Rougher waters for All Leisure Group

All Leisure Group, the listed cruise operator that owns the Hebridean Princess, has sunk to a £2 million loss after a year of "unprecedented challenges".

The firm, which operates a number of brands including Hebridean Island Cruises, Swan Hellenic and Discover Egypt, said it had been hit by last spring's Icelandic ash cloud which disrupted transfer flights, the "continued weakness of sterling" and rising fuel costs.

Yesterday's results revealed the firm suffered a pre-tax loss of just over 2m in the year to 31 October, compared with a profit of 2.6m a year earlier. It put the cost of the volcanic ash fall-out at 1.4m.

Turnover, however, jumped from 73.6m to 82.6m during the year and the company stressed it was profitable at a trading level before the impact of currency and fuel hedging costs.

A final dividend of 1.31p per share was declared, up from 1.22p, giving a full-year payout of 1.95p, compared with 1.82p in 2009.

The firm said the 12 per cent rise in turnover was boosted by a full-year contribution from the Hebridean Princess, a converted ferry that offers luxury tours around the Hebrides and ranks as one of the smallest cruise ships afloat. Last summer, the vessel was hired by the Queen for a holiday cruise around the Western Isles.

There was also a maiden contribution from another vessel, Alexander von Humboldt.