Will Thomas Cook Turn the Corner and Swing Back in the Black?

German-owned Thomas Cook expects for the first time in four years to turn the corner and return to profit in 2005. The travel group evidently saw Winter pre-tax losses cut to euros 244.2 million in the six months to April from euros 385 million a year earlier.

Thomas Cook U.K. & Ireland, which has implemented cost-cutting initiatives, expects this year´s profits to exceed last year´s figure of euros 51 million due to a continued focus on improving profit margins.

“2005 has seen a healthy market for package holidays, with supply and demand more closely balanced than ever across the travel industry,” said Manny Fontenla-Novoa, U.K. & Ireland Chief Executive Officer.

“As a result there is less excess capacity to be sold off cheaply, leading to a higher average holiday price. Resulting profit margins are therefore stronger and UK businesses are performing well.”

A spokesperson has apparently explained that Thomas Cook strives to have the lowest cost base of all the major travel companies, and due to streamlining its business and becoming faster to respond to changes in the travel market has successfully confronted challenges, such as war in Iraq and rising fuel costs.