Thomas Cook's head honcho steps down

3rd Aug 2011 09:02

Struggling travel operator Thomas Cook said its chief executive officer Manny Fontenla-Novoa will step down effective immediately and appointed deputy head Sam Weihagen to temporarily take charge of the company.Thomas Cook did not divulge any details regarding the reason for his departure but the move comes weeks after the company gave another profit warning amidst investor concern over its debt levels. The board has begun a search for a permanent successor. "The Board is focused on restoring market confidence in the Group, which has been impacted by concerns over debt levels and the poor performance of our UK business. We are taking actions to strengthen the balance sheet, including a disposal programme that we expect to realise up to £200m," chairman Michael Beckett said. The markets seemed to largely welcome this move as the share price shot up following the announcement. In the last month, the company saw its market value drop more than 50%. Moreover, the company said underlying operating profit was £20.1m for the three months to 30 June, compared with profit of £25.8m, in the corresponding period last year, hurt by weak performance in the UK. The company reiterated its outlook for the full year and expects operating profit to be about £320m.Shares of Thomas Cook surged 5% to 63.9p in early morning trading in London.AR