In its full year results to September 30 Cook reported an underlying group profit of £308 million, down from £310 million last year.
Profit after tax was down from £19 million to £9 million.
However the UK business “continued to strengthen”, achieving a record underlying Ebit (earnings before interest and taxes) margin of 6.4%, growing by £33 million to £152 million.
Group revenue was also down slightly, from £7.83 billion to £7.81 billion and group underlying gross margin rose from 22.6% in 2015 to 23.4%.
Cook will pay a dividend for the first time in five years, which chief executive Peter Fankhauser said “reflects confidence in the strategy and the opportunity for sustainable, profitable growth”.
Fankhauser said: “In what’s been a difficult year for tourism, I’m pleased with the progress that we’ve made at Thomas Cook.
“The early actions we took to shift our holiday programme into the western Mediterranean and long-haul, together with the benefits of a stronger euro, helped us to maintain revenue at group level.
“Additionally, a focus on holidays to our own-brand and partner hotels delivered record profit margins in our UK and Northern European businesses.
“Underlying operating profit for the group was £308 million. This reflects the decline in customer demand for Turkey, which impacted Condor in particular, and the effect on our Belgian business of the Brussels attacks.
“Our renewed focus on quality and service delivered a six-point increase in customer satisfaction in Summer 2016, telling us that the changes we’re making are having an impact where it matters most.
“Right across our business we’re making customers’ experience of our holidays better.
“By focusing on fewer hotels, we can have a bigger influence on quality and service, whether that’s a promise to fix any issues within 24 hours or the reassurance of regular checks on health and safety standards.
“We’re also building a stronger portfolio of own-brand hotels, with the aim of increasing the proportion that we manage ourselves.
“This will enable us to offer holidays that are unique to Thomas Cook and to attract a new generation who might have thought a package holiday wasn’t for them.
“Our renewed focus on the customer has breathed new energy into the business and I’m proud of the way that our people, in our markets and in resort, have embraced the challenge.
“It is these efforts to create lifelong advocates for Thomas Cook that will generate greatest value in the future.”
Cook will take a “cautious” approach to the year ahead.
“We’ve had an encouraging start to bookings for summer 2017 in our key markets, but it is early days,” said Fankhauser.
“In addition, we are addressing the decline in Condor’s profitability with actions that we expect to have a positive impact in the second half of the year.
“Overall, we are confident that our strategy for profitable growth, focusing on improving our holidays for customers, will help us to achieve a full year operating result in line with current market expectations.”
