15 May 2008 07:00
15 May 2008
Thomas Cook Group plc
Unaudited pro forma results for the 6 months ended 31 March 2008
Highlights
Group currency adjusted pro forma loss from operations** for the 6 months to March 2008 reduced to €193.6m (28% improvement) - excellent first half result.
Trading for summer 08 continues to be strong in all major markets with robust consumer demand.
Winter 08/09 early trading in the UK and Northern Europe is encouraging.
Group fuel requirements for remainder of this financial year hedged to 100% for crude and 90% for jet fuel. Group foreign currency requirements for remainder of year 100% hedged.
2008/09 fuel and foreign currency requirements hedged in line with policy - crude - 80%; Dollar - 65%; Euro - 56%.
On track to achieve merger synergies in excess of €200m by 2008/09, despite depreciation of Sterling against Euro of 15%.
Strategic acquisitions of Thomas Cook India, businesses in the Middle East, Hotels4U.com and Elegant Resorts.
Despite the higher cost of fuel and the translation impact of the weakening Sterling, and assuming no further deterioration in the Sterling:Euro exchange rate, the Board remains confident that the business will meet its expectations for the current financial year.
** See Appendix 2 for definitions.
Manny Fontenla-Novoa, Chief Executive, Thomas Cook Group plc said:
"I'm delighted with our performance over the winter and we are in a very good position for the summer. The rising cost of fuel and translational impact of the fall in Sterling against the Euro have made achievement of our Euro-denominated results more difficult, but I remain confident that we will achieve our goals for this year. For the longer term, our strategy is on track, our merger synergies are coming through, and we continue to target €620m of operating profit in 2009/10."
Enquiries
| Thomas Cook Group plc | Today | +44 (0) 20 7404 5959 | |
| Thereafter | +44 (0) 1706 746464 | ||
| Manny Fontenla-Novoa | Chief Executive | ||
| Ludger Heuberg | Chief Financial Officer | ||
| Steven Olivant | IR & Financial Communications Director | ||
| Brunswick | +44 (0) 20 7404 5959 | ||
| Fiona Antcliffe | |||
| Sophie Brand | |||
A presentation to analysts will take place today at 9.30am (BST) at UBS, 1 Finsbury Avenue, London EC2M 2PP.
A copy of the slides and a recording of the presentation will be available on our website at www.thomascookgroup.com.
OPERATING REVIEW
Overview of adjusted pro forma results
Currency adjusted Group pro forma revenue* for the 6 months to 31 March 2008 was €4,392.4m (2007: €4,174.3m), an increase of 5%. Currency adjusted pro forma Group loss from operations** decreased by 28% to €193.6m (2007: €267.6m). This result reflects underlying operational improvements in all segments and, in particular, in the UK where we are seeing the benefits of merger synergies coming through. Currency adjusted Group pro forma EBITDA† improved significantly by 41% to a loss of €102.3m (2007: loss of €173.2m).
Strategy
The Group's strategy is to improve its performance in mainstream tour operating; develop its independent travel businesses and travel-related financial services; invest in emerging markets; and grow overall revenue and profit. Following the successful integration of MyTravel Group plc and Thomas Cook AG, we remain on track to achieve merger synergies in excess of €200m by 2008/09. This has been achieved through better than expected results from the integration of our UK businesses and comes despite the depreciation of Sterling against the Euro by 15% since the merger was agreed in February 2007. Our principal target remains to achieve Group operating profit of more than €620 million in 2009/10, implying EBITDA of more than €800 million.
Since announcing our annual results on 30 January, we have made good progress towards each of our goals. Our mainstream tour operating businesses are performing well. We are particularly pleased with the improvement in the UK, which is attributable partly to cost reductions as a result of the merger and partly to improvements in the operation of the business.
The Board continues to be focused on delivering value for shareholders. In addition to our organic growth and the acquisitions of Thomas Cook India, businesses in the Middle East, Hotels4U.com and Elegant Resorts, we have introduced a progressive dividend policy and implemented the share buy-back programme to return capital to shareholders.
