Thomas Cook

All, 

It’s bad news.

Losses have widened, but more importantly:

Thomas Cook are conducting a “strategic review” of the airline business. 

This is like selling the profitable, but strategically limited business to invest in the turnaround of the larger strategically dominant business.

It is possible that the sale will only involve the long-haul routes, as they are not an obvious strategic fit with the tour business. But the underlying message that TC are in trouble is clear.

Traditionally TC trades very soft as uncertainty from year to year takes a long time to be met with hard data. Depending on the use of proceeds of the airline sale I expect bonds to drop deep. 

Tomas is the analyst.

Wolfgang