Ebookers, the pan-European online travel agency, has shrugged off the impact of the war in Iraq to record its first ever profit.

The company reported a pre-tax profit before one-off items of �100,000 for the January to March quarter, against a loss of �2.2m for the same period last year.

Turnover and sales were boosted by acquisitions the firm has made over the past year, including the agency Travelbag which was bought for �55m in January this year.

Ebookers added that it had seen a pick-up in sales over the past couple of weeks to places not affected by the Sars virus.

Profit potential

"We have achieved this result despite the impact of the Iraq war which we estimate reduced our Q1 profit by �3m-�4m," said chief financial officer Nigel Addison Smith.

"This highlights the underlying profit potential within our business."

Ebookers said its tough approach to cost control had enabled it to turn in a profit despite the troubles affecting the travel industry.

The company runs many of its IT and administrative operations at an office in India, taking advantage of the country's lower business costs.

It said the integration of the Travelbag business was making "excellent progress" and was on track to deliver cost savings of at least �5m a year.

The combination of the two businesses will lead to about 80 job losses, and the transfer of some Travelbag positions to the office in India.

Pick-up

Turnover during the first three months of the year more than doubled compared with last year to �14.3m.

When the effects of acquisitions are stripped out, turnover still grew by a healthy 42%.

Total sales grew 79% to �109m, and climbed 29% when acquisitions are ignored.

When exceptional items and goodwill are taken into account, the company recorded a pre-tax loss of �4.8m against a deficit of �3.49m last year.

Since the end of the first quarter, Ebookers said trading up until 25 April was still being hit by the effects of the war in Iraq and Sars.

But since that date it said it had seen "extremely encouraging" trading to many destinations not affected by the virus.