£20m cost of chaos - Thomas Cook
Chief executive Manny Fontenla-Novoa yesterday said the firm was switching its travel programme to other holiday destinations to help offset the financial impact.
The group's first-quarter figures to 31 December showed revenues up 7 per cent to 1.8 billion and a 10 per cent reduction in seasonal underlying operating losses to 37.3 million, thanks to strong performances in Germany and northern Europe and a cost-cutting drive.
The company said it remained cautious over the outlook for the UK business, with consumer confidence shaky following government spending cuts and tax hikes. But its bookings for the summer 2011 season have picked up since New Year across all markets and the group is adding capacity.
Shares in Thomas Cook jumped 2.2 per cent to close at 197.8p yesterday.
Analyst Wyn Ellis, of Numis Securities, said: "Whilst Thomas Cook describes bookings for the summer as being 'encouraging', we have some concerns about the UK outlook - margins are an issue, we believe, and the company may struggle to fully offset inflationary pressures. We see little cause for excitement in the shares."
Thomas Cook is facing a potential clash with investors after a lobby group issued an alert for Friday's shareholder meeting over the decision to change bonus targets for bosses. The Association of British Insurers is concerned that the company's long-term bonus goals were changed to take account of the financial crisis and volcanic ash cloud.