We recently announced the strengthening of our management team with the appointment of Angus Porter as Group Strategy Director and Sue Biggs as Managing Director, Independent Travel UK.
Current trading
Summer 08
Trading for summer 2008 has been strong in our main markets and we have started the season with an excellent capacity left to sell position which puts us in good stead for the rest of the financial year.
| Year on year pro forma variation % | Average selling price | Bookings | Capacity |
| UK | +3 | -5 | -10 |
| Northern Europe | +9 | +7 | +2 |
| Continental Europe | +3 | +3 | - |
| North America | -4 | flat | -2 |
Note: Figures above are as at 10/11 May 2008. The figures above for UK, Northern Europe and North America represent Risk bookings only. In Continental Europe, all bookings are included.
In the UK, capacity is currently 10% lower. We currently have 18% fewer holidays to sell than at this time last year, which should stand us in good stead in the lates market. We are particularly encouraged by our much lower level of stock left to sell in short haul and long haul. Average selling prices are currently 3% ahead.
| UK haul mix: Year on year pro forma variation % | Left to sell | Capacity |
| Short haul | -34 | -23 |
| Medium haul | -9 | -2 |
| Long haul | -27 | -12 |
| UK total | -18 | -10 |
The reduction in capacity in long haul is largely due to the increase in the aircraft seat pitch. In addition, we have exited unprofitable routes to China and other long haul destinations as part of our review of flight programmes.
Northern Europe summer 2008 trading has continued well, with bookings currently 7% ahead year on year on capacity up only 2%. Average selling prices are 9% ahead.
In Continental Europe, summer 2008 trading to date is strong. Total bookings are up 3% with average selling prices now 3% higher year on year.
In Germany, through improvements in capacity management, we now have significantly fewer holidays on risk to sell than in the prior year.
Trading in Belgium, our next largest market, has also continued well. Bookings are currently slightly behind the prior year but selling prices are well ahead. In the Netherlands, bookings are ahead of the prior year with average selling prices in line.
Trading in France, where volumes are much lower, is very strong with increasing bookings and average selling prices. In the Eastern markets (Poland, Hungary and the Czech Republic), we continue to grow the businesses and trading is in line with our expectations.
In North America, where the summer season is the low season for the charter market and capacity is therefore limited, trading is satisfactory.
Airlines Germany capacity overall is 9% lower, with the largest reduction the result of eliminating unprofitable city routes. The booked load factor is up 2%.
Winter 08/09
Winter 08/09 holidays are now on sale in the UK and Northern Europe. In the UK, bookings are currently 4% ahead of the prior year, and margins are encouraging. Consumer demand appears to be robust. In Northern Europe, we have seen a strong start, with bookings 11% ahead and average selling prices 2% ahead year on year.
Acquisitions
We have made three significant acquisitions, with a major entry into new emerging markets and two smaller acquisitions to further develop our independent travel business. All these acquisitions are expected to meet the Group's acquisition criteria in respect of of earnings accretion by year two and exceeding the cost of capital by year three.
In March, we announced the acquisition of up to 74.9% of the issued share capital of Thomas Cook India Limited, 100% of Thomas Cook branded business in Egypt and licences for the Thomas Cook brand in 15 Middle East countries. The total cash consideration for these acquisitions will be between €208 million and €249 million subject to the outcome of an open offer process for up to 20% of Thomas Cook India shares which will commence on 16 May 2008 and close on 5 June 2008. The acquisition of 54.9% of Thomas Cook India shares has already been completed in a private transaction with Dubai Financial Group LLC.
As a result of the above transactions, the Group now has global control of the Thomas Cook brand, which is one of the world's most widely recognised travel brands.
