advisors have confirmed that there is no reason to expect a change to this timetable,” the board said.
“The court process is that, following the hearing, the judges meet to determine the merits, or otherwise, of the arguments put forward.”
The board said it is encouraged by the fact that the court has already reviewed the PD on two occasions when it was judged to be lawfully proposed by the unanimous opinion of the Plenum of the Court and, accordingly, is hopeful that a positive decision will be announced quickly.