On the Beach Shares Fall as Middle East Conflict Disrupts Bookings

On the Beach, the online travel agency, has suspended its annual profit guidance due to the ongoing war in the Middle East, which has significantly impacted travel to popular Mediterranean destinations. Following this announcement, shares in the Manchester-based firm plummeted by over 11 per cent in early trading, primarily driven by a notable slowdown in demand for locations such as Turkey, Greece, Cyprus, and Egypt.

The company has temporarily paused its profit forecast of between £39 million and £43 million for the full year, citing uncertainty surrounding the conflict’s duration and its effects on future demand in these regions. Airlines, cruise providers, and travel agents have faced some of the most substantial repercussions from the crisis in Iran, disrupting flights and holiday plans and causing volatility in oil prices.

Despite these challenges, On the Beach maintains a profitable trading position amid this volatile environment. The firm has reiterated its medium-term goals, targeting a total transaction value of £2.5 billion, £100 million in earnings before interest, taxation, depreciation, and amortisation, and £85 million in profit before taxation.

Shaun Morton, the chief executive, indicated that operational teams are diligently working to assist affected customers and facilitate prompt returns to their homes. The company remains confident that its strategy of expanding into new markets, supported by an asset-light operating model that does not involve committed inventory, positions it competitively.

Analysts at RBC have noted that the group was performing in line with annual guidance before the onset of the conflict, suggesting a positive sentiment within the sector. They mentioned that the company is effectively managing its operations, experiencing growth in last-minute bookings, diversifying into city destinations, and preparing to expand into cruise services.

Booking figures for the 2026 financial year reflect a 10 per cent increase, with travel volumes rising by 14 per cent in the first quarter. On the Beach has also benefitted from a swift expansion into city packages since 2024, now offering bookings for over 180 city destinations, with volumes more than doubling year on year.