Thomas Cook sees losses widen as it struggles with debt
- 31 May 2012
- From the section Business
Thomas Cook has seen its half-year losses increase sharply after a "difficult" six months, but says it is taking "decisive action" to improve its position.
The travel group reported a pre-tax loss of £713m in the half year to 31 March, up from a £269m loss last year.
The company has struggled with high debt levels and the wider downturn in the global travel sector.
Earlier this month, Thomas Cook secured a £1.4bn refinancing package.
This deal gives the company a further three years to repay its debts.
Thomas Cook also secured shareholder approval earlier this week to sell its investments in a Spanish hotel business, and backing for the sale and leaseback of some of its aircraft. The company said on Thursday that when taken together these moves would add £239m to its finances.
The firm has also agreed to sell its Indian business for £94m.
Part of the reason for the big increase in Thomas Cook's losses was a one-off charge of £300m after it was forced to write-down the value of parts of its business.
When this and other exceptional items are pulled out, the firm's underlying pre-tax loss for the six months to 31 March was £328m, compared with £269m a year earlier.
The company is now waiting for its new chief executive Harriet Green to take up the job in July, after her appointment was announced last week.
Interim chief executive Sam Weihagen said the company was moving ahead with efforts to "re-energise our business and begin to rebuild profitability, reduce debt, and continue to provide a fantastic holiday experience for our customers".
Thomas Cook issued three profit warnings last year, and was forced to take an emergency £200m loan.
Its revenues for the six months ending 31 March totalled £3.52bn, up from £3.43bn a year earlier.