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Cautious outlook from Thomas Cook

Cautious outlook from Thomas Cook
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There was mixed news from tour-operator Thomas Cook on Thursday.

We remain cautious, given the uncertain political and economic outlook around the globe

Peter Fankhauser Thomas Cook Chief Executive

Its bookings for the summer were up on last year, but it remained cautious about the rest of 2017.

“We have made a solid start to the year, but it is still early days, and we remain cautious, given the uncertain political and economic outlook around the globe,” Chief Executive Peter Fankhauser said.

The world’s oldest holiday company said nearly a third of its summer holidays have been sold, with bookings nine percent ahead of this time last year.

With security issues continuing to reduce demand for holidays in places like Turkey and Egypt, Thomas Cook has expanded its offerings in Greece and other European countries such as Portugal, Cyprus, Bulgaria and Croatia.

Britain’s planned exit from the European Union is another uncertainty factor, along with new US President Donald Trump, but the company said it is on track to meet market expectations for its full-year operating profit.

Investors were not impressed however and the shares fell by as much as 10 percent at one stage on Thursday and finished the session down 7.7 percent. They lost nearly 30 percent of their value last year.

Pay row

More than a fifth of Thomas Cook’s shareholders voted against the board’s planned pay awards for directors at the firm’s Annual General Meeting.

The Directors’ Remuneration Policy was rejected by 21.68 percent of shareholders including Standard Life Investments, the company’s second-biggest investor.

The biggest revolt came over an alternative payment plan called the Strategic Share Incentive Plan (SSIP), where 32.7 percent went against the board.

The plan could have given chief executive Peter Fankhauser a bonus of 225 percent of his annual salary.

Faced with the rebellion, Thomas Cook said it would not use the SSIP in the current financial year and would consult with shareholders before activating it.