Thomas Cook losses deepen
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LONDON, Nov 28 AFP
November 28 2012, 8:58PM
Travel firm Thomas Cook has posted deepening losses, hit by the eurozone crisis, Middle East unrest and high fuel costs, and added it was mulling options for its French and North American units.
Thomas Cook said in a results statement on Wednesday that it suffered a loss after taxation of STG585.9 million ($A904.66 million) in the year to the end of September. That compared with a shortfall of STG520.7 million last time around.
Total revenues fell 3.2 per cent to STG9.5 billion in a "difficult" trading environment, as customers in Europe shunned destinations in the Middle East and North Africa (MENA) area -- particularly in Egypt, Tunisia and Morocco.
The debt-laden company's performance was also hit by high fuel costs of STG100 million, and ongoing restructuring measures that are aimed at turning around the company's fortunes.
However, Europe's second-largest travel company added that the annual losses masked an improvement in the final three months, while bookings for the current winter season were strong.
"The West Europe segment has continued to be affected by the ongoing political unrest in the MENA region and the economic uncertainty caused by the European debt crisis," Thomas Cook said in the earnings release.
"In the MENA region, we have seen some recovery in demand for Tunisia but less than anticipated for Morocco and the important market of Egypt has deteriorated further."
West Europe revenues tumbled by 13.9 per cent after capacity reductions in all markets, especially in France.
North American revenues meanwhile slumped 15.2 per cent, hit by persistent market overcapacity, a very mild Canadian winter and the loss of a key premium hotel contract.
"We saw a continuation of the previously announced poor trading in our French and North American businesses and we are taking steps to minimise cash requirements and considering the best long term options for these businesses.
"The French market is acutely impacted by both domestic economic uncertainty and the political unrest in the MENA region, as the French-speaking destinations of Tunisia and Morocco are very popular with our French customers."