Struggling Thomas Cook given boost
May 12 2012
Britons eager to escape the UK's dismal weather have given a boost to struggling holiday firm Thomas Cook's turnaround.
The 170-year-old company, which came close to collapse last year, said the wettest April on record and an advertising campaign featuring a rock cover of Louis Armstrong's Wonderful World led to an improvement in recent bookings.
UK bookings for the summer were down 1% on the previous year, slightly better than the 2% decline it reported in March, while a reduction in capacity meant it had 19% fewer holidays to sell than a year ago.
Meanwhile, a sale or leaseback deal on 17 aircraft was expected raise £182.9 million to help strengthen its finances.
The group's underlying losses for the six months to March 31 widened by 58% to £262.7 million, reflecting difficult trading conditions in most of its markets, particularly the impact of the Arab spring on bookings to the Middle East and North Africa and poor trading in Canada.
In the UK, losses widened 9% to £173.6 million, including £14.9 million losses from the Co-operative business it bought in October. Separately, it expects to take a £70 million charge from its restructuring and the amendment of a deal with its lenders, which saw it ask for an additional £200 million from its banks.
Chief executive Sam Weihagen said: "Today's announcement demonstrates the progress which we continue to make to strengthen the group's financial position, with the aircraft disposals providing substantial additional liquidity. As expected, the first half seasonal losses have widened however, summer bookings have improved in recent weeks."
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