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Research Tree provides access to ongoing research coverage, media content and regulatory news on THOMAS COOK GROUP PLC. We currently have 11 research reports from 2 professional analysts.

Open
87.2
Volume
1.6m
Range
85.4/87.2
Market Cap
1,324m
52 Week
54.6/108
Date Source Announcement
16Feb17 10:41 RNS Holding(s) in Company
15Feb17 16:49 RNS Director/PDMR Shareholding
09Feb17 12:52 RNS AGM Statement
09Feb17 07:00 RNS First Quarter Results
17Jan17 15:45 RNS Holding(s) in Company
22Dec16 12:38 RNS Holding(s) in Company
15Dec16 12:10 RNS Annual Report 2016 & Notice of AGM 2017
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Cautious stance for 2017 despite positive Q1

  • 09 Feb 17

Figures in line with expectations but overcapacity in Spanish island resorts reduce visibility Thomas Cook started the FY16/17 year by reporting sales growth in line with our expectations. Sales were up 1%, fuelled by holidays to Greece, Spain and long-haul destinations. Own-brand hotels (10 new hotels due to be open for the Summer 17) and the selected partner strategy contributed to the +10bp improvement in the gross margin (+22.1%) with the seasonal EBIT loss reducing slightly yoy (by £1m to £49m) in this quieter quarter. In December, TCG issued a €750m bond (at 6.25% coupon, i.e. 150bp lower than the two bonds it replaces, maturing June 2022) with the next maturity of €800m (bank facility) postponed to 2018. But the statement was marked by a cautious stance for the rest of the year, adopted by management, warning about the uncertain political and economy outlook. Broadly positive winter season, Condor continued to feel the pain of tight competition in Germany With 82% of the programme sold to date (at par with Q1 16), bookings were up 1% (+5% excluding Turkey), offset by a 1% drop in prices, attributable to the tense price environment in the airline market. Bookings reflect the strong demand for Spain, several long-haul destinations (Dominican Republic), making up for the continued shift away from Turkish destinations. The Winter season benefited from strong UK (bookings up +5%), reflecting growing demand for package holidays (+9%, prices up +4%) and seat-only sales (+9%). Continental Europe (bookings down 3%, poor demand from Germany and Belgium for Turkey) improved slightly (differentiated products are behind the 2% rise in prices) and limited the damages caused by the loss-making Condor (German Airline, c.17% of sales, bookings down 1%, capacity cut of 5%, prices down 1%) which has been hampered by the intense competition in the German market (overcapacity in the Canaries in particular). The business has been under restructuring measures, the benefits of which are due to come through from H2 17. UK bookings coming under pressure from rivals in the Spanish island resorts At this early stage of the booking cycle, the Summer 17 season showed encouraging trading with bookings up 9% and prices in line with Q1 16. 31% of the programme is sold to date (2% above last year). The group counts on popular Greece, which is its “stand-out” destination (bookings up 40% in Q1 17, c.2.5m holidaymakers) along with smaller destinations in Europe (Cyprus, Bulgaria, Portugal and Croatia) to compensate for the weak demand for Turkey and Egypt for the key summer season. Current trading for the summer season is encouraging and was in line with expectations. Prices are holding tight in Continental Europe and Northern Europe and particularly in the UK (bookings up 1%, prices +2%). But the UK market may be hampered by the intensifying competition seen in Spanish islands (Majorca and the Canaries in particular), translating into a mix of hotel price inflation (up to 6-8% rise after surging demand last year) and increased air capacity. This pushed TCG to focus further on more profitable destinations and quality holidays rather than chasing volumes in the UK market (bookings up 1% overall). This is behind the slight drop in UK charter risk holiday bookings compared to last year while prices are up 9%.

TCG benefiting from its asset-owner status

  • 01 Dec 16

Strong underlying business in FY15/16 despite the fallout from terrorist activity TCG ended the year by producing sales broadly in line with FY15 (including FX tailwinds), showing a limited decrease (-0.3% reported, -4.5% lfl) in the light of the tough trading in Turkey (-7.4% impact), Egypt (-2%) and Tunisia (-1.3%) which were offset by a reactive shift of capacity to alternative and popular destinations (Spain in particular, +2.2% impact), including long-haul (+2.3%, including the US, Mexico, Cuba and Dominican Republic) while FX was also supportive (+5.9%). The underlying gross margin was up 80bp to over 23% with underlying EBIT at £308m, £3m ahead of the guidance issued as part of the Q3 16 results but £41m below last year’s due to Condor being weak (-470bp yoy) and the impact of terrorism in Belgium (-€10m impact on the underlying group EBIT at €308m). The UK (EBIT margin at 6.4%, +150bp) and Continental Europe (EBIT margin at 11%, +180bp) delivered record underlying EBIT margins despite a challenging Condor (EBIT margin from 5.1% to -0.8%), the group’s German airline (15.4% of group sales) which was heavily impacted by weak demand (disruption to key destinations and increasing competition over fewer routes). For the second year in a row, TCG showed a modest but positive net profit of £9m and a restart of the dividend policy (with a symbolic ordinary dividend at £0.005 per share) after five years of interruption. Encouraging winter trading and rebooting dividend Current trading is encouraging with 61% of the winter programme sold, slightly higher than last year. Group bookings are up 2% but pricing is down 2% given the tough comps from the UK and Northern European businesses. The UK business continues to perform well on the back of the expanded winter sun programme (new long-haul destinations including Cape Town and Tobago). Northern Europe should continue to be dragged down by the poor demand in Germany, and impacted by Turkey (-5% in bookings), while Condor is still hampered by poor yields due to overcapacity and weak demand. But differentiated and long-haul holidays experienced a 5% rise in prices. Summer 2017 shows strong pricing overall and bookings ahead of last year, despite being early in the booking cycle.

Weak bookings ahead of the key summer 16 season

  • 27 May 16

TCG is feeling the pain of the terrorist activity Thomas Cook last week reported its H1-16 results which were short of the the consensus and our expectations. The FY16 guidance has been revised down to the bottom end of expectations. As a result of the terrorist attacks in Turkey, Tunisia and Brussels, TCG warned that Summer 16 bookings (63% sold, -2% yoy) had fallen by 5% (up to 10% for Continental Europe, -6% in Germany). Demand for Turkey, Tunisia and Egypt has collapsed. Overall, the pricing pattern is negative yoy (except for differentiated holidays, in the UK notably) while the collapse in demand for Turkey has resulted in later bookings for the destination. Summer bookings on average have been made almost two weeks later than last year. Since TCG has been prioritising margins over volumes, the Group cut capacity by 4% at Group level. Strong Mediterranean destinations have not yet fully offset weak demand for Turkey Excluding these problematic destinations, demand for Spain (summer 16 bookings were up 14% yoy in the Balearics) and the Canaries (+23%) but also the US (+29%) and the Caribbean (Cuba and Mexico) soared while, excluding Turkey, bookings were up 6% yoy and 13% excluding Turkey, Egypt and Tunisia. The long-haul programme (bookings up 19% in the UK) has also been helpful in mitigaging the impact of North Africa along with the seat-only offering, although the latter has lower average selling prices than package holidays.