Thomas Cook To Sell And Lease Back Planes

 

Thomas Cook To Sell And Lease Back Planes - Sky Today

Thomas Cook To Sell And Lease Back Planes - Sky Today

Thomas Cook has agreed to sell and lease back 17 aircraft, providing GBP£183 million (USD$296 million) to ease pressure on the debt-laden British travel company after its first-half loss widened.

Chief executive Sam Weihagen said on Friday the aircraft disposals provided substantial additional liquidity against a backdrop of a difficult trading environment.

“As expected, the first-half seasonal losses have widened. However, summer bookings have improved in recent weeks,” he said.

“Whilst our booking position for the second half is more encouraging, trading will be dependant on how well the group performs during the important lates market (short-notice bookings),” the group added.

Shore Capital analyst Karl Burns said whilst the sale and leaseback deals would help its cash balance, debt ratios were unlikely to be affected, given that the leases would be capitalised.

The company, which appointed ex-Kwik-Fit finance boss Michael Healy as chief financial officer on Wednesday, said UK bookings for the summer season were down 9 percent, ahead of capacity reductions of 13 percent, while average selling prices were stable, with a 4 percent rise.

Trading in western Europe, and notably in France, was challenging, it said, while in northern Europe bookings were down 6 percent but had continued to improve.

The group’s seasonal loss from operations for the six months to end-March widened to GBP£262.7 million from GBP£165.8 million.

Thomas Cook agreed to sell 11 Boeing 757 aircraft to Guggenheim Aviation Partners and six Boeing 767s to Aircastle. It also agreed in principle a deal with Guggenheim in respect of two more 767s.

(Reuters)



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