Thomas Cook commits to hold adspend as shares crash

Thomas Cook: 2009/10 Redknapps campaign
Thomas Cook: 2009/10 Redknapps campaign

Thomas Cook's interim chief executive has said its advertising spend will not be affected by a deterioration in trading that has prompted it to ask its banks for more money and its share price to plummet more than 50%.

The beleaguered travel operator was set to announce its full year results and an update on the review of its UK business on Thursday (24 November).

However today it delayed the announcements and admitted it was in discussions with its principal leading banks to secure a cash injection of "around about" £100m because of the poor trading. The sum is in addition to the £100m lent to Thomas Cook last month by the banks.

Sam Weihagen, interim chief executive at Thomas Cook Group, said the operator's financial status will not affect upcoming ad spend or its planned post-Christmas campaign, expected to launch on Boxing Day (26 December).

The operator is on the back foot after rival TUI Travel surprised the industry last month by releasing a £5m ad campaign for Thomson Holidays, breaking from the traditional post-Christmas push.

Thomas Cook's £12.2m advertising spend between October 2010 and September 2011 was heavily weighted to January (£5.6m), February (£1.3m), April (just under £1m) and May (£1m), according to Nielsen figures.

Weihagen said the company is operating "as usual", adding that customers who are concerned about holidays booked with the brand "should not worry at all", adding that Thomas Cook's holidays have the same travel protection as other operators.

Paul Hollingworth, the chief financial officer, said Thomas Cook was in a "seasonal low period".

He admitted that the company's new joint venture with Russia's VAO Intourist got off to an "extremely poor start", which, coupled with ongoing turmoil in Tunisia and Egypt, has affected bookings.

Thomas Cook has over 30,000 employees across the whole group, which includes The Co-operative Travel group following the two operators' merger in August.

In the past year Thomas Cook has issued three profit warnings and parted company with its chief executive, Manny Fontentla-Novoa.

Yesterday it announced the closure of 200 high-street shops.

Follow Loulla-Mae Eleftheriou-Smith on Twitter @LoullaMae_ES

Discussion

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Brand Republic Jobs

subscribe now

Latest

Oasis #springasmile digital campaign gets people doing good deeds
Coca-Cola: 'Don't approach bloggers with a fait accompli'
Tesco CMO Matt Atkinson: 'It is so important not to stereotype mothers'
McDonald's gives Ronald a new look ahead of global 'Fun times' social media push
In pictures: BrewDog opens first craft beer shop BottleDog for 'beer aficionados'
Facebook ad revenue leaps $1bn as it invests in targeting
Malteser or Maltesers? Mars takes Hershey trademark dispute to court
Apple Q2 profits top $10bn as iPhone sales soar
Lynx tells men not to leave love to fate
HBO captures awkwardness of watching sex scenes with parents
Primark to open first US stores with Boston chosen as flagship location
Marketing spend on the up but a reality check is needed before celebrating
Top 10 ads of the week: Jackpotjoy and BT Broadband fend off Kevin Bacon
Lidl beats Tesco to 10m Facebook fans
Center Parcs ad banned for encouraging parents to take kids out of school
Coca-Cola, Cadbury and Amazon named top brands for targeting youth market
Leaked document shows Nokia to be rebranded as Microsoft Mobile
Nike lays-off hardware staff in move that casts doubt on future of FuelBand
Greenpeace says save the bees or humans will die
What brands need to know about changes to VAT and online downloads in 2015
Jimmy Savile victims urged to claim compensation in new ad campaign
UKIP launches biggest  ad campaign and stirs up 'racist' accusations
Apple boss Tim Cook provides voiceover on ad touting firm's renewed green commitments
John Lewis walks consumers through its history to celebrate 150 years of business
Waitrose boosts content strategy with 'Weekend Kitchen with Waitrose' C4 tie-up
Hottest virals: Cute puppies star in Pedigree ad, plus Idris Elba and Fruyo
Amnesty International burns candles to illuminate new hope
Tom of Finland's 'homoerotic' drawings made into stamps
Toyota achieves the impossible by calming angry Roman drivers
YouTube reveals user habits to appeal to 'older' marketers