Shares digital

After a positive trading update at the AGM, six directors of Holidaybreak (HBR), led by chairman Bob Ayling – formerly of British Airways (BAY) – and chief executive Carl Michel, bought a total of 55,501 shares at 572p. This investment of over £300,000 is the latest show of the board’s optimism. Last month one non-exec, James Greenbury, bought 11,000 shares (Shares 10 January).

The AGM update was certainly encouraging. The education division, which accounts for some 24% of group revenues, is already 78% booked for this year and 19% booked for next year. Underlying sales are currently 10% ahead of last year’s.

Similarly demand for hotel breaks is 8% higher, helped by strong packaged business in London, boosted by exhibitions such as Tutankamun and China warriors and theatre such as Joseph and Dirty Dancing.

Although Adventure travel is currently slightly ahead of last year, the group believes recent events in Kenya will have an adverse impact on the year’s results.

Camping is seeing a modest improvement in demand. As capacity is being reduced this year by 5%, capacity utilisation should improve. This should lead to modestly better margins.

Overall, the market is expecting earnings to grow to 58.3p this year and 64.8p next, placing the shares – at 607p – on a PE of 10.4, falling to 9.4 in 2008/09.

Shares says: Current-year yield of 5.8% and an undemanding rating, the board’s optimism is an encouraging sign.