LONDON – The Thomas Cook Group has posted a 30% drop in its shares value following the second profit warning that has been released this year. The company claims that the heat wave that hit the UK this year had encouraged people to stay home rather than to travel abroad to usual summer destinations.
Peter Fankhauser, CEO of The Thomas Cook Group said that 2018 has been “a disappointing year.”
“After a good start, we experienced a larger-than-anticipated decline in gross margin, following the prolonged period of hot weather in our key summer trading period,” he said.
“From May to September, the heatwave across Europe meant customers delayed booking trips abroad, leaving us with too much to sell in a heavily competitive market,” Frankhauser explained.
Reportedly, even though the group’s revenue was £9.6 billion, up 6% on a like-for-like basis, its EBIT was only £250 million, a significant decrease of £58 million.
The leisure group also reports that bookings for the winter season are down by 3%, which they attributed to the “knock-on effect” of this year’s heatwave.
It is believed that this announcement caused mirror effects on rival TUI, who also saw its shares fall by 7% once Thomas Cook unveiled its results.
Despite the poor numbers, Thomas Cook Group notes that these drops are also attributed to rising fuel and oil costs, something that has affected several airlines this year.
With the airline being hurt by lower-than-normal demand and the