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24 Sep 2015

BY Edward Robertson

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TRFBLI

Thomas Cook differentiation begins to pay off

The Thomas Cook Group is entering its closed period with a 1% increase in UK sales for summer 2015.

Peter Fankhauser (Thomas Cook)

The operator said in a pre close trading update that is summer capacity for the UK is 95% sold with “significant” increases in customers to Greece and Egypt as Tunisia is “effectively closed for the time being”.

 

Strong growth has also been reported to both the US and the Caribbean following investment in long haul routes.

 

Cook added average selling prices for both its package holidays and seat-only bookings with Thomas Cook Airlines are also up 4% following the relaunch of luxury brand Signature and investment in both hotels and aircraft.

 

However, prices were 1% down year on year on a blended basis due to the change of mix of product on offer.

 

The UK’s strong results mean the entire group is approximately 91% sold for summer 2015 while winter 2015/16 has seen improved bookings. Demand is also strong for the operator’s differentiated hotels with bookings up 38% for the summer.

 

Thomas Cook chief executive Peter Fankhauser said: "Our trading performance for the summer season has progressed well, despite the impact of external shocks in certain destination markets, as previously announced.

 

“With more than a third of the winter 2015/16 season sold, the bookings profile for next year is also encouraging.”

 

He added the operator’s transformation is also continuing successfully with the differentiated hotels providing only some of the good news.

 

A focus on mobile has led to a 30% boost in bookings on smartphones and tablets, accounting for one in three bookings made on the OneWeb platform which is live in the UK and being rolled out in the Netherlands. Conversion rates are also up across all devices.

 

The statement added Thomas Cook is now moving into the next stage of its transformation with its New Operating Model, which focuses on the own-brand hotels and airline and more efficient technology, being implemented.

 

It said underlying business is also continuing to develop in line with expectations meaning final results are expected to be in line with those predicted in the third quarter announcement in July.

 

Fankhauser said: “Over the last three years we have made excellent progress transforming our business.

 

“We have developed a strong core holiday proposition based around our own-brand hotels, reduced our cost base, and strengthened our capital structure.

 

“The next phase of transformation will aim to better integrate our businesses across geographies, with a higher quality and more focused holiday offering delivered through our New Operating Model.

 

“With the benefit of our strong brands and through our absolute focus on customer needs, I am confident that this strategy will lead to an even better holiday experience for our customers, further improving our growth and profitability, and increasing returns to shareholders."

The operator certainly seems to have ridden out some of the global shocks this year so it’s good to see such a major brand with positive news.

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The operator certainly seems to have ridden out some of the global shocks this year so it’s good to see such a major brand with positive news.

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