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Thomas Cook's shares tumble as it announces £328m loss

Misery continues for the beleaguered travel agency.

The British travel company Thomas Cook Group has posted a pre-tax loss of £712.9m for the six months ended 31 March 2012, a staggering increase from £269.4m for the same period last year. Its underlying pre-tax loss for the period came to £328m.

Revenue increased by 2.5 per cent to £3.52bn (2011: £3.43bn), a dim silver lining that reflects the impact of its acquisitions (Intourist, the company’s Russian business, and Co-op in the UK in particular). Likewise, total revenue in its Airlines Germany division climbed 11.3 per cent to £506.4m (2011: £455m). 

Sam Weihagen, interim CEO, also announced today that he expects "it could be very profitable" if Greece leaves the eurozone, as holidays to the Mediterranean country would become cheaper. 

Yet it has been a tough six months for the 170-year-old company. Gross profit slipped from £713.8m last year to £709.6m. Net finance costs increased to £66.9m (2011: £64.5m), mainly as a result of higher average borrowing levels and increased arrangement fees.

The company’s UK segment revenue was down £29.4m at £993.1m.

Though the company’s central Europe segment revenue increased by 13.9 per cent, western Europe revenues declined by 11.5 per cent. Revenues for the northern Europe segment grew 8.6 per cent but North American revenues declined 14.4 per cent. 

Basic loss per share was 68.2p (2011: 23.5p), while net debt increased to £1.39bn (2011: £1.09bn). 

Sam Weihagen, group chief executive of Thomas Cook Group, said: 

At the beginning of this month, we were delighted to announce the agreement with our banking group of longer term and more flexible funding. This, combined with the sale of Thomas Cook India, the sale and leaseback of some of our aircraft and the disposal of other non-core assets, provides the group with a much stronger financial platform. From this platform, we can re-energise our business and begin to rebuild profitability, reduce debt and continue to provide a fantastic holiday experience for our customers.

Photo: Getty Images
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No, IDS, welfare isn't a path to wealth. Quite the opposite, in fact

Far from being a lifestyle choice, welfare is all too often a struggle for survival.

Iain Duncan Smith really is the gift that keeps on giving. You get one bile-filled giftbag of small-minded, hypocritical nastiness and, just when you think it has no more pain to inflict, off comes another ghastly layer of wrapping paper and out oozes some more. He is a game of Pass the Parcel for people who hate humanity.

For reasons beyond current understanding, the Conservative party not only let him have his own department but set him loose on a stage at their conference, despite the fact that there was both a microphone and an audience and that people might hear and report on what he was going to say. It’s almost like they don’t care that the man in charge of the benefits system displays a fundamental - and, dare I say, deliberate - misunderstanding of what that system is for.

IDS took to the stage to tell the disabled people of Britain - or as he likes to think of us, the not “normal” people of Britain -  “We won’t lift you out of poverty by simply transferring taxpayers’ money to you. With our help, you’ll work your way out of poverty.” It really is fascinating that he was allowed to make such an important speech on Opposite Day.

Iain Duncan Smith is a man possessed by the concept of work. That’s why he put in so many hours and Universal Credit was such a roaring success. Work, when available and suitable and accessible, is a wonderful thing, but for those unable to access it, the welfare system is a crucial safety net that keeps them from becoming totally impoverished.

Benefits absolutely should be the route out of poverty. They are the essential buffer between people and penury. Iain Duncan Smith speaks as though there is a weekly rollover on them, building and building until claimants can skip into the kind of mansion he lives in. They are not that. They are a small stipend to keep body and soul together.

Benefits shouldn’t be a route to wealth and DWP cuts have ensured that, but the notion that we should leave people in poverty astounds me. The people who rely on benefits don’t see it as a quick buck, an easy income. We cannot be the kind of society who is content to leave people destitute because they are unable to work, through long-term illness or short-term job-seeking. Without benefits, people are literally starving. People don’t go to food banks because Waitrose are out of asparagus. They go because the government has snipped away at their benefits until they have become too poor to feed themselves.

The utter hypocrisy of telling disabled people to work themselves out of poverty while cutting Access to Work is so audacious as to be almost impressive. IDS suggests that suitable jobs for disabled workers are constantly popping out of the ground like daisies, despite the fact that his own government closed 36 Remploy factories. If he wants people to work their way out of poverty, he has make it very easy to find that work.

His speech was riddled with odious little snippets digging at those who rely on his department. No one is “simply transferring taxpayers’ money” to claimants, as though every Friday he sits down with his card reader to do some online banking, sneaking into people’s accounts and spiriting their cash away to the scrounging masses. Anyone who has come within ten feet of claiming benefits knows it is far from a simple process.

He is incredulous that if a doctor says you are too sick to work, you get signed off work, as though doctors are untrained apes that somehow gained access to a pen. This is only the latest absurd episode in DWP’s ongoing deep mistrust of the medical profession, whose knowledge of their own patients is often ignored in favour of a brief assessment by an outside agency. IDS implies it is yes-no question that GPs ask; you’re either well enough to work or signed off indefinitely to leech from the state. This is simply not true. GPs can recommend their patients for differing approaches for remaining in work, be it a phased return or adapted circumstances and they do tend to have the advantage over the DWP’s agency of having actually met their patient before.

I have read enough stories of the callous ineptitude of sanctions and cuts starving the people we are meant to be protecting. A robust welfare system is the sign of a society that cares for those in need. We need to provide accessible, suitable jobs for those who can work and accessible, suitable benefits for those who can’t. That truly would be a gift that keeps giving.