Travel operator Thomas Cook (LON:TCG) has “got the year off to a good start”, seeing a 7 percent revenue rise in the first quarter of the year.
Seasonal underlying operating loss improved by £10 million to £42 million, with its full year outlook remaining in line with expectations. Gross profit increased by £16 million to £376 million, despite a 50 basis point fall in gross margin to gross 21.5 percent due to higher hotel prices in Spain and fewer long haul sales.
The group said: “From all that we see so far, customers’ appetite for a summer holiday abroad shows no sign of slowing down. We’ve taken early action to meet strong demand for destinations in the Eastern Mediterranean. This has enabled us to shift capacity out of the Spanish islands where we have seen a continuation of the margin pressures we experienced last summer.”
The group’s own airline also saw an improvement in performance, reporting an underlying loss of £13 million – an improvement of £9 million.
Peter Fankhauser, chief executive of Thomas Cook, said:
“This remains a highly competitive – and, at times, unpredictable – market, as the disruption in the airlines sector in recent months demonstrates. However, based on current trading and the continued progress we are making on implementing our customer-focused strategy for profitable growth, we expect to deliver a performance in line with current expectations for the full year.”
Shares in Thomas Cook are currently trading down 2.87 percent on the news, at 121.70 (0846GMT).