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BCN-23
BRITAIN-TRAVEL-EARNINGS-BUSINESS
Thomas Cook launches review of airline division
LONDON, Feb 7, 2019 (BSS/AFP) – British travel firm Thomas Cook on
Thursday launched a review of its airline after posting a worsening quarterly
loss on challenging trade.
The company, which offers package holidays to northern Europeans looking
for summer sunshine, has decided to focus more on hotels.
“We are today announcing a strategic review of our group airline,” said
chief executive Peter Fankhauser in a results statement.
“We are at an early stage in this review process which will consider all
options to enhance value to shareholders and intensify our strategic focus.
“We will provide an update on this process in due course.”
Thomas Cook’s airline business operates a fleet of 103 aircraft, about one
quarter of which serve long-haul destinations.
It has however reduced 2019 capacity in the face of challenging
conditions, as holidaymakers eye economic uncertainty arising from Brexit.
“Brexit is in many customers’ minds,” Fankhauser admitted in a conference
call to reporters.
The group has sought to slash costs after its 2017/2018 performance was
also knocked badly by rising costs and a long period of hot European weather
over the summer — which saw customers put off last-minute holidays abroad.
Underlying operating losses widened to o60 million ($78 million, 68
million euros) in its first quarter, or three months to December 31, compared
with o46 million a year earlier, Thomas Cook also revealed Thursday.
“As expected, the knock-on effect from the prolonged summer heatwave and
high prices in the Canaries have impacted customer demand for winter sun,”
added Fankhauser.
“Where Summer 2018 bookings started very strongly, bookings for Summer
2019 reflect some consumer uncertainty, particularly in the UK.”
Total revenues meanwhile edged one percent higher to o1.656 billion in the
reporting period.
“Thomas Cook Group has undergone significant transformation over the last
five years as we have streamlined our operations and focused on a clear
strategy in both our airline and tour operator businesses,” it added in the
statement.
“However, it is clear that we need greater financial flexibility and
increased resources to accelerate the execution of our strategy of
differentiation: to invest in strengthening our own-brand hotel portfolio;
further digitising our sales channels; and driving greater efficiencies
across the business.”
BSS/AFP/HR/1500