Publicado: Vie, May 17, 2019
Financiera | Por Marilu Caballero

Thomas Cook announces £1.46bn loss as holiday demand falls

Thomas Cook announces £1.46bn loss as holiday demand falls

Troubled holiday agent Thomas Cook, which is based in Peterborough, has reported a loss of around £1.4 billion for the six months to March 31.

Thomas Cook said the outlook for bookings across Europe was lower than past year.

The first-half results were accompanied by its third profit warning in less than a year, driving the shares down 17% to 18p, close to lows they traded at in 2012 when it was in financial difficulty. It has slashed the number of holidays it offers in response to weaker demand, and is offering big discounts to entice United Kingdom customers.

"The prolonged heatwave last summer and high prices in the Canaries reduced customer demand for winter sun, particularly in the Nordic region, while there is now little doubt that the Brexit process has led many United Kingdom customers to delay their holiday plans for this summer", he added.

"There's no doubt that we have had a decline in consumer confidence during this whole Brexit phase in the run-up to March, but we have seen no material change to booking patterns in recent weeks since the delay to Brexit was announced", he added. "There are a lot of holidays left to sell and there are high levels of discounting".

Fankhauser said consumer demand for the firm's holiday packages had weakened across Europe, with the prolonged heatwave last summer and high prices in the Canary Islands putting people off booking winter and summer breaks overseas.

"As we look ahead to the remainder of the year, it's clear that, notwithstanding our early decision to mitigate our exposure in the "lates" market by reducing capacity, the continued competitive pressure resulting from consumer uncertainty is putting further pressure on margins". It has also confirmed "multiple" bids have been made for all or part of its airline. Don't just book it Thomas Cook it indeed.

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The company has closed 21 of its stores, its currency arm Thomas Cook Money is under review and more "cost efficiencies" are planned.

The debt-laden company has struggled recently, as a fall in demand for package holidays and intense online competition resulted in a string of profit warnings.

Photo Credit: Thomas Cook's office in Palma, Majorca. "Tui is the next weakest in the market in terms of its debt".

Julie Palmer, partner at Begbies Traynor, said that pressure was mounting on Thomas Cook to sell off its airline. The company carried out a rights issue in 2013 to shore up its balance sheet.

Fankhauser said the cornerstone of Thomas Cook's strategy was its directly managed hotels, and was hopeful this would help it get through the tough times. Thomas Cook opened 12 more hotels in the first half, taking the total to 200 hotels, including franchised outlets, and is aiming for 250 by 2021.

He said Cook's Club holidays were popular with millennials (18- to 35-year-olds), who now account for a quarter of bookings. There has been a boom in short city breaks to San Francisco and Las Vegas. In Europe, Spain remains the most popular destination, followed by Turkey and Greece.

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