30 September 2009

Strong lates market helps Thomas Cook trading

A strong lates market and package holiday sales have helped Thomas CookÃ¢â¬â¢s summer trading, according to its latest trading update issued today.

Ã¢â¬ÅâœWe remain confident that the business will meet the Board's expectations for the current financial year and that we are well placed to achieve them for the 2010 financial year,Ã¢â¬~ said the statement.

Group CEO Manny Fontenla-Novoa added: "Summer trading is finishing in line with expectations underpinned by a strong lates market and the popularity of the package holiday.

Ã¢â¬ÅâœThrough our flexibility we have managed capacity, and supported our pricing and margins.

Ã¢â¬ÅâœWe are encouraged by winter bookings which have improved since August.

Ã¢â¬ÅâœConsumers are still going on their holidays, but the trend towards later bookings continues.

Ã¢â¬ÅâœWe are confident that we can manage capacity and supplier costs through the season as we have done for the summer.Ã¢â¬~

For Summer 09, TC said it has managed to maintain or improve average selling prices despite the impact of swine flu.

It reported departed load factors of 96% for the completed summer months of May to August, in line with last year.

In the UK market, average selling price was up 8%, although cumulative bookings were 10% down. In the last four weeks to September 5, bookings were down 1%.

Cumulative figures to September 19, which include the impact of the collapse of XL on 11 September 2008, show average selling price up 7%, cumulative bookings down 11%, the last four weeks bookings down 14% and planned capacity down 10%.

TC said in Summer 09 the medium-haul destinations of Turkey and Egypt performed particularly well.

For Winter 09/10, TC said it is confident it can manage the continuing trend of later booking and bookings will trend towards capacity levels as the season progresses.

In the UK, average selling price for winter is up 3%, cumulative bookings are down 11% and the last four weeks bookings to September 5 are down 3%.

Figures until 19 September, again taking into account the collapse of XL, see UK average selling price up 4%, cumulative bookings down 13%, the last four weeks bookings down 17%, and planned capacity down 9%.

Looking forward to Summer 2010, the operator said it is 11% sold.

Ã¢â¬ÅâœThe later brochure launch gives us greater flexibility in our early price negotiations with suppliers, underpinning the attractive prices we are able to offer customers,Ã¢â¬~ it said.

Ã¢â¬ÅâœAlthough it is very early in the season, both selling prices and margins are ahead of prior year.

Ã¢â¬ÅâœAt this stage, we are not anticipating further significant capacity cuts in any of our key markets. However, we maintain flexibility to adapt to further changes in demand up until Spring 2010. We believe we can continue to underpin our prices through negotiating costs with suppliers.Ã¢â¬~

By Bev Fearis