Thomas Cook warns on impact of Egypt, Tunisia turmoil
Thomas Cook, one of Europe's biggest tour operators, warned on Tuesday that political unrest in Egypt and Tunisia would cost the group about £20 million (24 million euros, $33 million).
"The political unrest in Tunisia and Egypt will have an impact on the group results," the London-based company said in a trading update.
"All travel to these markets is currently restricted with the exception, in line with UK Government advice, of travel from the UK to Red Sea resorts.
"We are pleased to note that the UK dovernment travel advice to Tunisia has now improved.
It added: "We estimate the unrest will have an impact on our second quarter profits of around £20 million."
Revenues in the group's first quarter, or three months to the end of December, increased by seven percent to 1.81 billion pounds.
The group meanwhile cut its loss by 10 percent to 37.3 million pounds in the reporting period, which covers the seasonally slower months of the year.
Tuesday's news comes after rival TUI Travel predicted last week that Egypt and Tunisia turmoil would cost it up to £30 million.
"Thomas Cook seemed to have managed the crises in Egypt and Tunisia a lot better than its rival TUI Travel, as it reported a smaller loss," said ETX Capital trader Manoj Ladwa.
Many travel companies have cancelled trips to Egypt amid violent protests aimed at ousting President Hosni Mubarak. However, resorts along the Red Sea have not been affected by the heavy turmoil.
Groups were meanwhile forced to evacuate thousands of holidaymakers from Tunisia last month, as a wave of unrest forced the country's president from power.
"The situation in Tunisia and Egypt is fast-moving and our principal concern is for the well-being and safety of our customers," added Thomas Cook Chief Executive Manny Fontenla-Novoa in the earnings release.
"We continue to monitor the situation closely and contingency plans have been implemented to redirect our holiday programme to other destinations and help mitigate the financial impact."
© 2011 AFP