The ongoing ash crisis has cost the Thomas Cook Group about £70 million.
Speaking as the operator released its six-month unaudited figures ending March 31, chief executive Manny Fontenla-Novoa described April’s volcanic disruption as a “significant operational challenge”.
He added: “The precise financial impact is difficult to calculate and may take some time to finalise given the unprecedented nature of the event and the number of customers affected.
“However, our best estimate of the impact on our results is around £70 million, of which £15 million to £20 million relates to lost contribution.”
For the six months ending March 31 – before the ash crisis impacted – the group reported a drop in revenue of 5% to £3.3 billion, which it attributed to capacity cuts.
On this revenue it made an operational loss of £130.2 million, an increase of 15.1% year-on-year.
Fontenla-Novoa said he was pleased with the figures, adding: “Our first-half results demonstrate a solid operating result and strong cash flow performance.
“Our flexible capacity model has enabled us to adjust to lower demand in winter while planning for more resilient demand this summer.”
Summer 2010 product in the UK is now 65% sold with average selling prices up 2% on 2009 as consumers move away from higher priced long-haul bookings to medium-haul bookings which offer better margins despite being cheaper.
Bookings have risen 5% in the past four weeks and the operator has 9% less product in the UK to sell than at the same time last year.
“We continue to expect prices to trend upwards against last year as less lates activity is anticipated, and in the last four weeks average selling prices have been 11% ahead,” Fontenla-Novoa added.
Cook’s recent acquisitions are also performing strongly for this summer. Hotels4U has seen a 79% increase in bookings, while Gold Medal Netflights Retail is 45% ahead on this time last year.
Fontenla-Novoa added the group’s overall bookings for winter 2009/10 were 9% down in line with capacity reductions although the average selling price in the UK grew by 7%.
He said: “While we are faced with a backdrop of increasing economic uncertainty, our flexible business model and the importance of the holiday to the consumer stands us in good stead.
“We are pleased with the development of our summer bookings programme, particularly given the disruption caused by the volcanic ash cloud.
“If we exclude the estimated impact of the ash, the group remains confident of meeting board expectations for the year.”