Tag Archives: Thomas Cook Airlines (UK)

IATA: Statement on bankruptcy of Thomas Cook

IATA is following the Thomas Cook bankruptcy with concern. Concern for people and businesses who will be made redundant or who will be out of pocket because of the collapse, and concern for the travelers who are worried about their flights or who have dream holidays cancelled. For those passengers not able to take advantage of the UK CAA’s repatriation program or covered by other holiday insurance schemes, IATA has requested its members enact their voluntary rescue fares operation to bring people home.

Thomas Cook Airlines was not a member of IATA and did not participate in the IATA Billing and Settlement Plan (BSP). The airline has been suspended from the Cargo Accounts Settlement System (CASS), however it was not an active participant at the time of its suspension. With regard to the network of Thomas Cook travel agencies, IATA is following the procedures as stated in IATA’s Resolutions. As a consequence, the issuance of tickets has been restricted for Thomas Cook agencies impacted by the Compulsory Liquidation. Thomas Cook’s subsidiary airline, Condor, is a member of IATA. It continues to operate and is participating in the IATA BSP. IATA continues to monitor the situation.

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BALPA: Thomas Cook German subsidiary (Condor) is rescued while UK staff and holiday makers suffer

BALPA has released this statement:

BALPA has learnt that Condor, the wholly owned German airline subsidiary of Thomas Cook, is being given six months financing by its Government to secure its own rescue deal. Despite its parent and UK subsidiaries going into liquidation on Monday morning, Condor was given £350m capital to continue to operate.

BALPA General Secretary, Brian Strutton, said:

“Good luck to the Condor staff and customers. But with UK holidaymakers stranded and 9,000 staff out of a job, the Thomas Cook directors need to explain why the UK airline had to be closed but the German one was allowed to continue to operate. How was it funded, because it seems there is nothing left in the coffers for UK staff? And why couldn’t the UK government give the same kind of bridging support as the German government when it was well known that Thomas Cook had a Chinese buyer lined up? It’s a national scandal.”

Condor made this announcement on social media:

4.900 Condor employees are more than thankful and would like to extend their gratitude to the government of Germany and the federal state of Hessen for granting the bridging loan. We want to thank our customers, partners and everyone else who supports Condor.

 

Thomas Cook Group to be liquidated, Thomas Cook Airlines UK stops flying, Condor continues to fly (for now)

Thomas Cook Group made this dramatic announcement today:

Further to the announcement made on September 20, 2019, Thomas Cook Group plc continued to engage with a range of key stakeholders over the weekend in order to secure final terms on the recapitalization and reorganization of the Company.

Despite considerable efforts, those discussions have not resulted in agreement between the Company’s stakeholders and proposed new money providers. The Company’s board has therefore concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect.

An application was made to the High Court for a compulsory liquidation of the Company before opening of business today and an order has been granted to appoint the Official Receiver as the liquidator of the Company. We anticipate that the Official Receiver will make an application to the High Court for members of AlixPartners UK LLP to be appointed as Special Managers in respect of the Company, to act on behalf of the Official Receiver, and we further anticipate that an order will be granted to that effect. As part of this process, a number of other Thomas Cook Group companies have also entered into compulsory liquidation, with members of either AlixPartners UK LLP or KPMG LLP (depending on the company) being appointed as Special Managers in respect of the relevant Group companies.

We expect that AlixPartners UK LLP will now work very closely with the Civil Aviation Authority in the UK, to effect the repatriation of all UK customers impacted by this announcement.

Peter Fankhauser, Chief Executive of Thomas Cook commented:

“We have worked exhaustively in the past few days to resolve the outstanding issues on an agreement to secure Thomas Cook’s future for its employees, customers and suppliers.  Although a deal had been largely agreed, an additional facility requested in the last few days of negotiations presented a challenge that ultimately proved insurmountable.

“It is a matter of profound regret to me and the rest of the board that we were not successful. I would like to apologise to our millions of customers, and thousands of employees, suppliers and partners who have supported us for many years. Despite huge uncertainty over recent weeks, our teams continued to put customers first, showing why Thomas Cook is one of the best-loved brands in travel.

“Generations of customers entrusted their family holiday to Thomas Cook because our people kept our customers at the heart of the business and maintained our founder’s spirit of innovation.

“This marks a deeply sad day for the company which pioneered package holidays and made travel possible for millions of people around the world.”

