Thomas Cook needs to slash debts
HOLIDAY giant Thomas Cook has put its airline up for sale to slash debts and turbocharge a turnaround.
The firm is looking at options for the offshoot, which has 103 planes, generated £3.5billion in sales last year and saw profits surge 37 per cent to £129million.
Analysts say the airline, with its prized take-off and landing slots, could be worth between £1billion and £1.5billion, which dwarfs Thomas Cook’s £477million stock market value. The tour operator needs money to plough into hotels and online, and cut its near £1.6billion of debt which cost it £150million in interest last year.
CEO Peter Fankhauser said: “Thomas Cook doesn’t need to own an airline to be a successful holiday company.”
Around half the airline’s 20million passengers a year are Thomas Cook holidaymakers. Having those guaranteed “bums on seats” is appealing for a buyer, with easyJet, Ryanair and British Airways owner IAG thought of as potential suitors.
The review triggered a jump in Thomas Cook’s share price yesterday, despite cut-throat competition leading to losses soaring by £14million to £60million in the final three months of last year. Revenue rose one per cent to £1.65billion.
Thomas Cook said “some consumer uncertainty”, including around Brexit, was impacting summer holiday bookings. Package holiday sales are down 12 per cent in line with a cut in the number of breaks for sale but prices are up four per cent. down 79.5 at 7093.6 Ferguson GlaxoSmithKline Halfords Hays HSBC Imperial Brands International Airlines Grp ITV Kingfisher Land Securities Legal & General Lloyds Marks & Spencer Morrison National Grid Next Pearson Prudential Reckitt Benckiser RELX 5276.0 1546.4 228.8 153.9 641.5 2565.5 664.0 129.2 226.5 879.8 262.8 57.2 288.8 241.9 844.9 4878.0 920.6 1518.5 5861.0 1706.0 -17.0 -1.6 -0.2 -3.3 -9.1 +30.0 -3.6 -3.7 -4.7 +3.4 -4.1 -1.1 -6.1 -3.9 +1.0 -18.0 -7.2 -29.5 +4.0 -9.5 Oil = $60.83 Rentokil Initial Rio Tinto Rolls-Royce Royal Mail RSA RBS J Sainsbury SSE Severn Trent Serco Sports Direct Shell Smith & Nephew Smiths WH Stagecoach Standard Chartered Standard Life Aberdeen TalkTalk Taylor Wimpey Tesco 355.0 4267.0 902.8 276.1 525.0 240.0 290.9 1173.5 2005.0 111.9 273.3 2451.5 1545.0 1980.0 153.5 625.4 250.9 99.7 164.3 227.8 -2.4 -31.5 -6.8 -3.9 -7.4 -9.8 -1.7 -11.0 -8.0 -2.1 -1.6 -37.5 +83.5 0.0 -0.1 -13.9 -6.7 -0.9 -4.1 -1.9 Thomas Cook Unilever United Utilities Vodafone Reach PLC 34.2 4173.0 830.4 139.4 57.0 +3.1 +3.0 +0.8 -3.0 -0.5