By Matt Scuffham
LONDON (Reuters) – Thomas Cook said its performance in Britain had improved as a new advertising campaign and improvements to its website boosted sales, offering some respite for the world’s oldest travel company which issued three profit warnings last year.
Thomas Cook (TCG.L), which secured a 200 million pound rescue package from lenders in November, reported an uplift in online bookings by British customers, with internet sales up 19 percent year-on-year in the past four weeks.
“In the last few weeks we have seen an improvement in UK booking trends, helped by our recently launched advertising campaign and upgrades to our thomascook.com website,” acting chief executive Sam Weihagen said on Wednesday.
“Trading across the group has been stable since we last reported and in line with expectations.”
Thomas Cook endured a dire 2011 with a slump in sales culminating in the departure of veteran chief executive Manny Fontenla-Novoa in August and a funding crunch requiring the company to ask its banks for new financing.
Thomas Cook shares, which have lost over 90 percent of their value in the past two years, were up 3.2 percent to 24 pence at 0905 GMT, as the upturn in trading provided evidence consumer confidence in the brand was being revived.
“Thomas Cook has been in existence for 170 years and, although that perhaps means little, consumers seem to be sticking with the company and the group has felt able to suggest that summer 2012 trading is more encouraging,” Langton Capital analyst Mark Brumby said.
Thomas Cook has been hit hard by tough trading conditions, especially in Britain where its core customer base of families with young children has been particularly affected by the economic downturn. It has also been hit by social and political unrest in popular destinations such as Egypt, Tunisia and Morocco.
It said bookings in Northern Europe and West and East Europe were slower than expected, adding it had the flexibility to cut the number of holidays on sale if demand did not pick up.
Thomas Cook, which put its Indian business up for sale in February as part of a disposal programme to reduce its 890 million pounds debt, said it had seen a good level of interest in the business and the sale process was progressing well.
The company did not give an update on the search for a chief executive. Weihagen, who had been Fontenla-Novoa’s deputy, has been in the role on a temporary basis for the past eight months, having postponed a planned retirement.
Rival TUI Travel (TT.L), which owns Thomson and First Choice, was due to publish a trading update on Thursday.
(Editing by James Davey and Dan Lalor)
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