The Company has requested that its ordinary shares be suspended from listing on the premium segment of the Official List of the FCA and from trading on the main market of the London Stock Exchange with immediate effect.

Thomas Cook Airlines (UK) has made this announcement:

Thomas Cook has confirmed that all the UK companies in its group have ceased trading, including Thomas Cook Airlines.

As a result, we are sorry to inform you that all holidays and flights provided by these companies have been cancelled and are no longer operating. All Thomas Cook’s retail shops have also closed.

The Government and the Civil Aviation Authority are now working together to do everything we can to support passengers due to fly back to the UK with Thomas Cook between 23 September 2019 and 6 October 2019. Depending on your location, this will be either on CAA-operated flights or by using existing flights with other airlines.

If you are already abroad you will find all the information you need about your arrangements to get home on this website.

If you are due to depart from a UK airport with Thomas Cook Airlines, please do not travel to your UK airport as your flight will not be operating and you will not be able to travel.

This repatriation is hugely complex and we are working around the clock to support passengers.

Customers already abroad

If you are currently abroad and your flight was with Thomas Cook we are providing new flights to return you to the UK. These repatriation flights will only be operating for the next two weeks (until 6 October 2019). After this date you will have to make your own travel arrangements. From a small number of locations, passengers will have to book their own return flights.

For further advice and details of your return journey please read I am currently abroad. Please note that repatriation flights are only available for passengers whose journey originated in the UK.

If you are currently abroad and due to return to the UK after 6 October 2019, please read the additional information section.

Customers yet to travel out of the UK

We are sorry to inform you that all future holidays and flights booked with Thomas Cook are cancelled as of 23 September 2019.

If you are booked on a Thomas Cook Airlines flight, please do not go to your UK airport, as your flight will not be operating. The Civil Aviation Authority’s repatriation programme will not include any outbound flights from the UK.

If you choose to book a new flight with another airline out of the UK, you will not be eligible for a repatriation flight.

PLEASE NOTE: Some of Thomas Cook’s package holiday bookings include flights with airlines unrelated to the Thomas Cook Group.  If your return flight is not with Thomas Cook’s airline it may still be valid. However other elements of the package, such as accommodation and transfers might be affected.

Condor Flugdienst issue this statement:

All Condor flights are operating as scheduled.

Please find below information for our tour operator guests from: Thomas Cook, Neckermann, Oeger Tours, Air Marin and Bucher Reisen:

Condor has been informed by your tour operator that unfortunatly your flight will not be carried out as planned today or tomorrow. Therefore, it is with are sincerest apologies that we will not be able to accept on for your flight today.

Fosun Tourism Group acquires 25% of Thomas Cook’s airline divisions

Thomas Cook Group made this announcement on its agreement with the Fosun Tourism Group:

Thomas Cook Group plc is pleased to announce substantial agreement regarding key commercial terms between the Company, Fosun Tourism Group and its affiliates, the Company’s core lending banks and a majority of the Company’s 2022 and 2023 senior note holders. Implementation of the proposed recapitalisation will involve a significant new capital investment and reorganisation of the Group.

Key commercial terms and next steps include:

  • Fosun contributing £450 million of new money to the Group and acquiring at least 75% of the equity of the Group Tour Operator (subject to the receipt of anti-trust approvals) and 25% of the Group Airline;
  • The Group’s core lending banks and noteholders targeting in aggregate £450 million of new money to the Group and converting their existing debt into approximately 75% of the equity of the Group Airline and up to 25% of new equity in the Group Tour Operator;
  • Implementation commitment targeted for early October 2019.

The execution of the transaction remains subject to a legally-binding agreement being reached amongst the parties to the recapitalisation plan and, where appropriate, the Group’s other key stakeholders. The proposed recapitalisation plan does not impact trade creditors or customers.

In its announcement of July 12, 2019, Thomas Cook stated that shareholders may be given the opportunity to participate in the recapitalisation by way of investment alongside Fosun and converting senior creditors on terms to be agreed. The Board continues to proceed on the basis that a recapitalisation, achieved with the support of shareholders, is the preferred means of securing the future of the Group for all its stakeholders (including customers, suppliers and employees), while at the same time enabling the existing shareholders to continue to retain an investment in the Company. However, the recapitalisation is expected to result in existing shareholders’ interests in the recapitalised and reorganised Group Airline being significantly diluted, subject to feedback from creditors, the new money providers and other stakeholders.

