Deeper in the red at Lastminute

THE helter-skelter expansion of lastminute.com is continuing to erode margins at the online travel agent and gift shop, which reported a further dive into the red over the Christmas quarter.

The internet company said losses widened by nearly 50% to £26m in the three months to the end of December, the first trading quarter of its financial year.

With operational costs outpacing the 80% growth in the value of its transactions, profit margins fell sharply to 15.8% from 17.1% in the same quarter last year.

Attempts to turn the group into a profitable enterprise have involved it closing six offices in the past few weeks, including its site at Farringdon in central London.

Another seven locations, including the company's office at Twickenham, in west London, are to be shut in the coming months with the total loss of about 355 jobs.

The Christmas trading quarter accounts for less than 20% of the group's annual business, and chief executive Brent Hoberman said he did not expect major holiday bookings to pick up until the summer.

'There is more and more independent travel, with customers increasingly confident of booking at the last minute,' he said.