India is one of the fastest-growing travel markets, expanding by 15% per annum. Thomas Cook India is already the largest foreign exchange business and the second largest travel company in India. We are confident that as part of the Group, this business will be a significant contributor to profits growth.
In February 2008, the Group announced the acquisition of Hotels4U.com for an initial consideration of £21.8 million, net of amounts to be reinvested by Haim Perry, Managing Director, and Jacky Bedlow, Finance Director. The management's reinvestment is subject to earn out arrangements based on the profitability of Hotels4U up to 2013.
Through the acquisition of Hotels4U.com, the Group is able both to enhance its position in the independent travel sector and strengthen its mainstream business. Hotels4U is the UK's largest independent bed bank. It sells exclusively over the internet, providing accommodation and resort transfers to over 500,000 customers per annum. It has access to more than 30,000 hotels internationally.
In April, we announced the acquisition of Elegant Resorts Ltd, the number one UK-based luxury travel company, in a further move to develop our independent travel business.
Share buy-back programme
At the Extraordinary General Meeting on 12 March 2008, shareholders approved a €375 million share buy-back programme. At the close of business on 14 May 2008, the Group had purchased a total of 29,006,303 shares for cancellation, at a total cost of £81.9 million, excluding commission. Of these shares, 7,336,303 were purchased from Arcandor AG, as a result of which, Arcandor now owns 52.82% of the Group.
Condor
It was announced in March 2008 that the Bundeskartellamt (Federal Cartel Office) had extended the deadline for completion of its primary evaluation of the merger of Condor Flugdienst GmbH, the Group's German airline, and Air Berlin plc, until 9 June 2008. This extension was made in order to allow Thomas Cook and Air Berlin to continue their discussions with the Bundeskartellamt case team with a view to agreeing appropriate undertakings from the parties in order to obtain the consent required for the merger to proceed.
The Group is currently evaluating its position in the event that the transaction we have announced does not receive the necessary clearance from the Bundeskartellamt. Condor remains a strong business, which gives the Group a number of options in respect of the future development of the business.
Fuel and foreign exchange
Fuel costs represent approximately 8% of the Group's revenue and volatility in prices can have a material impact on the Group's variable cost base. We actively manage the volatility by hedging our fuel trading requirements over an 18-24 month period.
Group fuel requirements for remainder of this financial year are hedged to 100% for crude and 90% for jet fuel. For 2008/09, we are hedging in line with our policy and have now hedged 80% of the Group's expected fuel requirement. Due to the lack of a liquid long term jet fuel forward market, the 2008/09 hedges are in crude oil. However, we will keep prices and market conditions under review and decide whether to roll these hedges into jet fuel hedges as we get closer to the date of consumption.
As with fuel, the Group manages foreign currency exchange rate volatility by hedging its foreign currency trading requirements over an 18-24 month period. For the remainder of the current financial year, we have hedged 100% of the Group's foreign currency requirements, which are mainly in Euros and Dollars. For 2008/09, we have now hedged 65% of the Group's Dollar requirements and 56% of the Group's Euro requirements.
The weakening of Sterling against the Euro over the last few months has given rise to a translational gain of €17.7m in the six months to March 2008. To assist year on year comparability of underlying trading performance, we believe this gain should not be presented and, as a result, we have shown the figures and commentary in the report on an adjusted currency basis (see Appendix 2 for details of basis of adjustment).
The gain of €17.7m reflects the fact that our UK operations traditionally make losses in the winter period. As the UK business is expected to make substantial profits for the full year, the full year effect of translation will be negative. If current exchange rates are substantially unchanged, we expect to be able to mitigate the resulting translational loss through other actions the Group is taking.
Group reporting currency
On the formation of Thomas Cook Group plc in June 2007, a significant proportion of the Group's profits were arising in countries where the Euro is the local currency. As a result, the Board considered the Euro to be the most appropriate reporting currency for the Group. Since then, however, we have increased and accelerated our synergy benefits in the UK and acquired businesses in the UK and other non-Euro countries. Consequently, in 2008 and beyond, we expect to generate the majority of our profits in non-Euro countries, with the UK being by far the largest. As a result, the Board has decided to change the reporting currency to Sterling and the Group's formal interim results for the six months to 30 April 2008, to be announced in June 2008, will therefore be presented in Sterling.
