Geopolitical volatility disrupting holiday bookings, says Cook

Geopolitical volatility disrupting holiday bookings, says Cook

Holiday bookings continue to be disrupted by a volatile geopolitical backdrop, Thomas Cook disclosed today.

Europe’s second largest travel group revealed that some customers are postponing their holiday decisions, leading to a later booking pattern for the summer.

The group’s summer programme is 40% sold, down 2% on this time last year, but with overall pricing described as “firm”. Bookings are 5% down, resulting in charter flight capacity being trimmed by 3%.

Average selling prices in the UK for the summer are up by 4% for package holidays and 1% for seat-only, while total bookings are below last year's levels due to the later booking pattern.

However, Cook believes underlying demand for holidays remains strong as consumers benefit from low fuel prices, low interest rates and low inflation.

“We remain well positioned in this challenging market, with the scale and flexibility to offer our customers a wide choice of destinations,” Cook said.

“We therefore maintain our previous guidance for the full year, but as highlighted at our last update, this is dependent on seeing a sustained recovery in customer confidence as we progress through the summer season.”

Group chief executive, Peter Fankhauser, said as part of a pre-close trading update this morning: "Thomas Cook continues to operate in a volatile market environment. We know that customers want a summer holiday but we can see that some are leaving it later to book this year as they consider their options.

"Against this backdrop I remain confident that we are doing all the right things as a business. It's clear also that customers value packaged travel more than ever and feel safer in our hands.

"The early actions we took to move flights away from Turkey, Tunisia and Egypt have positioned us well for increased customer demand to resorts in the Western Mediterranean, with strong sales to the Canaries, Balearics and the Spanish mainland in recent weeks.

“We have also seen an increase in sales to long-haul destinations such as the USA and Cuba as customers look further afield for their holidays.”

He added: "In addition, we remain focused on delivering our strategy for profitable growth.

“Sales to our own-brand hotels have continued to increase while customer satisfaction is significantly up across all our markets. I am particularly pleased about this given the huge amount of work that our people have put in across all areas of the business.

“I am confident that, in spite of the current market conditions, the actions we are taking to implement our strategy will continue to deliver improved results."

Cook’s winter 2015-16 winter programme is 90% sold, down 2% year-on-year, with average selling prices up by 3% and total bookings down by 3% “broadly reflecting capacity reductions”.

The average winter holiday selling price in the UK is up by 11% for package holidays and by 9% for seat-only sales.


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