TUI finance boss quits over £88m hole
TUI Travel’s chief financial officer Paul Bowtell has quit after an £88m hole was discovered in the company’s finances.
A statement issued today said the £88m deficit had been uncovered during the ongoing audit for the year ended September 30.
It was on top of an initial £29m originally identified, bringing the total write-off to £117m.
"These have arisen as a result of failures to reconcile balances adequately in legacy systems in the retail and tour operator businesses in TUI UK," said the statement.
It went on to say that said Bowtell had offered his resignation following talks with chief executive Peter Long.
Long said: "“It is now clear that at the time of merger there were weaknesses in the legacy systems we chose to use in the TUI UK business.
“Despite the fact that this situation had built up over a number of years, Paul is behaving honourably and I am disappointed that he will be leaving the group."
Bowtell will stay on until the end of the year. Long added: "I have specifically asked Paul to remain with the business to see through the full year audit and production of our preliminary results. I will miss working with him and wish him every success for the future.”
The statement added: “As a result of process improvements during the year, the impact in 2010 has been limited to £5 million, in line with the third quarter statement.
“Accordingly, TUI Travel remains confident that full year results for the year ended 30 September 2010 will be in line with previous guidance and that net debt will be lower than previous guidance.”
A “full and detailed review” of systems and processes has now been conducted and the company said it was satisfied that the weaknesses in the systems had been rectified.
TUI UK is now under a new leadership team of managing director Northern Region Johan Lundgren and Colin McKinlay, who joined on October 1 as finance director from Homeserve, where he was UK finance director.
The company added that the stronger recent trading trends in its last trading update have continued.
TUI will announce the preliminary results for the year ended September 30 on December 2.
By Linsey McNeill
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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