In order to obtain the necessary creditor consents to the proposed transaction, the Group will today launch three inter-conditional creditor schemes of arrangement of Group borrower companies to seek creditor consent to amend certain terms of the 2022 and 2023 senior notes indentures (the “Notes”) and the 2017 revolving credit facility (the “RCF Agreement”).

The key objectives of the amendments being sought pursuant to the schemes are to amend the consent thresholds to amend material provisions in the RCF Agreement and the Notes, including in respect of releases of relevant principal debt and/or subsidiary guarantees, and to make certain other technical amendments to facilitate implementation of the proposed transaction.

The proposed recapitalisation remains subject to certain matters, including credit approvals, investment approvals, agreement on Group performance conditions, due diligence, agreement as to risk allocation amongst Fosun and Group creditors with respect to the bridge financing during transaction implementation, agreement between Fosun and the Group’s core lending banks and noteholders on the separation of the Group into Airline and Tour Operator and timely execution of the separation, reaching agreement with a range of the Company’s stakeholders (including fuel and foreign exchange hedging counterparties, the pension fund trustees, noteholders, other financial creditors and approval of Fosun’s shareholders), licence renewals and receipt of regulatory and anti-trust clearances and approvals.

The current intention of the Board is to maintain the Company’s listing. However, the implementation of the proposed recapitalisation may, in certain circumstances, result in the cancellation of the Company’s listing.

Reflecting the extensive progress made on agreeing key commercial terms with the Group’s core lending banks and noteholders regarding the injection of £450 million of new money into the business in connection with the proposed recapitalisation, the mandate letter and term sheet for a £300 million secured bank financing facility announced in May 2019 will be allowed to lapse.

Given the substantial agreement regarding the commercial terms of the proposed recapitalisation, the Company has also agreed a cost cover arrangement with Fosun, a related party, with respect to the costs and expenses incurred by Fosun with any professional advisors in evaluating and negotiating the proposed recapitalisation. The maximum costs to be covered by the Company under this arrangement shall not exceed an amount equal to £5.43 million (less any amounts paid by the Company to Fosun during the past 12 months). The cost cover is payable on a weekly basis beginning 12 July 2019 and ending on 30 September 2019 (with the period accrued to date being paid retrospectively), unless terminated sooner in accordance with its terms, and is subject to certain milestones being reached in connection with the proposed transaction. This arrangement falls within Listing Rule 11.1.10R and this announcement is made in accordance with Listing Rule 11.1.10R(c). Arrangements have also been made to meet the reasonable adviser costs of its core lending banks, bondholders, and other appropriate stakeholders in connection with the proposed recapitalisation.

Note: The Thomas Cook Group airlines include:

Thomas Cook Airlines (UK)

Thomas Cook Airlines (Balearics)

Thomas Cook Airlines (Scandinavia)

Condor Flugdiest

Thomas Cook Airlines (UK) aircraft photo gallery:

Thomas Cook Group will offer a larger fleet for the Summer 2019 schedule, Thomas Cook to introduce new “flat beds”

Condor Flugdienst-Thomas Cook Airbus A321-211 WL D-AIAG (msn 6590) AYT (Andi Hiltl). Image: 945978.

The Thomas Cook Group made this announcement:

•Group Airline with a total of four additional short- and medium-haul aircraft compared to summer 2018
•Three further Airbus A321s in service for Condor as of early summer, one additional A321 to take-off for Thomas Cook Airlines UK
•105 aircraft in UK, Scandinavia, Spain and Germany

The Thomas Cook Group Airline is taking delivery of two additional Airbus A321 aircraft, which will be added to the Condor fleet for the 2019 summer flight schedule. The jets will be in service for Thomas Cook Airlines UK from winter 2019/20 afterwards. The Group Airline recently announced to include two further Airbus A321 for summer 2019, and will have a total of 105 aircraft then. Its short- and medium-haul fleet has been expanded by four additional own aircraft in total compared to the previous year.

Two Airbus A321s fly for Condor and are stationed in Leipzig and Hanover in summer 2019. In Leipzig, Condor is significantly increasing capacity with around 100,000 additional seats to the Mediterranean, the Canary Islands, Turkey and Egypt. Another A321 is flying in Germany as well, the fourth airplane completes the A321 fleet of Thomas Cook Airlines UK.

