Revenues and bookings at Thomas Cook dropped in the last three months of 2015, in the wake of the terror attacks in Paris, Istanbul and Sharm-el-Sheikh, the tour operator said today.
Total revenue for the three months to 31 December fell 7.8 per cent to £1.4bn. The firm's underlying operating loss improved by 11 per cent to £49m.
Current trading is in line with expectations with 82 per cent of the programme sold, broadly the same as last year although pricing was "significantly higher".
However summer 2016 is 29 per cent sold – two per cent lower than last year.
Why it's interesting
The spate of terror attacks in popular tourist attractions has clearly taken its toll, but Thomas Cook is adapting to shifts in demand, increasing the number of holidays it offers to parts of the western Mediterranean, for example.
The business also said there were "clear signs of recovery after customer confidence impacted by the tragic events of Paris and Istanbul".
As a result, although it has suffered a dip, management is not expecting the attacks to affect full year results, and has maintained its guidance for the full year "provided that the recent recovery we have seen in customer confidence is sustained."
What Thomas Cook said
Chief executive Peter Fankhauser said: "We've made a good start to the year, despite challenging trading conditions. Having acted fast to offer our customers a broad range of alternatives to Tunisia and Egypt, we delivered a one per cent increase in revenues in the first quarter…
"It is clear that the awful attacks in Paris and Istanbul impacted confidence, leading some customers to delay booking their holidays. However we've seen clear signs of recovery in recent weeks: customers still have money in their pockets, and want to go on holiday. In this uncertain geopolitical environment, we are also seeing more of our customers choose a package holiday, valuing the greater security it provides.
"We will continue to focus on delivering our strategy – strengthening our own-brand hotels and flights offering, and investing to ensure that customers who choose Thomas Cook get consistently excellent customer service. Thomas Cook is now a significantly stronger and more resilient business, and we are well positioned in a challenging market. We are maintaining our previous guidance for the 2016 financial year, provided that the recent recovery we have seen in customer confidence is sustained."
Thomas Cook needs consumer demand to stay on track if it is to meet its guidance.