On the Beach Group PLC COVID-19 Update (5437E)

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RNS Number : 5437E

On the Beach Group PLC

28 February 2020

This announcement contains inside information for the purposes of article 7 of the Market Abuse Regulation (EU) No 596/2014

28 February 2020

On the Beach Group plc

("On the Beach" or the "Group")

COVID-19 Update

On the Beach Group plc (LSE: OTB.L), the UK's leading online retailer for beach holidays, today issues a trading update following recent COVID-19 developments.

The Group experienced a small but noticeable reduction in demand for Summer 2020 travel following the early reports of COVID-19 cases in early February. The reduction in demand has accelerated significantly following the increase in COVID-19 cases in Europe, particularly the spread of the virus to Tenerife.

Whilst this reduction in demand has led to a natural reduction in marketing spend, the Board does not now expect the Group to achieve payback in the current financial year on its previously outlined strategic marketing investment.

With the expectation that the spread of the COVID-19 is going to cause significant disruption for a period of time, the Board believes that the Group's Full Year results for the year to 30 September 2020 will be below current market expectations.

On the Beach's asset light business model, low inventory risk and tight cost and cash controls ensure that the Group is resilient in a volatile market environment, enabling it to return to profitable growth when the demand for short haul beach holidays normalises.

For further information:

 
  On the Beach Group plc            via FTI Consulting 
   Simon Cooper, Chief Executive 
   Officer 
   Paul Meehan, Chief Financial 
   Officer 
  FTI Consulting                    Tel: [phone] 
   Alex Beagley 
   Fiona Walker 
   Sam Macpherson 
 

About On the Beach

With over 20% share of online sales in the short haul beach holiday market, we are one of the UK's largest online beach holiday retailers. We have significant opportunities for growth and a long-term mission to become Europe's leading online retailer of beach holidays. By using our innovative technology, low-cost base and strong customer-value proposition to provide a structural challenge to legacy tour operators, we continue our journey to disrupt the online retail of beach holidays. Our model is customer-centric, asset light, profitable and cash generative.

www.onthebeachgroupplc.com

Cautionary statement

This announcement may contain certain forward-looking statements with respect to the financial condition, results, operations and businesses of the Company. Forward looking statements are sometimes, but not always, identified by their use of a date in the future or such words as 'anticipates', 'aims', 'due', 'will', 'could', 'may', 'should', 'expects', 'believes', 'intends', 'plans', 'targets', 'goal' or 'estimates'. These forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements, including factors outside the Company's control. The forward-looking statements reflect the knowledge and information available at the date of preparation of this announcement and will not be updated during the year. Nothing in this announcement should be construed as a profit forecast.

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February 28, 2020 09:15 ET (14:15 GMT)