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Thomas Cook H1 Loss Widens; Sees Further Headwinds In Remainder Of Year

British tour operator Thomas Cook Group Plc. (TCKGY.PK,TCG.L) reported Thursday that its first-half loss before tax was 1.46 billion pounds, wider than last year's loss of 303 million pounds.

The wider loss reflected goodwill impairment of 1.104 billion pounds in UK business, related to the merger with MyTravel in 2007 which the company has re-valued in light of the weak trading environment.

Loss from Operations or EBIT, excluding goodwill impairment, was 282 million pounds, wider than loss of 215 million pounds a year ago.

Underlying EBIT was 245 million pounds, compared to loss of 170 million pounds last year, reflecting margin pressure in Tour Operator.

Revenue for the period declined to 3.02 billion pounds from last year's 3.23 billion pounds. On a like-for-like basis, revenues increased.

Regarding its current trading, the company said that trading has been challenging to date, reflecting an uncertain consumer environment which has led to a slower pace of bookings across all markets.

The company now expects underlying EBIT in the second half to be behind the same period last year although, as previously advised, operating profit will reflect significant reductions in separately disclosed items.

Peter Fankhauser, Chief Executive, said, "As we look ahead to the remainder of the year, it's clear that, notwithstanding our early decision to mitigate our exposure in the 'lates' market by reducing capacity, the continued competitive pressure resulting from consumer uncertainty is putting further pressure on margins. This, combined with higher fuel and hotel costs, is creating further headwinds to our progress over the remainder of the year."

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