n The Beach Group has seen a surge in bookings for five-star and long-haul holidays, boosting its full-year sales by 16%.

Meanwhile, the online travel agency said the value of three-star sales had fallen sharply amid growing concerns about the cost of living in recent months.

The company saw its sales ahead of pre-pandemic levels as the tourism sector experienced a recovery in holidaymakers following the easing of global restrictions.

Group sales rose by a quarter in the six months to September 30 compared with the same period last year.

On The Beach said it invested in its brand, technology and customer proposition throughout the year, including selling premium lounges and express security and improving customer access to a wider range of hotels.

As a result, sales of five-star holiday rooms increased by 83% last year compared to 2019.

This has led to an increase in average booking value of almost a third over the period as customers shell out more money for their travel.

Meanwhile, full-year long-haul sales rose 257% compared to 2019, while business-to-business sales jumped 45%.

Like many other travel companies, On The Beach preferred to compare its latest financial results with the period before the pandemic.

It said that Omicron the option hit its sales hard at the end of 2021 and during the key booking period in January this year, pushing consumer demand well below 2019 levels until restrictions were eased in mid-January.

However, the cost of living crisis has led to a “tightening of trading conditions” in recent months amid “another poor and unpredictable” year, boss Simon Cooper said.

I’m pleased with the band’s performance in another bad and unpredictable year

The rise in the cost of living weighed on the group’s holiday sales, which remained “subdued” in the second half of the financial year.

Sales three-star holidays fell by almost a fifth for the whole year compared to 2019, suggesting that families looking for cheaper holidays have faced a bigger drop in the cost of living than those splashing out on five-star and long-haul trips.

However, On The Beach said it expected pre-tax profit for the year to be in line with market expectations as it confirmed plans to increase its market share and expand in the new year.

Simon Cooper, chief executive of On The Beach, said: “I am delighted with the group’s performance in another challenging and unpredictable year.

“Both the Group’s long-haul segment and five-star holiday sales have seen significant growth this year and we will continue to grow these important revenue streams. I am also confident that we will capture the market share of the group’s core three-star holiday product in FY2023.

“Despite tougher trading conditions at the end of the year, the strength of the group’s balance sheet ensures that we are well placed to make further strategic progress in the 2023 financial year and the board will continue to assess opportunities for growth.”

Actions on The Beach was down about 3% on Tuesday morning.