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Thomas Cook shares fall as terror fears take toll on key destinations Thomas Cook shares fall as terror fears take toll on key destinations
(35 minutes later)
Thomas Cook shares have tumbled more than 15% after the holiday company warned that bookings had fallen in the wake of terrorist attacks in Tunisia and Brussels.Thomas Cook shares have tumbled more than 15% after the holiday company warned that bookings had fallen in the wake of terrorist attacks in Tunisia and Brussels.
Bookings for summer 2016 are 5% down on last year as demand for holidays to Turkey, Tunisia and Egypt fell sharply. Full-year earnings are now expected to come in at the bottom end of City expectations.Bookings for summer 2016 are 5% down on last year as demand for holidays to Turkey, Tunisia and Egypt fell sharply. Full-year earnings are now expected to come in at the bottom end of City expectations.
Related: Thomas Cook hires strategist for safer tourism foundationRelated: Thomas Cook hires strategist for safer tourism foundation
Peter Fankhauser, Thomas Cook’s chief executive, said demand for other destinations such as Spain and the Canary Islands had risen, but it had not fully compensated for the fall in bookings to Turkey.Peter Fankhauser, Thomas Cook’s chief executive, said demand for other destinations such as Spain and the Canary Islands had risen, but it had not fully compensated for the fall in bookings to Turkey.
“As we look ahead to our busiest period, Thomas Cook is trading well to destinations other than Turkey, with particularly strong bookings to Spain and the USA. However demand for Turkey – our second largest market last year – remains significantly below last year’s levels.”“As we look ahead to our busiest period, Thomas Cook is trading well to destinations other than Turkey, with particularly strong bookings to Spain and the USA. However demand for Turkey – our second largest market last year – remains significantly below last year’s levels.”
Commenting on the inflated prices charged by travel companies during the school holidays, Fankhauser said the UK should learn from Germany and Switzerland.Commenting on the inflated prices charged by travel companies during the school holidays, Fankhauser said the UK should learn from Germany and Switzerland.
“UK authorities should look across the pond to Germany and Switzerland where they agree a staggered start of school holiday dates,” he said. “That relieves some of the pressure. If you had an agreement from local authorities in the UK to spread the dates … that would help us as well; it would help everybody.”“UK authorities should look across the pond to Germany and Switzerland where they agree a staggered start of school holiday dates,” he said. “That relieves some of the pressure. If you had an agreement from local authorities in the UK to spread the dates … that would help us as well; it would help everybody.”
He said Thomas Cook was doing everything it could to offer affordable holidays for families, adding “you have to book early in the cycle” to get the best deals. He said Thomas Cook was doing everything it could to offer affordable holidays for families, adding: “You have to book early in the cycle” to get the best deals.
His comments came after the high court last week ruled in favour of a father who refused to pay a fine for taking his daughter on holiday during the school term.His comments came after the high court last week ruled in favour of a father who refused to pay a fine for taking his daughter on holiday during the school term.
Fankhauser said the attacks in Brussels airport and on the city’s metro system in March had brought its Belgian business “almost to a standstill”.Fankhauser said the attacks in Brussels airport and on the city’s metro system in March had brought its Belgian business “almost to a standstill”.
Following UK foreign office guidance, Thomas Cook stopped flying to Tunisia after the attack in resort of Sousse in June 2015. Following UK Foreign Office guidance, Thomas Cook stopped flying to Tunisia after the attack in the resort of Sousse in June 2015.
It has also stopped flying to Sharm el-Sheikh, which was Britons’ most popular Egyptian resort but is now on the Foreign Office’s list of places to avoid. It has also stopped flying to Sharm el-Sheikh, which was the most popular Egyptian resort with Britons but is now on the Foreign Office’s list of places to avoid.
Excluding Turkey, summer bookings for 2016 were up 6% compared with the same point last year. Group revenue edged higher in the first half of the financial year to 31 March, rising to £2.67bn from £2.66bn a year earlier.Excluding Turkey, summer bookings for 2016 were up 6% compared with the same point last year. Group revenue edged higher in the first half of the financial year to 31 March, rising to £2.67bn from £2.66bn a year earlier.
Thomas Cook said it expected full-year underlying earnings to be between £310m and £335m, at the lower end of analysts’ expectations. Shares in the group were the biggest fallers in the FTSE 250, tumbling to a three-year low of 75p.Thomas Cook said it expected full-year underlying earnings to be between £310m and £335m, at the lower end of analysts’ expectations. Shares in the group were the biggest fallers in the FTSE 250, tumbling to a three-year low of 75p.