The fleet growth is a clear sign for the Group Airline’s focus on operational stability during high season: “Using additional aircraft of our own is another measure to live up to our quality promise next summer, even during the high season”, says Christoph Debus, Chief Airline Officer of the Thomas Cook Group. With the additional aircraft, the Group Airline has further reserves available and has hired additional personnel on the ground and in the air. As part of an internal project, numerous other measures were implemented to ensure stable flight operations in the summer of 2019.

In other news, Thomas Cook Airlines (UK) on May 13 will introduce “flat beds” for its long-haul routes to the USA.

Video:

Top Copyright Photo: Condor Flugdienst-Thomas Cook Airbus A321-211 WL D-AIAG (msn 6590) AYT (Andi Hiltl). Image: 945978.

Condor aircraft slide show:

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Thomas Cook Group will consider selling its airline division

Thomas Cook Airlines (UK) (SmartLynx Airlines Latvia) Airbus A320-214 LY-LCO (msn 1873) PMI (Ton Jochems). Image: 945605.

The Thomas Cook Group has stated it is conducting a review of its airline division. The group wants to concentrate more on its hotels division.

The group also stated it would consider all options including a possible sale of the individual airlines.

The Thomas Cook Group airline division consist of three sun and beach focused leisure airlines: Thomas Cook Airlines UK, Thomas Cook Airlines Scandinavia, the German airline Condor Flugdienst GmbH and Thomas Cook Airlines Balearics.

The group issued this full financial report:

Fiscal first quarter trading statement for the three months ended December 31, 2018:

2018/19 started in line with expectations; strategic review of airline announced

HIGHLIGHTS1

  • First quarter revenue up 1% to £1,656 million2
  • Q1 underlying operating loss increased by £14 million to £60 million against a strong prior-year period – loss from operations on a reported basis increased £7 million reflecting lower separately disclosed items
  • Strategic review of Group Airline to increase financial flexibility and accelerate execution of our core strategy

1. Comments are based on like-for-like comparisons

2. Includes adjustment for IFRS 15 accounting change for Group Airline and residual amounts relating to the transfer of the Thomas Cook Airlines Belgium to Brussels Airlines and as such is no longer part of the Group

Peter Fankhauser, Chief Executive of Thomas Cook commented:

“As expected, the knock-on effect from the prolonged summer heatwave and high prices in the Canaries have impacted customer demand for winter sun. Where Summer 2018 bookings started very strongly, bookings for Summer 2019 reflect some consumer uncertainty, particularly in the UK, and our decision to reduce capacity which will both mitigate risk in our tour operator business and help our airline to consolidate the strong growth achieved last year.

“We’ve made further good progress in transforming our business with a rigorous focus on managing our cost base while innovating to deliver high-quality holidays for our customers. Our strategic alliance with Expedia is now live in all our key markets. In addition, we are set to open 20 new own brand hotels this summer, including three Casa Cooks and eight Cook’s Clubs, and have announced two new hotel projects with Fosun in China.

“At the same time, we recognise that we need greater financial flexibility and increased resources to accelerate the execution of our strategy of differentiation: to invest in strengthening our own-brand hotel portfolio; further digitising our sales channels; and driving greater efficiencies across the business. As a result, we are today announcing a strategic review of our Group Airline. We are at an early stage in this review process which will consider all options to enhance value to shareholders and intensify our strategic focus. We will provide an update on this process in due course.”

FIRST QUARTER PERFORMANCE

Group revenue was broadly unchanged in the first quarter, rising by 1% on a like-for-like basis to £1,656 million, led by strong customer demand for Turkey and North African destinations, offsetting weaker demand for Spain.

Gross margins were lower, reflecting a continuation of the highly competitive market conditions in the UK at the end of the summer season, and weaker demand for winter holidays in the Nordics.

As a result, the Group’s seasonal underlying loss from operations increased by £14 million on a like-for-like basis to £60 million. Currency translation movements during the quarter led to an impact of £4 million. On a reported basis, our loss from operations increased by £7 million, reflecting an improvement in separately disclosed items. The seasonal loss was led by the Group Tour Operator where a weaker performance in the UK and Northern Europe was partially offset by a good performance in Continental Europe. Our Group Airline continued to perform well, delivering a seasonal underlying loss in line with a strong comparative period last year.

Financial position

Net debt at December 31, 2018 was £1,588 million. The Group has kept a healthy level of liquidity headroom over the important winter cash low period, maintaining a minimum buffer within our targeted range of £150 million to £200 million. In addition, our bank covenant tests as at 31 December 2018 were met.

