- Sep 23, 2009
Thank you. Not the news I was hoping for
Fontenla-Novoa steps down from Thomas Cook
3 August 2011 | By Rob Gill
Thomas Cook Group has announced today that chief executive Manny Fontenla-Novoa is to step down from his role with immediate effect.
Sam Weihagen, currently Fontenla-Novoa’s deputy, will take on the role of interim group chief executive. Cook said a search process is underway “to identify a permanent successor and an announcement will be made in due course”.
Cook chairman Michale Beckett said: “The board would like to thank Manny for his contribution to the group. He leaves with our very best wishes for the future.
“In Sam Weihagen, we have a highly successful and experienced executive and the board has every confidence in his ability to lead the group until a new CEO is appointed.”
Fontenla-Novoa said: “Thomas Cook and its people have a sound heritage and I have been proud to have been part of the company.”
Cook has seen its shares plunge by nearly 50% since it issued a profits warning on July 12 and Fontenla-Novoa’s management of the company has been questioned by investors and city analysts.
Fontenla-Novoa, 57, has been Cook’s chief executive since 2007 when the company merged with MyTravel. He was previously a founding director of Sunworld and first joined Cook in 1996 when it purchased Sunworld.
Unfortunately, I cannot see APD being reduced - more likely it'll be increased.It just goes to show aviation tax (APD) isn't working with P&O Cruises cutting back long haul flights and now Thomas Cook following suit. Other airlines have revised their long haul plans, Monarch Airlines and Jet2 among the list of other airlines that have scaled back their long haul ambitions.
Cameron asks for report on Thomas Cook
Prime minister David Cameron has asked for the government’s business department to provide a report on Thomas Cook.
Cameron was asked about the beleaguered tour operator during today’s prime minister’s questions in the Houses of Commons by Peterborough’s Conservative MP Stewart Jackson.
He replied: “I have obviously asked the business department to give me a report on what is happening in terms of Thomas Cook because I think it is important to make sure that this business is in a healthy state.”
Cameron also called Cook an “iconic and important British business which has given people a lot pleasure over the years”.
Jackson said he was asking the question on behalf of the 1,600 staff based at Cook’s headquarters in Peterborough who were concerned about media coverage of the operator’s “difficulties” over the last two days.
“People can support the company by booking through Thomas Cook safe in the knowledge that they are protected by the Atol scheme and will have an excellent holiday to boot.”
In a separate development, it has been reported that business consultancy Ernst & Young has been appointed by Cook’s banks which has been interpreted as a sign that there could be a restructuring of the company.
Thomas Cook heading for restructure?
Thomas Cook is being tipped for a major financial restructuring after asking its banks for a new loan facility this week.
The struggling tour operator saw its shares collapse by 75% on Tuesday in the aftermath of the announcement that it was postponing its annual results - originally due out today - as it conducted talks with its banks about securing another £100 million facility to see it through the end of the year.
This group of 17 banks has now reportedly hired accountancy firm Ernst & Young to advise them on their options regarding Cook which analysts believe could include a major restructuring. Although the banks are thought unlikely to want to take control of the company.
Cook’s shares stabilised on Wednesday - at one point they were up by more than 25% - before closing at 11p on the London Stock Exchange which was an increase of 9% on Tuesday’s close. The shares rallied again in early trading on Thursday when they rose by more than 20% to around 14p.
But the shares are still down 73% on the closing price of 41p on Monday before the company dropped its bombshell to the City on Tuesday morning.
During Tuesday’s massive sell-off, Cook’s biggest shareholder Lloyds Banking Group also cut its 8.96% stake to less than 5%.
Lloyds is included in the syndicate of Cook’s lenders but its shareholding in the company is through its Scottish Widows subsidiary.
Trade reassured after insurance suspended on Thomas Cook flight-only
Advantage has rushed to reassure the trade after it emerged that insurance on Thomas Cook’s flight-only sales had been temporarily suspended.
The suspension means that anyone selling Thomas Cook seats on an Atol-to-Atol basis or as part of a dynamic package, will not currently be protected by scheduled airline failure insurance (Safi).
Advantage leisure director Julia Lo Bue-Said said the consortium had received a letter from Northern and Western Insurance Company on Tuesday confirming that the insurance would be temporarily withdrawn.
However she said: “This is a really small part of the overall business. I would reassure the trade not to be worried by this.”
Thomas Cook Group Plc
Amendment to existing bank facilities and new £200m bank facility signed
Thomas Cook Group is pleased to announce that we have reached agreement with our banking group to provide the Group with a new facility that significantly improves the robustness of the Group’s financial position.
Our banks, led by Barclays, HSBC, RBS and UniCredit, have agreed to provide a new £200m facility available until 30 April 2013, which replaces the £100m short-term facility announced on 21 October 2011. In addition, they have agreed a further relaxation of the financial covenants under the existing facilities. This provides the Group with much increased headroom to deal with unexpected events and the effects of an uncertain economic environment.
As previously announced, the Board is taking steps to reduce the Group’s debt and reach a more appropriate capital structure over time. The Group will also undertake a strategic review.
The Group will announce its preliminary results for the twelve months ended 30 September 2011 during the week commencing 12 December 2011.
Sam Weihagen, Group Chief Executive, Thomas Cook Group plc said:
“I am absolutely delighted that we have reached agreement and I would like to thank the banks for acting so swiftly. Over the last few days, we have been overwhelmed by the messages of support from our holidaymakers, suppliers and partners and I would like to thank them for their good wishes and our employees for their hard work and dedication. For over 170 years Thomas Cook has provided customers across the world with fantastic travel experiences. Today they can look forward confidently to holidays with us for many years to come.”
It could be seen as January is probably the quietest time of the year so it would be a time when the aircraft is least neededConcorde Lover said:I Think Channex 757 that it will be having maintenance and checks done before the summer seasons begins and when the majority of aircraft will be needed, although i can't exactly state what checks could the aircraft be having done.
Cook aircraft sales to raise £182.9m
Thomas Cook has agreed to sell or lease back 17 aircraft, which is expected to raise £182.9 million.
The company said it would sell and lease back 11 Boeing 757 aircraft with Guggenheim Aviation Partners and six Boeing 767 aircraft with Aircastle Advisor International Limited.
Guggenheim has also agreed in principle to enter a sale and leaseback agreement for a further two Boeing 767 aircraft.
Thomas Cook said it expected to raise £126.1 million from the sales to Guggenheim and £56.8 million for the sale of the six Boeing 767s to Aircastle.
All of the money from the aircraft sales will be retained by the company, which it said would “add to the group’s headroom of cash and available facilities”.
Sam Weihagen, chief executive of Thomas Cook Group plc, said: “Today’s announcement demonstrates the progress which we continue to make to strengthen the Group’s financial position, with the aircraft disposals providing substantial additional liquidity.
“As expected, the first half seasonal losses have widened however, summer bookings have improved in recent weeks.”
Thomas Cook has been disposing of assets in order to reduce its debt.
This has already seen it part with hotels in Europe and put its Thomas Cook India subsidiary up for sale.