News

By Paul Nelson

CLUB Med is confident of hitting an operating profit of £70 million by 2005 despite disastrous full-year results.

The French all-inclusive operator blamed the war in Iraq, which had a "very significant" effect on bookings during the critical January to March booking period, the Sars virus and continued political uncertainty for its pre-tax loss of £66.1 million for the 12 months to October.

The loss is £22.6 million worse than 2002’s £43.5 million deficit, although it included a number of one-off costs, including £18.9 million for the restructuring of its Club Med World and Club Med Gym divisions and £10.5 million from the closure of its lower quality villages.

The company is confident of a recovery next year. Reservations are already up 1.7% with improving booking figures to Asia showing the area is recovering following the Bali bomb in October 2002. It aims to make an operating profit of £70 million in the next two to three years.

The operating loss of £4.2 million for 2003 is more than double the £2 million figure of the previous 12 months.