Thomas Cook shares Fall

  birdface 09:29 22 Nov 11
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Another holiday firm in trouble.

Their shares fell 50% this morning because of the Money that they owe.

So not sure how they will get out of it.

I am sure they have been in trouble before and managed to Survive but a 50% share drop is massive to a company like that.

I have never used a travel company before and never been abroad so I know not a lot about travel company's but just thought that if any one was thinking about going away at this time of year you would want your payments to be in safe hands.

  birdface 09:33 22 Nov 11
  morddwyd 10:02 22 Nov 11

I think the writing was on the wall when the Co-op took over its high street shops, yes, I know it was a "merger" but we all know what that means!

  Al94 10:54 22 Nov 11

The classic signs of the imminent collapse of a business are evident.

  birdface 11:09 22 Nov 11

I suppose it has to hit Holiday firms hard.

Everyone tightening their purse strings ,Fewer holidays because of the recession and lack of work.

Everything going bad for big company's like Thomas Cook at the moment.

A lot of folk booking their holidays through the Internet as they can get them cheaper that way.

Not looking good for them and can't see things improving in the next few years.

Lets hope that they can survive but I suppose it is up to the banks so do not fancy their chances.

£900.000.000 in debt at the moment according to some reports so I can't see the Banks bailing them out for much longer.

  sunnystaines 13:17 22 Nov 11

use TC a lot for holidays as they always undercut others, but recently they have been unable to match first choice prices or those from other companies. Also the TC cedit card has cut all the perks, first of all the no surcharge on using the card now no longer able to cash in the reward points for foriegn cash only discounts on TC holidays which are now overpriced compared to elsewhere, so as most of their w customers ill move elsewhere for a better deal I can only see TC going bust a big shame as their staff in our local branch are helpful.

  birdface 17:42 22 Nov 11

Maybe not as bad as we were thinking.It has been hinted that they have made a profit for this year and it will be announced in the next few days.

So maybe their shares will rise again when that is announced.

No doubt the shares will bounce back a bit when it is announced so maybe a few pennies to be made for those that deal in stocks and shares.

  Forum Editor 18:56 22 Nov 11

This all started back in July, when the company issued a profits warning. Whenever a big company like this issues such a warning the City of London tends to get all dramatic about it.

Imagine yourself as an investment banker. Thomas Cook issues a profit warning, and within hours your phone rings off the hook - it's concerned investors calling to say 'sell my Thomas Cook shares as quick as you can!' You sell the shares, lots of other brokers do the same, and before you know it the value of said company has been slashed. That's exactly what happened in July - the Thomas Cook share price fell by 26%. The business was still trading profitably, and its value covered its debts (just), so there was no need for a panic, but that's what happens when investors get the jitters.

It's happened again because the company wants to increase its borrowing limit. Times are tough in the travel industry, and Thomas Cook's directors want to ensure that they have a bigger cash buffer to tide the business over. It is not currently in default on any of its loan agreements, so there is no immediate need for panic. The one thing that would make matters worse is if the share price stayed where it is for very long, and what could make that happen is jittery investors. If ever there was a time for courage on the part of the market it's now.

  morddwyd 19:42 22 Nov 11

"If ever there was a time for courage on the part of the market it's now."

The market is not known for its courage, particularly in times like these!

  Autoschediastic 05:25 23 Nov 11

"HOW" Does a travel company get into this state? had it of been a financial institution of some form we would be expected to accept these figures but a holiday company come on? where is all their money going? they are expensive and must make a decent mark up on their charges?

i have been a holiday repp a few years ago and worked with the likes of Harry Shaw (Coventry) Siesta & Club Cantabrica as well as redcrest too & i know these tour operators really make a killing from holiday makers and when you look at the vast scope of holiday makers who use Thomas Cook its hard to absorb how the hell they got into this situation? 75% of the value of the company gone?

Almost a BILLION pounds in debt if they get the loans? they simply wont be able to climb out of this hole from that angle what i would do is look at selling off an "Arm" of the business or somehow consolidate but to keep borrowing into the hundred million pound mark is Suicide for TC

  zzzz999 07:23 24 Nov 11

Thomas Cook is a global business and has suffered across the globe. Much of its business has been affected by political unrest (North Africa) or natural disaster (Thailand), ally that with straightened times and you can see why it would need to ask its bankers for increased working capital.

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