FERRY operator Red Funnel made a loss of nearly £25million last year and laid off staff as the Covid crisis hit demand.

The Southampton company says tourist interest in the Isle of Wight has recovered since – but that commuter and routine travel remains low.

Red Funnel, which runs car ferries and high-speed catamarans between Southampton and Cowes, made an operating loss of £24.7m, up from an £8.48m loss in 2019.

Turnover fell 42.5 per cent to £32.28m, the company’s accounts reveal.

A redundancy programme saw the business shed the equivalent of more than 38 full time jobs. The high speed Red Jet catamaran was suspended for 72 days.

Chief executive Fran Collins reported: “At the lowest point, volumes dropped to three per cent of prior year levels for private vehicles and two per cent for the high speed service. Freight volumes remained more resilient, dropping to 44 per cent of prior year volumes in April 2020, reflecting the lifeline service that Red Funnel offers to the Isle of Wight.”

The company received a government-backed coronavirus business interruption loan of £5m in December 2020, which it repaid after raising more finance from investors.

The year also saw the business suffer a cyber-attack which put its booking system out of action for four days.

Fran Collins said in a statement: “The impact of Covid has been an enormous challenge for both our business and the wider travel sector, and this is reflected in our 2020 financial statements. Throughout these challenging times we have worked hard to continue lifeline services, making some difficult decisions to ensure our resilience.

“Temporary government support helped to safeguard services, with an emergency funding package and the passing of legislation which temporarily amended UK competition law to enable the three Island ferry operators to work together to maintain key services including transportation of food, medical supplies, and freight throughout the worst of the pandemic.

“Looking forward in a time of recovery for many travel and tourism businesses, we have been delighted to welcome more visitors travelling to the Island, with the rise in popularity of UK staycations. In our 160th year of operating, it is encouraging to see that UK holidays are still very much in demand. However, commuter and routine travel to and from the Island remains low, and we are still seeing greatly reduced levels of demand for the majority of our Red Jet services.”

The year saw the company achieve gender equality on its executive board for the first time with the appointment of Lenna Lakes as operations director, alongside Fran Collins and human resources director Debbie Reed.