Thomas Cook warns Tunisia, Greece will hit bottom line

British travel operator Thomas Cook on Thursday warned that the recent terror attacks in Tunisia and the ongoing fallout from the economic crisis in Greece would affect its annual results.

The company said it expected its profit before tax and interest to fall by £25 million (35 million euros, $39 million) due to events in Tunisia and Greece, with Tunisia accounting for £20 million of that drop and the eurozone crisis for £5 million.

Tourist numbers to Tunisia have dwindled following an attack at the Bardo Museum in Tunis in March in which 22 people were killed, and another at a hotel near Sousse in June in which 38 were killed, including 30 Britons.

Thomas Cook evacuated more than 15,000 tourists on around 60 flights following the hotel shooting massacre.

The depreciation of the euro and the Swedish krona against the British pound is also expected to hit profits by around £39 million, Thomas Cook said.

Thomas Cook said it was still expecting growth this year on a constant currency basis.

In the third quarter ending in June, the company made an operational profit of three million pounds compared to a loss of £42 million a year earlier.

"We've delivered a good performance in the third quarter, executing on our strategy and improving our underlying operating profit and cash flow in spite of weaker market conditions," Thomas Cook's chief executive Peter Fankhauser said in a statement.

"While the impact of Tunisia and Greece will reduce our fourth quarter and full year profits, and in spite of foreign exchange headwinds, I have every confidence that our progress will continue."
Source: AFP