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Thomas Cook revenues fall after terror attacks slow holiday demand Thomas Cook revenues fall after terror attacks slow holiday demand
(35 minutes later)
Travel company Thomas Cook has slumped to a quarterly loss and will miss annual profit targets after terror attacks in Turkey hit trade. Thomas Cook has slumped to a quarterly loss and will miss annual profit targets after terror attacks in Turkey hit trade.
The group reported a £25m pretax loss on operations in the three months to 30 June, compared with a £3m profit in the same period a year before, after revenues slid 8% to £1.85bn.The group reported a £25m pretax loss on operations in the three months to 30 June, compared with a £3m profit in the same period a year before, after revenues slid 8% to £1.85bn.
It now expects an annual profit of £300m compared with previous forecasts of between £310m-£335m. It now expects an annual profit of £300m compared with previous forecasts of between £310m to £335m.
Despite the profits warning, shares in Thomas Cook rose 6.5% to 63.9p as investors appeared relieved that trading was not worse. Despite the warning, shares in Thomas Cook rose 6.5% to 63.9p as investors appeared relieved that trading was not worse.
Peter Fankhauser, chief executive of Thomas Cook, said: “We are operating in a challenging geopolitical environment, with repeated disruption in some of our key source and destination markets. In addition, while Brexit has had no noticeable impact on our bookings so far, it has added to a general sense of uncertainty – for our business and our customers alike.” Peter Fankhauser, chief executive of the travel company, said: “We are operating in a challenging geopolitical environment, with repeated disruption in some of our key source and destination markets. In addition, while Brexit has had no noticeable impact on our bookings so far, it has added to a general sense of uncertainty – for our business and our customers alike.”
Overall bookings slid 5% as a jump in travel to Spain and the US failed to offset a drop in holidays to Turkey, Egypt and Tunisia, all of which have been hit by terror attacks. So far this year bookings to Turkey were down as much as 40% after Thomas Cook cut the number of flights to the country. Overall bookings slid 5% as a jump in travel to Spain and the US failed to offset a drop in holidays to Turkey, Egypt and Tunisia, all of which have been hit by terror attacks. So far this year bookings to Turkey were down by up to 40% after Thomas Cook cut the number of flights to the country.
The numbers reflected a 41% drop in tourists visiting Turkey in June revealed by Ankara’s tourist ministry on Thursday - its worst single monthly drop in tourism on record. The numbers reflected a 41% drop in tourists visiting Turkey in June revealed by Ankara’s tourist ministry on Thursday - its worst-ever single monthly decline.
Thomas Cook also booked £60m less business from Belgium after a bombing at Brussels airport in March disrupted travel and made locals nervous about holidaying abroad.Thomas Cook also booked £60m less business from Belgium after a bombing at Brussels airport in March disrupted travel and made locals nervous about holidaying abroad.
Bookings from the UK were down 1%, but the company said it was focusing on providing package holidays that provided reassurance on costs in the face of fluctuating exchange rates.Bookings from the UK were down 1%, but the company said it was focusing on providing package holidays that provided reassurance on costs in the face of fluctuating exchange rates.
It flagged a strong start to the winter season in the UK, with bookings up by 19% despite Brexit worries. It expects a strong start to the winter season in the UK, with bookings up by 19% despite Brexit worries. Fankhauser said: “Our all-inclusive holidays in particular enable customers to enjoy their holidays without worrying about unexpected costs.”
Fankhauser said: “Our all-inclusive holidays in particular enable customers to enjoy their holidays without worrying about unexpected costs.” Thomas Cook said it expected holidaymakers to switch to Spain, Bulgaria, Greece, Cuba and the US as alternatives to Turkey and Egypt.
Thomas Cook said it expects holidaymakers to switch to Spain, Bulgaria, Greece, Cuba and the US as alternatives to Turkey and Egypt.