Is Lastminute's revival all it seems?

Jeremy Skidmore12 April 2012

AT long last, there is the prospect of Lastminute.com making some money.

That is the impression given by last week's coverage of the results from the internet retailer run by one-time media darlings Martha Lane Fox and Brent Hoberman.

Lane Fox said: 'Following another year of exceeding expectations, we continue on track to deliver operational profitability in our UK and French businesses in approximately six months.'

Some analysts, unused to hearing dotcom companies associated with profitability, were suitably impressed. But others think the picture is rather less rosy.

Lane Fox's prediction applies only to operating profits, not pre-tax profits, and it covers only two of the nine countries in which Lastminute has a presence. For the whole group, operating profit is unlikely before 2004.

And though Lastminute may break even at operating level in two countries next year, analysts still think it will be reporting pre-tax losses this time next year and the year after that.

Lane Fox said: 'We're the only pan-European player and the potential for growth is enormous. No one else is in more than one market.'

The company believes it has only scratched the surface in Britain. Lane Fox said it had 143,000 new customers in the fourth quarter to September.

But the company remains a bit player when measured against the High Street chains. Lastminute's turnover-in the year to next September is likely to be only £24m.

Internet analyst Michael Steib of Morgan Stanley believes the company has made tremendous progress, but he added: 'I would be surprised if it can become more than a niche player in the UK market.'

Another analyst said: 'The newspapers are full of fantastic packages to stay in hotels and go to the theatre.

'Can lastminute offer better? Perhaps, but whether people think so is another matter. Ask around and everyone has heard of the company - but how many are using it?

'Can it survive? Yes. Will it grow into a great, thriving business?

'That's a completely different question, and only time will tell.'

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