CURRENT TRADING AND OUTLOOK

Winter 2018/19 

Trading for the Winter 2018/19 season is largely unchanged from the last update. Total bookings are up 8%, supported by higher volumes in the Group Airline as a result of the full season impact of extra aircraft acquired last spring. We continue to see strong demand for Turkey, Egypt and Tunisia as customers seek alternatives to high hotel prices in the Canary Islands. However, average selling prices are 10% lower overall, reflecting a higher mix of short and medium-haul airline volumes.

Group Tour Operator bookings are down 2%, with pricing 3% lower. Bookings from the Nordics and Continental Europe are lower than last year, in line with reductions in capacity. In the UK, charter risk bookings are in line with last year.

For the Group Airline, overall bookings are 8% ahead, in line with capacity increases. Bookings to short and medium-haul destinations are up by 10%, largely as a result of a growth in demand for Egypt. Long-haul bookings are up 3% with good demand for USA and Caribbean. Overall airline pricing is down 3% due to the mix effect of a shift towards short and medium-haul flying.

Summer 2019

Our Summer 2019 program is 30% sold, slightly ahead of last year. Group Tour Operator bookings are consistent with the capacity reductions we have made across our markets to closely manage our risk capacity throughout the year. As a result, tour operator bookings are down 12%, helping to support pricing, which is up in all key segments, and 4% higher overall.

Group Airline bookings are below last year, as we have selectively reduced capacity in short and medium-haul destinations by taking in less wet-lease capacity. This is partially offset by good growth in demand to long-haul destinations. Average selling prices are up 6%, with higher yields in both short and medium-haul and long-haul.

Outlook

We are addressing some of the challenges we faced in Summer 2018 by reducing our committed airline capacity for 2019 and increasing the focus on high quality, higher-margin hotels and destinations. In addition, we continue rigorously to drive down costs to give us greater operational flexibility, while remaining fully focused on our strategy, and managing our financial and commercial commitments.

We are making no changes to the full-year expectations set out in November 2018, reflecting the early stage in the year and limited visibility due to wider market uncertainty, particularly in the UK.

INTENSIFYING STRATEGIC FOCUS

Thomas Cook Group has undergone significant transformation over the last five years as we have streamlined our operations and focused on a clear strategy in both our Airline and Tour Operator businesses.

However, it is clear that we need greater financial flexibility and increased resources to accelerate the execution of our strategy of differentiation: to invest in strengthening our own-brand hotel portfolio; further digitising our sales channels; and driving greater efficiencies across the business. As a result, we are today announcing a strategic review of our Group Airline. We are at an early stage in this review process which will consider all options to enhance value to shareholders and intensify our strategic focus. We will provide an update on this process in due course.

Our strategy for the airline has been to profitably grow as a leading European leisure airline with a reliable, customer-focused service. This has involved a continuous review of our cost structure in order to stay competitive in a highly fragmented market. We currently operate a fleet of 103 aircraft, of which a quarter serve long-haul destinations. Our Group Airline delivered strong growth in 2018, despite facing industry-wide disruption.

We made good progress in strengthening our seat-only offer, and growing services to third-party tour operators. We carried over 20 million passengers and generated £3.5 billion in revenue, with underlying operating profits growing 37% year-on-year to £129 million.

Top Copyright Photo: Thomas Cook Airlines (UK) (SmartLynx Airlines Latvia) Airbus A320-214 LY-LCO (msn 1873) PMI (Ton Jochems). Image: 945605.

Thomas Cook (UK) aircraft slide show:

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Thomas Cook Airlines UK retires its last Boeing 757, becomes all Airbus

Type Retired: January 6, 2019 (flight TCX 385 Hurghada - London Gatwick with G-JMAA)

Thomas Cook Airlines (UK) has operated its last Boeing 757 revenue flight.

The pictured Boeing 757-3CQ G-JMAA (above) operated flight TCX 385 from Hurghada, Egypt to London (Gatwick) on January 6, 2019. The airliner is due to be transferred to Condor.

Sister ship G-JMAB, which was retired first, was ferried to Frankfurt on January 8, 2019.

The British airline is now all Airbus (above).

Top Copyright Photo: Thomas Cook Airlines (UK) (Thomas Cook.com) Boeing 757-3CQ G-JMAA (msn 32241) PMI (Ton Jochems). Image: 945293.

Thomas Cook aircraft slide show:

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