Thomas Cook cuts profit forecasts in wake of terror attacks, weak pound

28th Jul 2016 09:41

(ShareCast News) - British tour operator Thomas Cook revealed the depth of the problems faced by the travel industry as it again lowered its full year profit forecasts against a backdrop of increased global terrorism concerns and an anaemic pound.The company said it expected full year earnings before interest and tax to be around £300m, a further cut from the £310m - £335m given in May. This would include foreign exchange benefits of £32m.Third quarter underlying profits collapsed to £2m from £30m in the same period last year.The company has been hit by the attempted coup and terror attacks in Turkey and bombings at Brussels airport along with the slump in the pound after the UK's decision to leave the European Union."While demand for most other destinations has been strong, demand for Turkey has been volatile and remains significantly below last year's levels. We have made further capacity cuts to Turkey for Summer 2016 and switched this into alternative destinations including Spain, Bulgaria, Greece, Cuba and the USA," the company said.Chief executive Peter Fankhauser said the company was "operating in a challenging geopolitical environment, with repeated disruption in some of our key source and destination markets"."In addition, while Brexit has had no noticeable impact on our bookings so far, it has added to a general sense of uncertainty - for our business and our customers alike."