Thomas Cook has posted another significant quarterly loss. In the three months to 30 June 2012, the travel company recorded a pre-tax loss of £96.0 million – almost 70% worse than during the same period last year.
The group was hit by a double whammy of declining revenue and increasing expenses, as it continues to struggle with the weak global economic conditions. Thomas Cook said the 6% drop in revenue (to £2.29bn) was the result of “planned capacity reductions”, while operating costs had risen due to “acquisitions and input cost inflation”. The company posted an operating loss of £26.5m, compared to £20.1m in the same period last year.
Thomas Cook’s newly-appointed chief executive, Harriet Green said that the company was taking steps to improve its performance.
“My initial focus is to review our businesses, quickly establish priorities and develop a clear plan to reinvigorate Thomas Cook, which I expect to be able to present to you next spring,” said Ms Green, who joined Thomas Cook on 30 June. “The group has been through a difficult period, but much has been achieved which has strengthened the balance sheet and improved liquidity. The strength of the group’s brands and the quality of its businesses and people provides a foundation from which to bring the business back to full strength.”
Part of the strategy has seen Thomas Cook divest several assets. HCV Hotels has been sold for £58m, and the company has generated £189m through the aircraft sale and leaseback of its aircraft. The sale of the Thomas Cook India is expected to complete by 22 August, with the net proceeds of £87m to be used to reduce debt.
In the past nine months Thomas Cook has now posted a pre-tax loss of £808.9m.