Outlook
The Group has had a successful winter and trading to date for the summer season is strong. The Board therefore believes that the Group is in a strong position and that underlying trading is robust although we still have more than four months' trading to go. We have not seen any effect on our trading to date from the current economic conditions. We continue to believe this can be primarily attributed to (i) the high priority that European consumers place on their major foreign holidays, and (ii) our ability, through our asset-light model, to proactively manage the balance between supply and demand. By managing the number of holidays to be sold, we believe we are in a position to benefit from higher average selling prices and our flexibility means we are less exposed to any future change in demand.
Despite the higher cost of fuel and the translation impact of the weakening Sterling, and assuming no further deterioration in the Sterling:Euro exchange rate, the Board remains confident that the business will meet its expectations for the current financial year.
In the longer term, merger synergies in excess of €200m provide a sound platform for the achievement of our target of at least €620m operating profit in 2009/10.
FINANCIAL REVIEW
Review of pro forma segmental results
The pro forma segmental revenue* and loss from operations** figures are presented below. The first table shows the segmental figures in Euros, translated at the exchange rates prevailing at March 2008 and March 2007 respectively. The second table shows the segmental figures in Euros translated at the prevailing exchange rates at March 2007. This alternative presentation has been included to eliminate the significant distortions in translating reported results brought about by the weakening of Sterling against the Euro and thereby to assist year on year comparability of underlying trading. The commentary on segmental performance uses the adjusted figures in the second table as the reference point.
Table 1: Pro forma unaudited segmental performance review
| | 6 months ended 31 March 2008 €m | 6 months ended 31 March 2007 €m | Change % |
| Revenue* | | | |
| UK | 1,360.2 | 1,414.0 | -3.8% |
| Northern Europe | 655.3 | 596.9 | +9.8% |
| Continental Europe | 1,509.5 | 1,493.6 | +1.1% |
| North America | 339.1 | 362.0 | -6.3% |
| Airlines Germany | 370.0 | 307.6 | +20.3% |
| Corporate | 0.2 | 0.2 | 0% |
| | | | |
| Group | 4,234.3 | 4,174.3 | +1.4% |
| | | | |
| Loss from operations** | | | |
| UK | (164.3) | (229.9) | +28.5% |
| Northern Europe | 48.2 | 40.4 | +19.3% |
| Continental Europe | (42.6) | (48.5) | +12.2% |
| North America | 10.8 | 8.0 | +35.0% |
| Airlines Germany | (15.2) | (21.9) | +30.6% |
| Corporate | (12.8) | (15.7) | +18.5% |
| | | | |
| Group | (175.9) | (267.6) | +34.3% |
| | | | |
Revenue in Airlines Germany above is stated net of inter company sales to the Continental Europe division of €176.8m (2007: €228.2m).
See Appendix 2 for definitions.
Table 2: Adjusted pro forma unaudited segmental performance review
| | 6 months ended 31 March 2008 €m | 6 months ended 31 March 2007 €m | Change % |
| Revenue* | | | |
| UK | 1,509.3 | 1,414.0 | +6.7% |
| Northern Europe | 673.9 | 596.9 | +12.9% |
| Continental Europe | 1,509.5 | 1,493.6 | +1.1% |
| North America | 329.5 | 362.0 | -9.0% |
| Airlines Germany | 370.0 | 307.6 | +20.3% |
| Corporate | 0.2 | 0.2 | 0% |
| | | | |
| Group | 4,392.4 | 4,174.3 | +5.2% |
| | | | |
| Loss from operations** | | | |
| UK | (182.3) | (229.9) | +20.7% |
| Northern Europe | 49.5 | 40.4 | +22.5% |
| Continental Europe | (42.6) | (48.5) | +12.2% |
| North America | 10.5 | 8.0 | +31.3% |
| Airlines Germany | (15.2) | (21.9) | +30.6% |
| Corporate | (13.5) | (15.7) | +14.0% |
| | | | |
| Group | (193.6) | (267.6) | +27.7% |
| | | | |
Revenue in Airlines Germany above is stated net of inter company sales to the Continental Europe division of €176.8m (2007: €228.2m).
