Thomas Cook takes £70m ash hit

THE travel chaos caused by the volcanic eruption has so far cost tour operator Thomas Cook £70 million, but the company said yesterday that bookings were recovering strongly.

Although Europe's second-biggest travel chain cancelled 188,000 holidays due to the widespread closure of airspace last month, bookings in the UK were up 5 per cent year on year over the past four weeks, while those in Germany and Austria were running 10 per cent higher.

Chief executive Manny Fontenla-Novoa said: "Encouragingly, the market is getting stronger and stronger. At the moment, we're out-selling our capacity.

"Our rate of intake is greater than the amount of bookings we've got left to sell."

Fontenta-Novoa said between 50 and 55 per cent of those who cancelled had rebooked for later in the year.

He also said further disruption should be minimal as new protocols had been introduced, enabling airlines to track the ash by satellite and reroute aircraft accordingly.

Thomas Cook, formed through the merger of the UK's MyTravel and Germany's Arcandor in 2007, reported a pre-tax loss for the half year to 31 March of 252.2m, against a 309m deficit in the same period last year. Tour operators traditionally make a loss in the first half ahead of the key summer period.