ONLINE travel group lastminute.com saw its share price tumble after confirming that trading had been challenging during the summer.

The company said underlying earnings for the fourth quarter were likely to be at the lower end of forecasts of between £25m and £30m set out in August. Shares fell by as much as six per cent after yesterday's update.

It also gave details of how it would achieve significant cost savings across its businesses in the next financial year.

Lastminute said total cost savings would be £13m in the next financial year, helping underpin growth in earnings.

Chief executive Brent Hoberman said: "Despite continued challenging trading conditions in the industry during the summer quarter, we are pleased to see organic growth accelerate for the group."

The cost of achieving the savings would be £9m including the previously announced exceptional item of £5m relating to the integration of the newly-acquired Online Travel. The majority of these costs will be listed as exceptional items in the current quarter.

Lastminute said in August that underlying earnings for the full year would be between £26.7m and £31.7m, compared with £15m in the previous year.

The company provides travel and leisure offers directly in 13 European countries and also has three international joint ventures. It employs about 2,400 people.

Lastminute said the cost savings would come from the closure of ten offices across Europe and the loss of 350 jobs.

It gave analysts and investors further details of those plans, confirming that about 60 per cent of the job cuts would be in the UK.

Lastminute has been expanding in recent months, most recently acquiring Online Travel for £54.9m, its biggest deal yet. It intends to make these acquisitions more efficient by consolidating its 25 European offices into 15.

The company said it expected total transactional value to increase to 28 per cent next year, from 26 per cent during the current financial year. Underlying earnings are expected to be £55m in the year to September 30, next year.

By the close of trading, shares in the dotcom survivor had recovered to 134p, down 1p on the day.