August's security alert in the UK caused major travel disruption

The firm said that the recent UK travel security alert, and terror incidents in Turkey and Jordan, had "compounded an already difficult summer".

The World Cup also had an impact, and MyTravel now expects annual operating profits of between �55m-�60m, against initial expectations of �75m-�85m.

Shares in MyTravel fell 6.4% to 188 pence by the end of trading.

Turnaround

Despite the problems, MyTravel is still set to post a profit for the first time in five years, with pre-tax profits expected to come in at between �40-�45m against a loss of �17.4m last year.

However, its UK business - which it had pledged to return to profit in 2006 - is still set to remain in the red, with an operating loss of between �10m-�15m expected against a loss of �27.4m last year.

We believe that the UK will return to a more typical trading environment in 2007 Peter McHugh, MyTravel chief executive See MyTravel's share price

MyTravel said the business had been affected by last month's security alert after an alleged plot to blow up flights from the UK to North America was uncovered.

Heightened security measures led to flight cancellations and delays, causing widespread disruption.

MyTravel also said that holiday sales this summer were hit by the World Cup, with many people either staying at home to watch matches on TV or making trips to Germany.

It added that UK winter trading had started "slowly", and was still being affected by security worries.

In response to tough trading in the UK, the company said it would accelerate its cost-cutting programme.

"While we are disappointed that we will not achieve this year's target in the UK, we are taking the actions required to complete the turnaround," said MyTravel chief executive Peter McHugh.