TRAVEL group Minoan last year made a £2.5 million pre-tax loss ahead of the sale of its travel and leisure business.

The group, which is selling the division to fully focus on developing a luxury resort in Crete, saw transactional value increase by 18% to £80m as operating profit more than doubled to £563,000.

Last month Minoan said it had signed an exclusivity agreement with the preferred buyer and also reported it had been approached about selling a “significant” stake in its Crete development.

Chairman Christopher Egleton said that in spite of “continuing growth” in the division, “the results cannot give a good guide to the group’s prospects for the coming period, which I and my colleagues believe will begin to repay the faith shown by all stakeholders in the future and value of the [Crete] project”.

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Mr Egleton acknowledged that with the sale of the only revenue-generating part of its business, Minoan will become “dependent on the support of its shareholders and other stakeholders” until such times as income from the Crete project is forthcoming.

The project, which was given unconditional approval during the financial year, will see a luxury resort built on the Greek island. The company was initially given approval on the site in 2007 but has faced numerous challenges before being given the final green light in June 2017.

The sale of the travel and leisure business, which includes the likes of Stewart Travel and Morningside Travel, was, said Mr Egleton, not taken lightly.

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“The two main drivers of this decision have been the fact that we were unable to expand the business as fast as we had intended for fear of diluting the group’s capital unnecessarily and... the need to concentrate our efforts on creating value without a significant debt overhang with its concomitant costs.”

The group expects the sale to leave it debt free. Shares closed down 6.2% at 6.05p.