Holiday blushes for tour operator

DAVID HELLIER

and JOHN SHEPHERD

Inspirations, the tour operator that only two weeks ago posted record profits of pounds 7.7m, found itself in an embarrassing situation yesterday over a letter written to its Cypriot hoteliers that spells out reasons for payments delays.

The letter, which appears to have been signed by the finance director of the tour operating subsidiary, Steve Keay, explains that payments problems have occurred for several reasons, including an accounting problem.

The letter describes the problems caused by poor trading conditions in the industry, aircraft leasing payments which have to be paid in order to ensure the continued expansion of the company's holiday programme, and disappointing early bookings for 1996.

The letter concludes: "If you are one of the Hoteliers or Apartment owners which has an amount of money outstanding from unpaid invoices we do apologise ... we would ask you to bear with us over the next few months and wish to assure you that everything possible is being done to improve this situation."

The letter continued: "many in the travel industry have described the 1995 trading year as being one of the worst on record. The public's demand for holidays at lower prices and for heavy discounts to incentives bookings hit tour operators' margins and profits."

Paul Jackson, the finance director, said the leaking of the letter "makes me very very angry". "The company has pounds 55m in the bank and made pounds 7.7m in pre-tax profits. These are the facts," he said. He said letter was erroneous and that it should not have been sent at all. He said it was written by a junior member of staff and added of Mr Keay that "I do not believe he saw it".