Thomas Cook tanks as it posts £1.46bn loss

Brexit chaos hits Thomas Cook as losses mount to £1.5bn

Thomas Cook slumps to £1.46bn half-year loss as Brexit hits holiday demand

It has also confirmed "multiple" bids have been made for all or part of its airline.

Shares in the troubled holiday firm plunged 16% after pre-tax losses widened from £303 million a year earlier and it warned second half earnings would be hit amid tough trading over the key summer period.

Thomas Cook also took an impairment charge of £1.1 billion relating to a 2007 merger with British package-holiday company MyTravel.

Thursday's report was Thomas Cook's third profit warning in less than a year, which has led to an 80% drop in its share price since 2018.

"The prolonged heatwave last summer and high prices in the Canaries reduced customer demand for winter sun, particularly in the Nordic region, while there is now little doubt that the Brexit process has led many United Kingdom customers to delay their holiday plans for this summer", he added.

The company has closed 21 of its stores, its currency arm Thomas Cook Money is under review and more "cost efficiencies" are planned.

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To cut costs, Thomas Cook is closing 21 United Kingdom branches with the loss of 320 jobs, and is looking to shut more, as well as scaling back its head office in Peterborough. "We hire a house in the summer and drive through the Channel Tunnel and make overnight stops in hotels en route", says David Turner.

"We are concerned that there will be long delays at customs as passports and vehicles are checked and further delay and queues on both sides of the channel leading to the tunnel".

The half-year result covers the winter period when travel companies traditionally struggle to turn a profit, but was still several times larger than the loss of £303m for the same period a year ago.

"The continued competitive pressure resulting from consumer uncertainty is putting further pressure on margins", Fankhauser said. Higher fuel and hotel costs were "creating further headwinds".

Thomas Cook has cut its capacity in anticipation of a slowdown, but said continued to "face intense competition, particularly in our United Kingdom business".

Profits in the second half of the year would be lower than the same period last year, the company said.

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Mr Fankhauser said customers were "having a great deal this summer".

Julie Palmer, partner at Begbies Traynor, said that pressure was mounting on Thomas Cook to sell off its airline.

"Perhaps more significantly it has secured financing through next winter giving it time to sell the airline, for which it has received multiple bids at good levels, implying a valuation of up to $1.3 billion (£1 billion) which would be a very positive outcome".

The company is moving into the Russian and Chinese markets, and is also aiming to expand in the more profitable hotels business.

"The measures Thomas Cook is taking to get itself back on track look sensible, but with so many challenging factors outside its control, it's still a hostage to fortune", Hargreaves Lansdown senior analyst Laith Khalaf said.

Saying the results make for "grim reading", Khalaf added: "Thomas Cook's scaled back the holidays it's offering in response to lower consumer demand, but the competitive environment means that even so, it's having to offer discounts to get customers to part with their cash".

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