Companies: HBR   

As foreshadowed here, Holidaybreak (HBR) has cheered investors with record full-year profits of £27 million on turnover of £219 million, writes James Crux.

Preliminary numbers for fully-listed Holidaybreak showed pre-tax profits increased by 13.7 per cent to £27.1 million in the year to September on turnover 13.6 per cent ahead at £218.7 million. Holidaybreak slashed net debt by £21.8 million to £3.3 million, lifted earnings 11.6 per cent to 42.5p a share and proposes to increase the full year payout 11.1 per cent to 20p a share.

In a tough year for overseas holiday companies, Holidaybreak's core camping business outperformed the mass market air package operators. Described by chief executive officer Richard Atkinson as the 'big profits engine of the group', it increased profits 6.3 per cent to £19 million on sales up 5.3 per cent to £109.2 million.

On the last day of the year, Holidaybreak unveiled the acquisition of major camping competitor 'Eurosites' from struggling MyTravel (MT.) for £29.9 million. The business turns over £27.1 million a year and the deal makes Holidaybreak the only serious player in the tent holidays market.

At 'hotel breaks', sales rose 33.2 per cent to £76.9 million on buoyant UK consumer demand and another rise in on-line internet demand. The one stain on the numbers was the adventure division, where profits fell despite a 5.1 per cent revenue rise to £32.6 million.

The division's 'Explore Worldwide' and 'Regal Diving' businesses were hit by September 11. Customers cancelled holidays, popular destinations became off-limits and the airline sector was thrown into chaos, hitting many tour ventures.

Chairman Angus Crichton-Miller, who will be replaced by former BA chief executive Robert Ayling next June, expects 'further profitable progress in 2003'. Supported by the group's strong cash generation, he says 'longer term prospects remain excellent'.

On Friday, we urged investors to buy at 572.5p. The shares gained 8.5p at 581p today, valuing the leisure-listed business at £271 million.