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Thomas Cook reports fall in revenue in wake of European terror attacks

Published 28/07/2016

Thomas Cook has reported a fall in revenue
Thomas Cook has reported a fall in revenue

Terror attacks across Europe have taken their toll on Thomas Cook, with the travel firm reporting a fall in revenue for the third quarter.

The company said that sales dipped 8% to £1.85 billion following terrorist incidents in Turkey and Brussels while pre-tax losses grew to £64 million. Summer bookings were down 5%.

"While demand for most other destinations has been strong, demand for Turkey has been volatile and remains significantly below last year's levels.

"We have made further capacity cuts to Turkey for summer 2016 and switched this into alternative destinations including Spain, Bulgaria, Greece, Cuba and the USA," the firm said.

Thomas Cook also flagged "significantly lower demand" in Belgium as a result of the Brussels terror attacks.

The travel company's chief executive Peter Fankhauser said that while Brexit has had "no noticeable impact" on bookings, Britain's vote to desert the European Union has "added to a general sense of uncertainty - for our business and our customers alike".

Thomas Cook also lowered its full year earnings guidance from between £310 million and £335 million to around £300 million.

Laith Khalaf, senior analyst at Hargreaves Lansdown, said: "Thomas Cook is facing severe disruptions right now, with political upheaval, acts of terrorism, and the fall in the pound resulting from Brexit all serving to deter holiday makers from travelling.

The company's falling revenues were greeted by a strong rise in the share price, which is testament to just how low expectations were."

Thomas Cook shares were up 8.75% in morning trading.

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