Thomas Cook hit by slump in holidays to Turkey

https://www.theguardian.com/business/2016/sep/27/thomas-cook-hit-by-slump-in-holidays-to-turkey

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Thomas Cook’s summer bookings fell 4% as the travel operator was hit by a slump in demand for holidays in Turkey following a series of terrorist attacks and an attempted coup.

In a trading update, Thomas Cook said summer bookings excluding Turkey rose 4% but that a 40% drop in trips to Turkey caused total bookings to fall. Bookings fell heavily in continental Europe, where German tourists shunned Turkey, but rose 1% in the UK.

Thomas Cook has been hit hard since summer 2015 by terrorist attacks in Tunisia, Egypt and Turkey. It offered customers with bookings to Turkey free cancellation after a failed military coup in July. Bookings from Belgium also fell following the terrorist attacks on Brussels in March.

The company warned later in July that it had slumped to a quarterly loss and would miss its annual profit target.

Peter Fankhauser, Thomas Cook’s chief executive, has said the travel industry is suffering the greatest turmoil he can recall in his 30 years in the business as terrorist attacks and other incidents knock confidence.

Thomas Cook shares rose 4% to 73p as the group stuck by reduced guidance for an operating profit of £300m for the year ending on 30 September – down from £310m a year earlier. Group bookings were in line with expectations as customers switched from Turkey to the Balearic and Canary islands, the US and other destinations such as Bulgaria and Cuba.

Fankhauser said: “The summer season has progressed largely as expected. Customers’ desire to go abroad on holiday has remained strong with the exception of Turkey where demand continues to be volatile. To date, sales for the winter season are in line with last year while sales so far for summer 2017 suggest customers are booking early in an effort to secure their first-choice destination and hotel.”

Demand for holidays among UK consumers appeared undimmed by uncertainty following the vote for Brexit on 23 June. Excluding Turkey, UK summer bookings rose 13% making Britain Thomas Cooks’ strongest region. Fankhauser said the winter season had started well in the UK with bookings up 8%.