Bookings surge lifts Thomas Cook profits
Thursday 02 August 2012
Britons looking to escape to the sun after weeks of miserable weather have lifted holiday bookings at beleaguered travel firm Thomas Cook.
The UK's second biggest travel company said its summer programme was now 88% sold after a weather-related boost in recent weeks following a subdued April and May.
But cumulative bookings in the UK were still down 1% on last year as at July 29, although this was unchanged from its last update in May, the 170-year-old firm said.
The group, which was recently forced to turn to its banks for an additional £200 million of loans, reported an underlying operating loss of £26.5 million in the three months to June 30 due to tough trading conditions and the cost of acquisitions.
Thomas Cook said demand for its specialist and independent holidays remained strong but sales of its Olympic and Paralympic packages to corporate customers had been challenging.
The group was plunged into crisis in November after it turned to its lenders for help, sparking fears of a collapse, but it is now hopeful that it has a platform for recovery.
The group recently appointed Harriet Green, the boss of electrocomponents distributor Premier Farnell, to lead its turnaround as its chief executive.
Thomas Cook has so far sold part of its aircraft fleet and five Spanish hotels and agreed the sale of its Indian arm as part of the strategy.
The tour operator has removed 500 underperforming mainstream hotels - around 22% of its properties - from its summer programme.
Ms Green said she hoped to unveil her vision for the business next spring.
She said: "The group has been through a difficult period, but much has been achieved which has strengthened the balance sheet and improved liquidity."
The group reported a 6% drop in revenues for the three months to June 30 to £2.3 billion, while it incurred one-off costs of £33.2 million from reorganisation.
Its underlying challenges remain as net debt rose to £1.1 billion in the quarter from £902.5 million last year, as increased losses weighed on its balance sheet.
The company's disposal programme has generated proceeds of £164.8 million.
Looking ahead, it said booking trends were "encouraging" and the turnaround plan was delivering against its objectives.
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