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Thomas Cook widens loss on Brexit-related writedown
LONDON, May 16, 2019 (BSS/AFP) – Thomas Cook widened first-half losses on
a major writedown caused in part by Brexit uncertainty that has delayed
summer holiday bookings, the British tour operator said Thursday.
It posted a net loss of o1.474 billion ($1.893 billion, 1.689 billion
euros) in the six months to March 31, as customers also put off trips abroad
last winter.
The troubled group noted meanwhile that it had received “multiple” bids
for its airline business, amid speculation that it could even face a full
takeover attempt.
Thomas Cook’s share price slumped 15 percent in early London trading.
“The first six months of this year have been characterised by an uncertain
consumer environment across all our markets,” chief executive Peter
Fankhauser said in an earnings statement.
“The prolonged heatwave last summer and high prices in the Canaries
reduced customer demand for winter sun… while there is now little doubt
that the Brexit process has led many UK customers to delay their holiday
plans for this summer.
“Our loss from operations for the period was o1.4 billion … largely
related to the merger with MyTravel in 2007 which we have re-valued in light
of the weak trading environment,” Fankhauser added.
The chief executive added that higher fuel and hotel costs were “creating
further headwinds” to the company’s progress for the remainder of its
financial year ending in September.
Thomas Cook’s loss after tax, following a writedown of o1.1 billion,
compared with a net loss of o254 million in the first half of the company’s
2017/18 financial year, it said.
“Thomas Cook’s latest trading statement makes for grim reading,” noted
Laith Khalaf, senior analyst at Hargreaves Lansdown stockbrokers.
“The one glimmer of good news is that the company has secured o300 million
of fresh funding from lenders, although that’s dependent on the sale of its
airline business.”
Fankhauser on Thursday said Thomas Cook had “received multiple bids,
including for the whole, or parts, of the airline business”.
BSS/AFP/HR/1435