Thomas Cook posts profits warning – blaming the British heatwave this summer
The company expects to deliver full-year underlying operating profit of about £280 million, down from previous estimates of £323 million
HOLIDAY giant Thomas Cook has warned that its profits have been hit by the European heatwave and a fall in demand for last-minute trips abroad.
The firm said that the "unprecedented" prolonged period of hot weather across the continent meant more people spent June and July enjoying the sunshine at home and put off booking holidays abroad.
A slowdown in customer bookings during June and July extended into August, which meant the company slashed its prices on late summer holidays, which exacerbated pressure on profit margins.
As a result, Thomas Cook now expects to deliver full-year underlying operating profit of about £280 million, down from previous estimates of £323 million.
Shares plunged by nearly 25 per cent at the market open to 57.9p as investors digested the news.
Thomas Cook makes all of its annual profits in the summer months and also warned that the impact of the heatwave "is continuing to be felt into winter trading".
Boss Peter Fankhauser said: "Summer 2018 has seen a return to popularity of destinations such as Turkey and Tunisia.
"However, it has also been marked by a prolonged period of hot weather across Europe.
"This meant many customers spent June and July enjoying the sunshine at home and put off booking their holidays abroad, leading to even tougher competition and higher than usual levels of discounting in the 'lates' market of August and September.
"Our recent trading performance is clearly disappointing."
The slow business does mean that Thomas Cook is continuing to slash its prices on last minute holidays though, with several bargains to be had.
They are offering holidays to Greece including flights and accommodation from £147pp - .
Alternatively, there are holidays to Tenerife from £190pp, and holidays to Turkey from £208pp
The company has also spent the late summer dealing with the deaths of two Brits at the Steigenberger Aqua Magic Hotel in Hurghada, which they booked through Thomas Cook.
Tourists John and Susan Cooper are suspected to have died from E.coli poisoning at the hotel in Egypt on August 21.
The couple, from Burnley, Lancs, died within hours of each other.