See Appendix 2 for definitions.
UK
Adjusted pro forma revenue* for the period increased by 7% on the prior year. This increase largely reflects an increase in average selling prices achieved partly offset by lower passenger numbers as a result of the planned reductions in capacity. Despite significant increases in the cost of fuel, gross margins were improved year on year. In addition, overhead costs were also reduced year on year as a result of the successful release of merger synergy benefits. Consequently, the adjusted pro forma loss from operations** for the 6 months to March 2008 decreased by €47.6m, or 21% year on year to €182.3m.
Northern Europe
Adjusted pro forma revenue* in Northern Europe for the 6 months to March 2008 increased year on year by 13%, to €673.9m, reflecting an increase in both passenger numbers and average selling prices. This improvement was achieved as a result of our successful capacity management, which continues to take advantage of the growth in long haul products in the winter, and the strength of our "Sunwing" branded hotel concept. As a result of the strong trading performance, the adjusted pro forma profit from operations** increased by €9.1m, or 23%, to €49.5m, despite the rising fuel prices.
Continental Europe
Adjusted pro forma revenue* in the 6 months to March 2008 in Continental Europe increased by 1% year on year to €1,509.5m and the adjusted pro forma loss from operations** was reduced by €5.9m, or 12%, to €42.6m.
The performance in Germany was particularly pleasing. Passenger volumes in the winter months (November to March) were higher year on year and, despite a reduction in average selling prices, the gross margin was improved, largely as a result of improved capacity management. There were also savings in overhead costs which further improved the performance.
The Western markets, in particular France and Holland, also performed well in the period with increases in average selling prices achieved. In the Eastern markets, increases in passenger volumes were offset by a slight reduction in average selling prices, lower flight capacity utilisation and higher overhead costs.
North America
Adjusted pro forma revenue* in the 6 months to March 2008 reduced by 9% reflecting lower passenger numbers and reduced selling prices. Difficult trading conditions as a result of over-capacity in the market place have continued to prevail in Canada and we continue to look for longer-term opportunities to mitigate the volatility in the risk business. In the meantime, management reduced the capacity on sale for winter 2008/09. This capacity management, together with careful cost control, has resulted in an improvement in adjusted pro forma profit from operations** year on year of €2.5m, or 31%, to €10.5m.
Airlines Germany
Total adjusted pro forma revenue* in the 6 months to March 2008 increased by 2% year on year. This reflects an increase in long haul volumes and yields achieved, offset partly by a reduction in European flying.
Despite the increase in revenue, gross margin fell year on year as a result of the significant increase in the price of fuel which the airline was not able to fully pass onto customers. Other operating costs were, however, reduced year on year and as a result, the adjusted pro forma loss from operations** decreased by €6.7m, or 31%, to €15.2m.
Corporate
The adjusted pro forma loss from operations** in the 6 months to March 2008 was reduced by €2.2m, or 14%, to €13.5m. This reduction largely reflects cost savings as a result of the realisation of synergy benefits within the corporate functions.
Exceptional items
Exceptional items in the pro forma 6 months to March 2008 amounted to €65.4m (pro forma 6 months to March 2007: €66.9m) and largely relate to our ongoing integration activities, particularly in the UK.
