Egypt trouble to cost Thomas Cook £20m

8th Feb 2011 07:15

The political turmoil in Egypt and Tunisia will knock £20m from Thomas Cook's profits this quarter, the travel group warned, disrupting what had been a good start to the year.Revenue in the first quarter rose by 7% to £1.81bn reflecting increased volumes and improved product mix, while the traditional seasonal loss fell to £37.3m."Throughout Continental Europe, the economic environment continues to support demand, which is reflected in our bookings and capacity plans. In the UK, whilst the consumer outlook remains uncertain, we have seen an increase in summer bookings and the actions taken on costs will further strengthen the business," chief executive Manny Fontenla-Novoa said.He also reported a positive start to summer trading with continental and northern Europe markets particularly strong, though this has been overshadowed by the situation in North Africa.Thomas Cook said it continues to monitor the situation there closely and contingency plans have been implemented to redirect holiday programme to other destinations to help mitigate the financial impact. Earlier this month, rival TUI Travel warned the turmoil in North Africa would cost it between £25m to £30mFor the summer 2011 season, Cook says bookings are 'encouraging and have picked up in all markets since the New Year, underpinning our confidence to add capacity. The economic environment in Continental Europe remains supportive, while in the UK, we continue to remain cautious." However, the problems in North Africa could impact results for the current quarter by £25m to £30m.