Holiday company First Choice has reported an eight per cent increase in first-half underlying losses, with the cost of financing the group's recent acquisitions blamed for the rise.
In a statement the travel company revealed that its underlying pre-tax loss for the six months to April 30th totalled £82.5 million – up from £76.5 million a year earlier.
Higher borrowing costs as a result of UK interest rate rises were held responsible for £1 million of the increase.
Nonetheless the British firm saw half-year revenues climb by six percent, with demand for long-haul destinations fuelling the rise.
First Choice said its revenues grew to £1 billion over the six month period, with long-haul revenues up 26 per cent for summer 2007 bookings.
The company subsequently announced plans to increase its interim dividend by 11 per cent to 2.50p per ordinary share.
Chief executive Peter Long delivered an upbeat assessment of the outlook for First Choice, which is to merge with the German travel group TUI.
Amid growing competition from rival Thomas Cook and the declining popularity of package tours the holiday company has also completed seven acquisitions in niche segments of the leisure travel market over the past six months, with the takeovers totalling a maximum consideration of £145.8 million.
Commenting on First Choice's results, Mr Long said: "I am pleased with the first half trading performance in what has been a challenging market, particularly in the UK and of course an exceptionally busy period for the company.
"The recent acquisitions are performing very well and the pipeline remains strong."
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