15 May 2008

Thomas Cook reports 'robust' summer demand

Strong summer trading driven by Ã¢â¬ÅâœrobustÃ¢â¬~ consumer demand has been reported by Thomas Cook Group n the back of reduced winter losses.

Operating losses for the six months to March 31 were trimmedby 28% to 193.6 million euros.

The merged ThomasCook/MyTravel group said it was on track to achieve merger synergies in excess of 200 million euros by 2008/09, despite depreciation of Sterling against Euro of 15%.

"Despite the higher cost of fuel and the translation impact of the weakening Sterling, and assuming no further deterioration in the Sterling:Euro exchange rate, the board remains confident that the business will meet its expectations for the current financial year," a statement said.

Winter 08/09 early trading in the UK and Northern Europe was described as "encouraging".

Group chief executive Manny Fontenla-Novoa said:"I'm delighted with our performance over the winter and we are in a very good position for the summer.

"The rising cost of fuel and translational impact of the fall in Sterling against the Euro have made achievement of our Euro-denominated results more difficult, but I remain confident that we will achieve our goals for this year.

"For the longer term, our strategy is on track, our merger synergies are coming through, and we continue to target 620 million euros of operating profit in 2009/10."

The groupÃ¢â¬â¢s mainstream tour operating businesses were said to be performing well.

"We are particularly pleased with the improvement in the UK, which is attributable partly to cost reductions as a result of the merger and partly to improvements in the operation of the business," the half year results statement said.

UK summer capacity is currently 10% lower and there are 18% fewer holidays to sell than at this time last year, "which should stand us in good stead in the lates market".

"We are particularly encouraged by our much lower level of stock left to sell in short haul and long haul. Average selling prices are currently 3% ahead," Thomas Cook said.

The figures reflect a similarly upbeat forecast earlier this week from rival TUI Travel.

By: Phil Davies