Page last updated at 06:40 GMT, Thursday, 13 August 2009 07:40 UK

Swine flu bill hits Thomas Cook

Thomas Cook branch
The firm has scaled back the number of hoildays it is selling demand

Travel firm Thomas Cook has said the swine flu outbreak has cost it £12.6m - as people cancelled travel to Mexico and other destinations.

The firm said the impact had been "more significant than expected".

But it added the strength of its brand - especially in the UK, had helped it remain resilient in "challenging economic and trading conditions".

Thomas Cook lost £49.5m in the nine months to June, after also being hit by costs from its merger with My Travel.

The company said it was seeing more late bookings for this summer, but that the proportion of its holidays sold remained similar to last year after it scaled back capacity.

However it has more long-haul trips left to sell than at the same time last year as travellers shun the popular Mexican tourist destination of Cancun.

Tough market conditions meant it did not expect to meet its operating profit target of £480m in 2010.

Insolvent German retailer Arcandor holds a 53% stake in Thomas Cook - but the travel firm has said it will be unaffected by Arcandor's problems.

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