Online travel booker On the Beach Group PLC (LON:OTB) is working to help its customers who are currently on holiday and had booked return flights with Thomas Cook Airlines Ltd, which along with other Thomas Cook Group PLC (LON:TCG) entities have entered compulsory liquidation.
OTB, in statement, said: “The board anticipates that there will be a one-off exceptional cost associated with helping customers to organise alternative travel arrangements, and lost margin on cancelled bookings.”
READ: Thomas Cook collapses as rescue attempts fail
The company said it expects to recover the costs of the cancelled flights via chargeback claim, noting that this was the case following the 2017 failure of Monarch.
It will book the one-off exceptional cost to the current financial year.
“The board is currently evaluating the potential effects of the failure on its forecasted performance for the year ending 30 September 2020, and a further update will be provided when appropriate,” OTB added.
READ: On the Beach scorched by Brexit-inspired profit warning
A full-year trading update for the twelve month’s ended 30 June is due on 22 October and preliminary financial results are slated for 27 November.
Last month, OTB delivered a Brexit-inspired profit warning. In a trading update, the online holiday firm said that a fall in the value of sterling over the summer as fears of a no-deal Brexit intensified had forced it to raise prices, which had, in turn, made it “difficult” to gain market share while also maintaining its margins.
As a result, the company said it now expected its full-year performance to be below management expectations.
Thomas Cook collapses leaving customers in the lurch
Thomas Cook Group PLC (LON:TCG) has gone bust after a last-ditch attempt to secure a rescue deal for the world’s oldest travel agent collapsed over the weekend.
The group had seemed to be close to securing a £900mln rescue deal for its tour operator and airline businesses, propped up by a £450mln cash injection from its largest shareholder, Chinese giant Fosun, and a consortium of banks and other lenders.
However, the agreement was thrown into doubt on Friday after a number of banks, led by Royal Bank of Scotland PLC (LON:RBS) and Lloyds Banking Group PLC (LON:LLOY), demanded Thomas Cook find an extra £200mln to keep itself afloat over the traditionally quieter winter period.
This proved to be too much for the company, which on Monday announced to the market that it would enter liquidation proceedings, putting 22,000 jobs at risk worldwide and scuppering travel arrangements for 150,000 customers.
Peter Fankhauser, Thomas Cook’s chief executive, said it was a matter of “profound regret” that the company had been unsuccessful in securing a rescue deal, adding that the additional funding demanded last week had proved an “insurmountable” challenge for the 178-year old business.