Net finance costs
Net finance costs in the pro forma 6 months to March 2008 were €33.3m (pro forma 6 months to March 2007: €8.8m). The increase year on year is attributable to revaluation losses on trading securities and lower finance income as a result of a lower cash balance and lower interest rates. The reduced cash balance is due in part to expenditure on acquisitions and on integration costs.
Dividends
The Board continues to believe that it is desirable to provide shareholders with dividend payments increasing progressively over time and expects to recommend dividends per share in respect of each full year in the range of 40-50 per cent of earnings per share. Details of the 2008 interim dividend payment will be set out in our announcement of statutory half year results in June.
Arcandor reporting
Arcandor, our majority shareholder, is today issuing its half year report to the German market in line with German regulatory requirements. This report contains statutory financial information relating to Thomas Cook Group plc for the five months ended 31 March 2008 and 2007 drawn up in line with Arcandor's accounting policies and formats.
In addition, in its press release relating to the half year report, Arcandor has provided illustrative results for Thomas Cook Group plc for the six months ended 31 March 2008 and 31 March 2007. The basis of preparation of these illustrative results is set out in their press release and differs from that used by Thomas Cook Group plc in reporting its pro forma results included in this announcement. As a result, the Board of Thomas Cook Group plc has not approved this illustrative information. In addition, it should be noted that the prior year information included in the Arcandor half year report relating to Thomas Cook Group plc is not directly comparable to the prior year information included in this statement, which is on a pro forma basis.
Pro forma information for the 12 months to September 2007
Included in the financial information in the appendix to this report is pro forma income statement information for the 12 months to September 2007 which shows what the pro forma results would have been had Thomas Cook Group plc had a September year end last year. The impact of restating the prior year information has been to reduce pro forma profit from operations** in 2007 by €14.0m. We anticipate the impact of the change in accounting reference date for the 12 months to September 2008 to be in the region of €25m due to the anticipated year on year trading improvement in the month of October 2008 compared with October 2007, partly due to the increased level of synergy realisation in the UK.
Appendix 1
Pro forma Group Income Statement
| Unaudited | Unaudited | Unaudited | ||
| 6 months to | 6 months to | 12 months to | ||
| 31/03/08 | 31/03/07 | 30/09/07 | ||
| €m | €m | €m | ||
| Sales | 4,234.3 | 4,174.3 | 11,657.3 | |
| Cost of providing tourism services | (3,308.1) | (3,258.0) | (9,048.6) | |
| Gross profit | 926.2 | 916.3 | 2,608.7 | |
| Other operating income | 28.0 | 13.2 | 48.3 | |
| Personnel expenses | (629.9) | (685.4) | (1,388.3) | |
| Depreciation and amortisation | (88.4) | (94.4) | (187.3) | |
| Impairment of goodwill | - | (13.5) | (13.5) | |
| Other operating expenses | (478.1) | (490.7) | (982.3) | |
| Profit on disposal of businesses and | ||||
| property, plant & equipment | 0.9 | 20.0 | 22.4 | |
| (Loss)/profit from operations | (241.3) | (334.5) | 108.0 | |
| Analysed between: | ||||
| (Loss)/profit from operations before | ||||
| exceptional items | (175.9) | (267.6) | 361.3 | |
| Exceptional items | (65.4) | (66.9) | (253.3) | |
| (241.3) | (334.5) | 108.0 | ||
| Share of results of associates and joint ventures | (2.3) | (4.5) | (3.8) | |
| Profit on disposal of associates | (0.1) | 5.4 | 54.8 | |
| Net investment income | 1.7 | 0.8 | 1.1 | |
| Net finance costs | (33.3) | (8.8) | (11.7) | |
| (Loss)/profit before tax | (275.3) | (341.6) | 148.4 | |
| All sales and results arose from continuing operations. | ||||
Pro forma Group Statement of Net Assets
| | | | Unaudited | |
| | | | as at | |
| | | | 30/09/07 | |
| | | | €m | |
