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Monday 22

April, 2019 6:18 PM



Thomas Cook quits Australian market after difficult year

Thomas Cook quits Australian market after difficult year

Global holiday giant Thomas Cook has confirmed it has sought an exit from the Australian market after only a year, as a tumultuous year in its home territory of Britain led to it making significant cutbacks to arrest a slide in profits and share pric

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By Nigel Frith 22.03.2019

Global holiday giant Thomas Cook has confirmed it has sought an exit from the Australian market after only a year, as a tumultuous year in its home territory of Britain led to it making significant cutbacks to arrest a slide in profits and share price.

The changing holiday market has proved challenging for the company, who have found themselves hit hard by fluctuating currency developments thanks to the impending UK exit from the EU, while their core target markets have been looking elsewhere because of financial restrictions caused by current economic uncertainty.

This has led Thomas Cook to scale back their business approach and shelve expansion opportunities which they had been confident about only a year ago, which highlights the rapidly changing nature of the holiday market.

The Australian arm of Thomas Cook has been bought out by Mark Tarring, the CEO who was running operations for the firm. Based in Hobart, he has chosen to rename the firm Tilda Travels and reposition it in the market as a "consumer travel and travel money one-stop shop."

Changing weather conditions in Britain have also meant that fewer people wanted to spend money to visit warmer places, with a hotter summer causing problems for many businesses who had not suitably diversified to meet altering habits.

This is not the first time the holiday company has quit Australia, and the firm, which is now 180 years old, was operating on this side of the world until 2000, when it sold all its Australian entities.

After successfully listing on the London Stock Exchange back in 2007, the company found new growth markets and during a period of expansion sought to enter into Australia again as it tried to go global once more.

However, this series of economic challenges has battered the share price, which fell a huge 80% between May and November 2018. This led Tarring to step in and acquire the Australian arm. Although the deal was agreed back at the tail end of last year, it has only formally been announced this week.

Tarring has spoken of his conviction that there is the potential for success for big holiday companies to operate in Australia, and the former Virgin Money chief operating officer believes the 30,000 customers they brought in over the last 12 months is proof of their ability to bring in a consistent clientele.

Their new owner said he had an ambitious plan to make serious inroads in the nation, and "have half a million customers in three to five years", while they also aim to "expand it into Asia."

He says that with moves already underway to have travel insurance underwritten by Lloyds but still retaining their name, and also to introduce a white-label credit card through a leading bank, there is evidence to suggest that Tilda Travel has all the tools and connections to develop into a leading holiday company brand in Australia.

They will also look to take commissions from recommendations for various other companies who offer services via their website, including hiring cars, getting mobile sim providers, and which companies to fly with.

Saying "it hasn’t happened because previously it’s been too hard", Tilda is expected to compete with the likes of Webjet and Flight Centre for consumers with what they believe is a more complete package.

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