One might have expected Thomas Cook (TCG) to paint much the same picture of trading as its rival TUI Travel (TT.), which this month reported buoyant demand from British holidaymakers. On the contrary, Thomas Cook said its UK business was harmed by ongoing political tension in Egypt. Instead continental Europe, specifically Germany, performed slightly better.
Chief executive Harriet Green said far fewer UK customers chose to travel to Egypt over the winter as a result of the country's political problems. But next year should be better. The release of multiple new products into the UK market, no doubt combined with the early effects of the recovery in real earnings, has so far driven early winter bookings for 2014/15 11 per cent higher.
The group also expanded on ‘Wave 2’ of its turnaround plan, which was first announced last November and aims to deliver £400m of savings by 2018. Four regional businesses will be amalgamated into one unit and 17 web platforms scaled down to one. Website bookings grew to 39 per cent of the total in the first half - just shy of the annual target of 40 per cent - about a sixth of which were through mobiles or tablets.
Brokerage Investec expects pre-tax profits of £209m for 2014, giving EPS of 11.4p - up from £118m and 4.9p.
THOMAS COOK (TCG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 168p | MARKET VALUE: | £ 2.45bn | |
| TOUCH: | 167-168p | 12-MONTH HIGH: | 190p | LOW: 110p |
| DIVIDEND YIELD: | NA | PE RATIO: | NA | |
| NET ASSET VALUE: | 6p* | NET DEBT: | £811m | |
| Half-year to 31 March | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 3.22 | 393 | -23.9 | nil |
| 2014 | 3.01 | 366 | -25.3 | nil |
| % change | -7 | -7 | - | - |
Ex-div: n/a Payment: n/a *Includes intangible assets of £2.99bn or 205p per share | ||||
