Thomas Cook has shaved £30 million off its winter losses despite a drop in sales to Egypt.
The unrest in Egypt meant 250,000 fewer holidaymakers travelled to the destination in the six-month period, equating to a £131 million hit on revenues and £14 million on profits.
But despite this, it managed to reduce its traditional first half losses from £217 million last year to £187 million.
“This demonstrates not only the benefits of the Group’s increased financial strength that enables it to withstand such external events, but also, importantly, of its gathering earnings momentum,” said chief executive Harriet Green.
The group said the summer season is currently approximately 60% sold across all markets, in line with last year, and 66% sold in the UK.
UK bookings are 1% lower than last year in line with a similar reduction in capacity commitments and headline average selling prices are 3% lower than last year due.
Thomas Cook said this was mainly to product mix and a higher proportion of shorter duration holidays reflecting customer demand.
“Our summer 2014 booking performance is developing well with solid volumes in our main markets. Although our UK business has experienced some pricing softness for the Summer season, profit performance has been improved through the successful delivery and acceleration of our ‘Cost Out’ measures,” it said.
“Our profitable growth strategy remains on track. The enhancement of our exclusive hotel products and the expansion of growth areas such as Winter Sun and City Breaks underpin our strategy of delivering revenue growth and improved margins over the medium term.
“Given the early stage of development and the low season over the winter period, the benefits of this strategy have not yet been fully reflected in the Group’s results for the first half of 2014.
“However, we are very encouraged by early Winter 14/15 bookings, which are over 11% higher than last year in the UK with an increase in average selling prices of 2%. This represents the first tangible benefits of our enhanced product and Winter Sun strategy.”
