Shares in the Group dove 12% in early trading off the back of its full-year results out today.
Companies: Thomas Cook Group
Thomas Cook (LON: TCG) has hit a spot of turbulence this morning after the announcement of its Full Year results for 2017.
Revenues are up 9% to £9 bn while Gross Profit grew by £56m to almost £2 bn in FY17. Gross Profit margins have however been slightly eroded, down 1.3% to 22.1%. Management said increased competition for UK holidaymakers trips to Spain were to blame.
Corporate costs also grew by £5m to £35m in the period, "reflecting a higher level of corporate activity" the report said.
The market reacted unfavourably to the results, with the stock down 12% at the time of writing to 106p.
The Group also owns German carrier Condor Airlines who saw a turnaround during FY17, reporting an improvement in Profits of £24m. This comes as rival German airline Air Berlin recently announced it had filed for insolvency.
With FY18 already well underway, TCG Chief Executive Peter Fankhauser commented:
"Looking to the year ahead, we can see real momentum in our Group Airline, and expect our Continental Europe and Northern Europe tour operator businesses to continue their good performance. While conditions are challenging in the UK, we have implemented a set of actions to improve performance. Overall, based on current trading, I believe that we are well-positioned to achieve a full year operating result in line with market expectations."
Management noted its target of growing customers 10-fold in 2018 for its fledging Chinese tours, whilst the Group also launched its new airline based in Majorca.
The airline and package holiday industry have been through an incredibly rocky year so far, with many of Thomas Cook's rivals being impacted by increasingly tough market conditions, including the likes of Air Berlin and Alitalia going bankrupt, as well as UK rival Monarch's recent collapse.