TIDMTCG
RNS Number : 8729K
Thomas Cook Group PLC
27 September 2016
27 September 2016
Pre-close trading update
Highlights
-- Summer 2016 closing out as expected, with strong demand for
most destinations apart from Turkey
-- Winter 2016/17 bookings are in line with last year
-- Full year underlying EBIT guidance unchanged
-- Focused on continuing to improve the customer experience, and
delivering substantial progress in our New Operating Model,
including a new hotel sourcing partnership with Webjet and the
launch of Thomas Cook China
Peter Fankhauser, Chief Executive of Thomas Cook commented:
"The Summer season has progressed largely as expected.
Customers' desire to go abroad on holiday has remained strong with
the exception of Turkey where demand continues to be volatile. To
date, sales for the Winter season are in line with last year while
sales so far for Summer 2017 suggest that customers are booking
early in an effort to secure their first-choice destination and
hotel.
"We remain focused on ensuring that we have the right holidays
available in the most popular destinations in order to meet changes
in customer demand. At the same time, we continue to transform our
business for profitable growth. We've taken big steps forward in
recent months with the agreement of a new hotel sourcing
partnership with Webjet and the launch of Thomas Cook China.
However, we're particularly proud of the improvements we've
delivered in customer satisfaction thanks to the work we've done to
strengthen the quality of our offering. We know that the increased
loyalty we get from happier customers is key to driving the future
success of our business."
Current trading
Summer 2016
Overall Group bookings remain in line with our expectations.
Excluding Turkey, bookings are up by 8% across the Group as a
whole, while including Turkey, bookings are down by 4%. Sales have
been driven by demand for high-volume destinations including the
Balearic and Canary Islands and the USA, alongside smaller
destinations like Bulgaria and Cuba. Our Summer 2016 programme is
89% sold for the Group, 3% below the same period last year.
Year-on-Year
Summer 2016 Variation %
--------------------------
Bookings
Bookings(i) ASP(i) % Sold(ii) ex Turkey(i)
UK +1% -5%(iii) 92% +13%
Northern
Europe -6% +3% 99% +5%
Continental
Europe -9% -3% 87% +7%
Airlines
Germany -3% -2% 90% +7%
Total -4% -4% 89%(iv) +8%
Based on cumulative bookings to 17 September 2016
Notes: (i) Risk and non-risk customers
(ii) Risk customers only
(iii) UK average selling price is up by 2% for charter risk and down by 4% for seat-only, resulting in a 5% decline on a blended basis due to the change in mix
(iv) For the tour operator only, the Summer 2016 season is 89% sold, 2% lower than this time last year
In the UK, bookings are slightly higher than the prior year.
Charter risk average selling prices remain strong at 2% above last
year, reflecting a focus on better quality product and a shift
towards more premium destinations. Overall UK average selling
prices are down 5% reflecting the planned growth in our seat-only
business, which has lower average selling prices compared with
package holidays.
Northern Europe bookings are 6% lower, in line with capacity
cuts made as part of our destination strategy, and against a very
strong performance in the comparative period last year. Pricing is
up 3% compared to last year, reflecting strong demand for our
differentiated holidays.
In Continental Europe, bookings are 9% lower than at this time
last year reflecting continued weak consumer confidence, including
in Belgium where demand is significantly down as a result of the
Brussels terror attacks. Overall pricing is 3% below last year's
levels. In Germany, bookings are 6% lower than this time last year,
but we continue to outperform the wider tour operating
industry.
For Airlines Germany (Condor), bookings are 3% lower than last
year, and pricing is down by 2%. The business continues to be
impacted by lower yields due to overcapacity and increased pricing
pressure, amid intense competition particularly in the short and
medium haul market. We have taken steps to move capacity away from
Turkey and increased the focus on cost efficiencies, in order to
improve Condor's performance in FY17.
Winter 2016/17
Our Winter 2016/17 season is 27% sold(v) , consistent with the
same period last year. Overall Group bookings are in line with the
strong comparative period last year, and pricing is down 1%. In the
UK, we are pleased with the early start to the Winter season with
bookings up 8% and average selling prices down 3%, which reflects a
higher mix of seat-only bookings. In Northern Europe bookings are
down 3%, reflecting capacity cuts and a strong comparative period
last year, with pricing down 1%. While it is still early in the
booking cycle for Continental Europe, trading patterns for Winter
are similar to those seen over the Summer, with weak demand,
particularly in Germany and Belgium.
Summer 2017
For Summer 2017, we have seen an encouraging start to bookings,
which are ahead across all source markets at this early stage,
particularly Continental Europe and Northern Europe. Overall,
average selling prices are ahead of last year.
Note (v): For the tour operator only, the Winter 2016/17 season
is 44% sold, which is 1% lower than this time last year
Outlook
We continue to experience good demand for our holidays in the UK
and Northern Europe, offset by weaker demand in Germany,
particularly for Turkish destinations. Our expectations for full
year underlying operating profit remain in line with previous
guidance. The Group is well positioned for future growth - we have
a strong balance sheet, a resilient business model and a strategic
focus on strengthening our holiday offering for the benefit of our
customers.
Forthcoming announcement date
The Group intends to announce its full year results to 30
September 2016 on 23 November 2016.
Enquiries
Analysts & James Sandford, Thomas +44 (0) 20 7557
Investors Cook Group 6433
Tej Randhawa, Thomas +44 (0) 20 7557
Cook Group 6487
Robin Tozer, Thomas +44 (0) 20 7294
Media Cook Group 7031
This information is provided by RNS
The company news service from the London Stock Exchange
END
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