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Thomas Cook announces first quarter results and strategic review
Posted on Thursday, 07 February 2019 08:59
UK-based travel company Thomas Cook is considering options for its airline operations after its second profit warning for the three months ended 31st December 2018.

The group is looking to raise cash that would help see it through a tough 2018 and a weak demand for holidays in 2019.

According to the first quarter trading statement issued today, Thomas Cook has undergone a significant transformation over the last five years to streamline its operations and focus on a clear path for both the airline and tour operator units.

It is now looking for greater financial flexibility and increased resources to continue to accelerate this strategy, including investing in its own-brand hotel portfolio, digitising sales channels, and driving greater efficiencies across the business.

As such, Thomas Cook has decided to launch a strategic review of its airline operations.

The company cautioned that such plans are at an early stage and all options are being considered to enhance shareholder value and intensify the group’s strategic focus.

Under the airline business, Thomas Cook operates a fleet of 103 aircrafts, of which a quarter serve long-haul destinations.

It has delivered strong growth in 2018, carrying over 20.00 million passengers and generating GBP 3.50 billion in revenue, with underlying operating profits growing 37.0 per cent year-on-year to GBP 129.00 million.

Thomas Cook recorded a 1.0 per cent increase in first quarter revenue to GBP 1.66 billion, while operating loss increased by GBP 14.00 million to GBP 60.00 million in the three months to 31st December 2018.

Peter Fankhauser, chief executive, noted that the company is set to open 20 new own brand hotels this summer, including three Casa Cooks and eight Cook’s Clubs, and have announced two new hotel projects with Fosun in China.

Earlier this week, Thomas Cook announced it had raised EUR 51.00 million from CaixaBank in its second-round of debt funding for its Thomas Cook Hotel Investments joint venture with LMEY Investments.

The travel company’s airline unit launched a website in 2004 to offer seats to independent travellers and has become one of the most recognisable names in the UK.

Zephyr, the M&A database published by Bureau van Dijk, shows there were 277 deals targeting scheduled passenger air transportation groups announced worldwide in 2018.

China Eastern Airlines and Hainan Airlines featured in the top two transactions, with others including Deutsche Lufthansa, Juneyao Airlines, Western Airlines and Volotea.

© Zephus Ltd