Thomas Cook Reports 41% Increase in Income from Operations for Q3

By BW Hotelier THOMAS COOK (India) Ltd (TCIL) has declared its consolidated financial results for the quarter ended December 31, 2015 with an increase in consolidated Income from Operations of 41 per cent (Rs 7.4 Bn. to Rs 10.4 Bn.), consolidated pre- exceptional Profit Before Tax, a de-growth of 73 per cent (Rs 314 Mn. to Rs 84 Mn.) as compared to the corresponding period of 2014. The Company’s sustained focus on cash flow management resulted in improved cash flows from Rs 2044 Mn. to 2096 Mn., driven largely by better working capital management. Sterling Holiday Resorts Limited witnessed a growth in total Operating Income for Q3 at Rs 534.7 Mn. as compared to Rs 456.7 Mn. in the corresponding period of the previous year, representing an increase of 17 per cent. The company reported a pre- exceptional loss of Rs 15.1 Mn. Vs a profit of Rs 8.2 Mn. for the corresponding period. Quess Corp Ltd (’Quess’) filed its Draft Red Herring Prospectus (DRHP) on February 1, 2016 proposing to raise up to Rs 400 Cr. through an IPO. Post the filing of DRHP, Quess and Thomas Cook (India) Ltd have now entered into a ’silent period’ as regards the operating results of Quess. The quarter saw Thomas Cook India make a series of strategic acquisitions, with an eye on the larger Asia growth opportunity ’ which resulted in a corresponding cost impact of Rs 55 Mn. in the quarterly results. These acquisitions should see benefits accrue from Q4 of the current financial year. The acquisitions included Luxe Asia (a premium destination management company in Sri Lanka), Kuoni India (including the brands SOTC and SITA - the leading India inbound travel company) and Kuoni Hong Kong. The newly announced regulations around statutory bonus payment with retrospective effect from April 2014, also resulted in a significant impact on profitability for the quarter, with a provision of Rs. 62 Mn. At a market level, the quarter was set against the growing spectre of global terrorism and a highly volatile foreign exchange environment which witnessed significant fluctuations in the Rupee movement that resulted in negative consumer sentiment and a cascading dampener to travel demand. Commenting on the results, Madhavan Menon, Chairman & Managing Director, Thomas Cook (India) Ltd., (see photo) said, ’With an eye on the bigger Asia growth opportunity, we made a series of strategic acquisitions in the last quarter - including Luxe Asia, Kuoni India and Hong Kong. The cost of these acquisitions obviously impacted profitability in Q3 on a TCIL standalone basis, with expected benefits accruing from Q4 of the current fiscal as we focus on synergies and volume advantages.’