Press Releases

Travelzest plc, the online travel group offering specialist travel programmes, today reports on trading prior to entering the closed period in respect of its preliminary results for the year ended 31 October 2007.

The Board of Travelzest is pleased with the progress the Group has made during the year and anticipates that trading for the year will be in line with its expectations. The outlook for next year remains positive.

Canadian on-line distribution
At the half year stage we stated that we were very pleased with the excellent performance of our largest business itravel2000, and that its sales were up 17% year-on-year. This trend has continued and we have seen a similar performance in the second half of the year. itravel2000 is well placed going in to the peak Winter selling season having successfully marketed the company through its "Let it Snow" campaign during the Summer.

UK tour operations
On 1 November 2006 Travelzest had four tour operators within the Group; VFB Holidays (a French and river cruise specialist), Best of Morocco, Peng Travel (the leading UK naturist holiday company) and farawayholidays.co.uk (specialist in tours of the Far East). VFB has continued to improve following its record performance last year. Best of Morocco had a particularly strong first half of the year, which is its key selling season and is well positioned for the 2007/2008 Winter season. Peng Travel has also enjoyed strong sales from its very loyal customers during the year and following the introduction of a new website is 11% up for the 2007/2008 Winter season. Lastly, farawayholidays.co.uk, which was launched in August 2006, has had a challenging year as it establishes itself within the on-line Far East and exotic holiday market. A number of steps were taken during the Summer to re-focus the business on four destinations, which has resulted in an increase in sales and margin, and bodes well for an improved performance in 2008.

UK on-line agency distribution
Fair's Fare has had a solid year following its acquisition in June 2006. We are pleased to have recently signed a number of new contracts, which should lead to further growth in 2008. We took the decision to launch flight.co.uk with new technology during the financial year and we have been pleased with this development although a contribution is yet to be achieved. It is our intention to use this technology to provide flights for holiday.co.uk and our UK tour operators. The development of holiday.co.uk has continued throughout 2007 and as such is not yet complete. We believe this will lead to a positive contribution in 2009, following completion of this project in 2008.

Acquisitions
During 2007 we acquired Tapestry Collection, Wow House, Captivating Cuba and JMB Travel. As previously indicated these acquisitions will, overall, negatively impact the year principally due to the seasonality of Captivating Cuba's profits. However, Tapestry Collection will provide a positive contribution and, following the implementation of action plans by Travelzest management, we expect a positive contribution for these businesses in 2008.

Commenting on the outlook, Chris Mottershead, Travelzest's Chief Executive, said:
"Due to the progress made in 2007 I am very pleased that Travelzest has established itself as the prominent on-line specialist travel company. We have seen strong performances from the businesses we acquired in 2006 and combined with the improvements we expect to come from the new websites, holiday.co.uk and flight.co.uk, and the additional profits to be generated by the 2007 acquisitions, we are well positioned for long term sustainable performance and growth."

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