| Non-current assets | | | | |
| Intangible assets | | | 4,170.2 | |
| Property, plant & equipment | | | | |
| | Aircraft and spare engines | | | 833.2 |
| | Other | | | 313.0 |
| Investment in associates and joint ventures | | | 48.1 | |
| Other investments | | | 38.3 | |
| Deferred tax assets | | | 477.4 | |
| Tax assets | | | 0.2 | |
| Trade and other receivables | | | 151.7 | |
| Pension asset | | | 0.5 | |
| Derivative financial instruments | | | 18.9 | |
| | | | 6,051.5 | |
| Current assets | | | | |
| Inventories | | | 26.7 | |
| Tax assets | | | 25.9 | |
| Trade and other receivables | | | 1,281.1 | |
| Derivative financial instruments | | | 69.2 | |
| Cash and cash equivalents | | | 1,228.5 | |
| | | | 2,631.4 | |
| Non-current assets held for sale | | | 107.6 | |
| Total assets | | | 8,790.5 | |
| | | | | |
| Current liabilities | | | | |
| Retirement benefit obligations | | | (3.3) | |
| Trade and other payables | | | (2,379.0) | |
| Borrowings | | | (101.9) | |
| Obligations under finance leases | | | (112.5) | |
| Tax liabilities | | | (123.8) | |
| Revenue received in advance | | | (1,048.1) | |
| Short-term provisions | | | (263.1) | |
| Derivative financial instruments | | | (124.6) | |
| | | | (4,156.3) | |
| Liabilities related to assets held for sale | | | (59.3) | |
| Non-current liabilities | | | | |
| Retirement benefit obligations | | | (271.2) | |
| Trade and other payables | | | (183.0) | |
| Long-term borrowings | | | (166.5) | |
| Obligations under finance leases | | | (522.5) | |
| Revenue received in advance | | | (0.5) | |
| Deferred tax liabilities | | | (134.2) | |
| Long-term provisions | | | (277.6) | |
| Derivative financial instruments | | | (23.8) | |
| | | | (1,579.3) | |
| Total liabilities | | | (5,794.9) | |
| | | | | |
| Net assets | | | 2,995.6 | |
Notes to the Pro forma Interim Financial Information
Basis of preparation
The pro forma information has been prepared using the accounting policies stated in the Company's report and accounts for the year ended 31 October 2007. For comparison purposes, the amortisation of business combination intangibles has been excluded from the pro forma information.
The information in this report relating to the six months ended 31 March 2008, the six months ended 31 March 2007 and the year ended 30 September 2007 is pro forma and unaudited and does not constitute full statutory accounts within the meaning of section 240 of the Companies Act 1985.
A copy of the statutory accounts for the year ended 31 October 2007 has been delivered to the Registrar of Companies. The auditors' report on those accounts was not qualified and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985.
Appendix 2
Definitions
* Revenue for the Group and segmental analysis represents external revenue only, except in the case of the Airlines Germany segmental performance review where revenue of €176.8m (2007: €228.2m) largely to the Continental Europe division has been included.
** Profit/loss from operations is defined as earnings before interest and tax, and has been adjusted to exclude exceptional items and amortisation of business combination intangibles. It also excludes our share of the results of associates and joint ventures.
In the case of pro forma profit/loss from operations, the figures reflect the underlying results for the period (and the comparative period) for each of MyTravel Group plc, Thomas Cook AG and Thomas Cook Group plc and have been prepared by the Directors to illustrate the effect of the merger of Thomas Cook AG and MyTravel Group plc as if the transaction had taken place prior to the first day of the comparative period presented.
Currency adjusted pro forma revenue and profit/loss from operations figures have also been presented to eliminate the impact of year on year translational exchange gains and losses. In the case of currency adjusted pro forma figures, the results for the 6 months to March 2008 have been translated at the average exchange rate for the 6 month period to March 2007.
†Currency adjusted pro forma EBITDA is defined as adjusted profit/loss from operations (see above) before depreciation and amortisation.