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Thomas Cook Loses Less in Last Six Months as Online Bookings Grow

May 15, 2014 9:30 am

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Like TUI, the group’s earnings were hurt by unrest in Egypt. But savings in other areas meant it hurt them less.

— Jason Clampet

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Thomas Cook Group Plc, Europe’s second-largest tour operator, narrowed its first-half loss as Chief Executive Officer Harriet Green pushed through cost savings and targeted online bookings.

The loss before interest and taxes was 187 million pounds ($256 million) in the period ended March 31, compared with a loss of 198 million pounds a year earlier, the London-based company said in statement today. Sales retreated 6.6 percent to 3 billion pounds.

Under Green’s turnaround plan, Thomas Cook is refinancing debt to improve margins, closing underperforming stores, cutting costs and selling peripheral assets. Cost savings are 20 million pounds ahead of plan, prompting the tour operator to boost its 2015 efficiency target to 460 million pounds by fiscal year 2015, the executive said today.

A second wave of measures set to be achieved by 2018 will “transform our profitability and generate superior returns for our shareholders,” Green said, adding that unrest in Egypt drove away about 250,000 customers, trimming first-half sales by 131 million pounds.

Early winter bookings for fiscal year 2015 are more than 11 percent higher in the U.K. and average selling prices are up 2 percent, bolstered by more “winter-sun” destinations, Thomas Cook said today.

Online bookings gained almost 39 percent in the first half, with annual web reservations accounting for about 3 billion pounds in revenue. Mobile and tablet bookings stand at about 500,000 pounds a year, Thomas Cook said.

To contact the reporter on this story: Kari Lundgren in London at klundgren2@bloomberg.net. To contact the editors responsible for this story: Benedikt Kammel at bkammel@bloomberg.net 

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