TRAVEL firm Thomas Cook yesterday revealed that it had hired a new chief financial officer (CFO), after a tough trading period in which its financial performance was harmed by the Arab Spring.
Former Kwik-Fit finance boss Michael Healy is to take over as CFO from Paul Hollingworth, who will step down after helping the troubled firm to secure a banking lifeline.
Mr Hollingworth, who has been with the debt-laden tour operator for two years, will leave at the end of June. Earlier this month, he secured a three-year funding deal from banks for the group worth £1.4bn ($2.26bn), its third refinancing in a year.
Mr Healy, who has held finance director positions at Hong Kong listed First Pacific Company and online travel agency ebookers, played a major role in reducing risk in car repair firm Kwik-Fit’s highly-leveraged business, Thomas Cook said.
He starts his new job on July 1.
Shares in Thomas Cook, which is almost £900m in debt, rose yesterday. They have fallen around 86 per cent in the past year.
Peel Hunt analyst Nick Batram said Mr Healy appeared to tick the boxes in terms of industry experience and having worked with a highly-leveraged business, but he warned that Thomas Cook’s future might still be bleak.
“I think the good thing is he (Mr Healy) has clearly got time to look at the day-to-day business on the basis that the banking deal has been done and has been put in place,” said Mr Batram, adding that Mr Hollingworth’s exit had been expected.
“From that perspective it’s a good thing, but my overall view hasn’t changed. It is going to be a long turnaround for Thomas Cook and as of yet I am not convinced that they are going to be able to deliver what they hope to deliver.” Thomas Cook said Mr Hollingworth had decided to leave the group following the refinancing.
“The board is immensely grateful to Paul for the benefit of his experience and commitment and we are disappointed to be losing him,” chairman Frank Meysman said.
“He has worked tirelessly to bring stability to the group, enabling us to secure longer term bank facilities and provide a stable platform from which to build.”
Thomas Cook warned on its profits three times last year as civil unrest in North Africa and the economic downturn in Britain affected bookings.
Unrest in popular tourist destinations such as Egypt, Morocco and Tunisia had a damaging impact on the company’s performance.
The company has been forced to consider a number of fundraising proposals.
The world’s oldest travel group is in advanced talks to sell and lease back roughly one in five of its planes to raise cash, and it has also seen a “good level” of expressions of interest in its Indian business. It has already agreed to sell its Explorers Hotel in France.
The firm is also searching for a new chief executive, after a dire 2011 when more than half a billion euros in losses culminated in the departure of Manny Fontenla-Novoa in August.
In March, Thomas Cook said a new advertising campaign and website improvements had boosted sales in Britain.
The company can trace its roots back to 1841, when a cabinet-maker named Thomas Cook arranged a series of trips between Leicester, Nottingham, Derby and Birmingham on behalf of local temperance societies and Sunday schools. He organised excursions for workers from Yorkshire and the Midlands to the Great Exhibition of 1851. He later expanded the business to include escorted tours of Europe.