Thomas Cook, Britain’s best known holiday company, is on the brink of collapse, with bosses scrambling to secure extra funding to prop it up.

This is Money has charted the highs and lows of Thomas Cook’s financial history and share price since 2007, to show where it’s all gone wrong for the stricken travel group. 

19 June 2007: Thomas Cook Group was formed by the merger of Thomas Cook AG and MyTravel Group.

14 February 2008: Thomas Cook bought booking website Hotels4U.com for £21.8million. It marks the first of a series of acquisitions during that year that boosted the share price. 

During 2008, Thomas Cook also snapped up luxury travel firm Elegant Resorts, Gold Medal International and Jet Tours. And it bought back its licence to operate the Thomas Cook brand in the Middle East and Asia.  

Highs and lows: The peaks and troughs of Thomas Cook's share price performance and history since 2007

Highs and lows: The peaks and troughs of Thomas Cook’s share price performance and history since 2007

August 2011: Chief executive Manny Fontenla-Novoa resigned after eight years at the helm. He presided over a massive destruction in shareholder value since taking the reins after the merger with MyTravel.

His resignation followed a disastrous year in which Thomas Cook issued a string of profits warnings. The company saw the Arab Spring takes its toll on holiday bookings to Egypt, Tunisia and Morocco.

In October 2011, Thomas Cook merged its UK high street travel and foreign exchange businesses with those of the Co-operative Group. 

November 2011: Thomas Cook is forced to ask for a capital injection of £100million from its banks to keep it afloat. That is in addition to another £100million short-term credit line that Thomas Cook had agreed with its banks in October.

READ  Sterling and Wilson files for Rs 4,500 crore IPO

The group is also forced to axe its dividend to repair its battered finances, having by then racked up debts of close to £1billion. 

August 2012: Harriet Green becomes the new chief executive and announces a turnaround plan which will see the closure of over 200 High Street shops and some 2,500 redundancies over the next couple of years. 

Her turnaround plan saw pre-tax losses shrink from £337million in 2012 to £158million in 2013. Green is pushed out in November 2014, causing shares to crash.   

Summer 2016: Terror attacks across Europe, including in Brussels in March and at Instanbul’s airport in June, hit bookings. 

Terror attacks: In 2016, terror attacks across Europe, including in Brussels in March and at Instanbul's airport in June, hit bookings at Thomas Cook

Terror attacks: In 2016, terror attacks across Europe, including in Brussels in March and at Instanbul’s airport in June, hit bookings at Thomas Cook

Thomas Cook also continued to suffer from holidays’ cancellations to Egyptian resort Sharm el-Sheikh Trips after terrorists blew up a Russian airliner shortly after it took off from the airport at the Red Sea hot spot in October 2015.  

September 2018: Thomas Cook shares begin a new decline. The company issued another profit warning, having already issued one in July. It blamed the hot weather in Europe for customers delaying holiday-booking decisions, with the UK market particularly slow. 

28 August 2019: Thomas Cook agrees major rescue deal with China-based Fosun Tourism Group. It said they had £900million of new money coming in – half from a Chinese consortium and half from their British-based banks and lenders.

They also agree that banks would convert most of the money the company already owed into equity in a restructured Thomas Cook – which should give the troubled firm some breathing room. 

20 September 2019: Thomas Cook is told by lenders that it needs to find an additional £200million ‘seasonal stability facility’ to cover the winter lull in business in the tourism industry. That is on top of the £900million already agreed. 

The company said it is in talks with stakeholders, including leading shareholder Chinese firm Fosun, to bridge the funding gap. But it said that if it does not find thew money, there was a ‘significant risk of no recovery’.

If Thomas Cook does collapse, it would mean the closure of 550 high street stores, the loss of 22,000 jobs, 180,000 holidaymakers stranded overseas, the biggest peacetime repatriation in British history, and a £600million bill for the DfT who would be left picking up the pieces and flying tourists home.

At the close of play on Friday, Thomas Cook’s share price was down 22.78 per cent or 1.02p to 3.45p.  

Thomas Cook's own timeline of acquisitions and major events since it was formed in 2007

Thomas Cook’s own timeline of acquisitions and major events since it was formed in 2007 

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.



READ SOURCE

WHAT YOUR THOUGHTS

Please enter your comment!
Please enter your name here