A leading City analyst has given a boost to ailing travel giant Thomas Cook saying a series of key factors are poised to drive it towards recovery.
The assessment will be welcomed by the operator and retailer, which is understood to be on the point of revealing its new chief executive. Former chief Manny Fontenla-Novoa was forced out of his job in August after having to issue a series of profit warnings.
Last month, Cook appointed Frank Meysman as its new chairman, taking over from Michael Beckett. The Belgian was formerly an executive at US consumer goods group Sara Lee Corporation.
Analyst Douglas McNeill, quoted in The Independent, said Cook still faced difficulties in the coming months, but that recovery was just around the corner.
He predicted the firm would sell its Indian interests for £100 million and was likely complete a rights issue early in 2012 that would raise a further £400 million.
McNeill added that the firm was also likely to agree a new deal with its lenders and that a breach of its covenants this December was unlikely, although he said it would be a “close call”.
Thomas Cook’s shares slumped this summer to just above 30p, at one point valuing the firm at below the £320 million profit it is on course to make this year. In recent days the share price has recovered and now sits at just over 50p, although that is still 60% lower than before its latest profits warning in July.