Slump in Turkey: Thomas Cook reports dip in summer bookings

Senior market analysts said the news sent ripples of concern throughout the travel sector, which is also today dealing with fears surrounding the missing EgyptAir flight.

 

Connor Campbell, a senior market analyst at www.spreadex.com, said: "Plunging to three-year lows, Thomas Cook dropped a whopping 16% this Thursday as it told that summer bookings were 5% lower year-on-year, with the recent terror attacks, especially those in Turkey, causing a significant drop in demand.

 

"This sent ripples of concern throughout the rest of the sector, which is also dealing with the fears surrounding the missing flight between Paris and Cairo, causing TUI to fall 4% and easyJet to slip 2%."

Although Thomas Cook's overall bookings are down, the company said if you take Turkey out of  the equation bookings to other destinations are 6% up.

 

"As we look ahead to our busiest period, Thomas Cook is trading well to destinations other than Turkey, with particularly strong bookings to Spain and the USA," said chief executive Peter Fankhauser, announcing the group's half-year results today.

 

Thomas Cook said summer 2016 bookings to the Balearics are up 14%, Canaries up 23%, and USA up 29%.

 

"However demand for Turkey - our second largest market last year - remains significantly below last year's levels," added Fankhauser .

 

"This has impacted our German Airlines business in particular. We've also seen a sharp decline in demand in Belgium following the tragic attack at Brussels airport in March."

 

Overall revenues for the six months to the end of March were up to £2.67 million, while winter losses before tax were down from £303 million to £288 million.

 

"Taking into account anticipated foreign exchange translation gains, we expect underlying EBIT for the full year to be between £310 million and £335 million," said Fankhauser.

 

He said the group had undergone a fundamental change in its approach to customers since the inquest into the deaths of two children from carbon monoxide poisoning on a Thomas Cook holiday.

 

"The Corfu inquest was a turning point for Thomas Cook. It was clear to me that we needed to change our mindset and put the customer back at the heart of our business," he explained.

 

"I am proud of the way in which my colleagues across the business have embraced all the changes we have made. We've created a comprehensive new training scheme for all customer-facing staff, rolled out new software to better serve customers in resort, and introduced a 24-hour customer promise in 1,500 of our most popular hotels.

 

"It's early days and there is more to do, but we've already seen a positive reaction from our customers, with improvements in the net promoter score across all our markets."

 

Thoams Cook's online sales grew 10% in UK and 21% in Germany in the second quarter.
Source: Slump in Turkey: Thomas Cook reports dip in summer bookings