MyTravel crisis deepens with seventh board departure in a year
Saturday 06 December 2003
Mytravel, THE holiday company formerly known as Airtours, yesterday lost its seventh boardroom member in just over 12 months after the chief executive of its UK and Ireland business resigned abruptly.
Duncan Wilson's decision to quit his £380,000-a-year post casts a fresh spotlight on the troubled tour operator just days before it is expected to report record losses.
Analysts expect the group, which does not have enough cash to survive the winter, to post losses of up to £700m.
The company sealed a £1.3bn financial restructuring in the summer. But it has been forced to sell non-core businesses to raise working capital. Further job losses are likely, the company has said.
A poor summer for its core UK operations, which take 6.6 million British holidaymakers abroad each year, led to its second profit warning of the year last month. This dashed hopes that the new management team had stabilised trading after what had been the worst year in its 30-year history.
Philip Jansen, the chief operating officer, will assume responsibility for turning round the UK and Irish arm, which was left with a glut of holidays to sell off cheaply in September. Mr Wilson will continue to be employed "for a period" to help oversee the handover. He will not receive compensation for leaving the board.
Eric Sanderson, who took over from the group's founder, David Crossland, as chairman last year despite being tainted with the company's past woes, said the parting was by mutual consent.
"Having begun the process of restructuring the UK charter and distribution business, Duncan feels his current role has come to a natural conclusion and the board accepts that it is the appropriate time for him to move on," he said.
Peter McHugh, the chief executive, added: "Philip Jansen has a pivotal role to play in the turnaround and it is appropriate that he should have hands-on control of the core UK business."
The group, which wrecked its interim figures with a goodwill write off of £284m, said last month that the poor summer meant it would have to write down its assets for the second time this year.
Nigel Parson, an analyst at Williams de Broe, predicts the company will make losses of £312m for the year to 30 September on a continuing basis, and £664m on a reported basis, including the write-offs.
MyTravel's troubles date back to the discovery of a £50m hole in its accounts early last year. This prompted the departure of Mr Crossland, Tim Byrne, the chief executive, David Jardine, the finance director, Richard Carrick, the global development director, Mike Lee, the aviation director, and Kazia Kantor, who replaced Mr Jardine.
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