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Photo: Sunwing Family Resorts / Thomas Coook Group

Thomas Cook issues second profit warning

The tour operator is continuing to suffer the after-effects of this summer’s heatwave across Europe.

Thomas Cook Group has made its second profit warning in two months for its full-year results, as it continues to suffer the after-effects of this summer’s heatwave across northern Europe.

In the Nordic countries, the group includes the tour operators Ving, Globetrotter, Spies, Tjäreborg, as well as Thomas Cook Airlines Scandinavia and accommodation chains such as Sunwing Family Resorts, Ocean Beach Club and Sunprime Hotels. The group sells around 1,500,000 trips a year in the Nordics.

The UK-based operator warns that its profits this year will be about £30 million (€33.8 million) lower than guidance already issued in September, the BBC reports, and £58 million lower than last year.

Earnings specifically in its tour operating unit were as much as £88 million lower in the year to September, as people opted to stay at home due to the long hot spell instead of holiday abroad.

Bookings for this winter are also down on the previous year, by 3%. After announcing the news, shares in the company plummeted 28%.

It has been a “disappointing year”, chief executive Peter Fankhauser admitted, adding: “Looking ahead, we must learn the lessons from 2018 and go into the new year focused on where we can make a difference to customers in our core holiday offering.”

So far, there are fewer bookings this winter for the Canary Islands, but cheaper package tours in Turkey, Egypt and Tunisia are trending upwards.

On the bright, sales of holidays to Cook’s own-brand hotels are up 15% this year, while the group’s airline business is posting rising profits with future bookings up 11% from last year.

Other airlines
Thomas Cook says it will work increasingly with third-party carriers next year for greater flexibility.

“We are flexible. We are more cautions in our approach for next summer in terms of committed airline capacity,” Fankhauser said.

“We will grow more into the dynamic packaging offering along the way when and where we need to increase our capacity.”

Asked whether this would mean using carriers such as easyJet in greater quantities, he agreed.

“Especially in airports where we are not flying with Thomas Cook. This is increasing our flexibility. There will be more to sell in our shops in those regions where we don’t have Thomas Cook offering.”

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