Thomas Cook reported strong sales in the UK in the latest quarter, as Brits booked their summer holidays despite the downturn, but all is not well in Britain’s second largest travel company as investors voiced their concerns over chief executive Harriet Green’s pay. Shareholders have raised objections to the huge pay packages of the chief executive and other directors of Thomas Cook, given the loss-making group’s current plight.
In Thomas Cook’s annual meeting in London, around 30% of shareholders voted against the travel group’s remuneration report. The advisory group Pirc advised investors to reject the report due to the two-year notice period handed to Harriet Green if Thomas Cook terminates her contract.
Analysts feel that Thomas Cook has made steady progress since Harriet Green took to the reigns last May. It has made a number of disposals to cut debt, including the sale of its Indian business and several Spanish hotels. The loss-making travel company, which saw a turnaround in the latest results, reported that sales for summer holidays were up 4% compared with 2012, while bookings in January were ahead by 2%. Thomas Cook said that a 9% hike in summer bookings in the UK, and a 10% increase in Nordic countries helped counteract falling demand in France and Germany as the eurozone’s debt crisis continues.
The news of shareholders revolt over executives’ pay comes just when the struggling travel group has begun to show signs of recovery. Thomas Cook claimed its turnaround plan was going on schedule as losses narrowed to £69.8m during the last three months of 2012, compared with £91.1m a year earlier. The 172-year-old group has struggled over the past few years with falling sales leading to a string of profit warnings. It has been forced to renegotiate bank loans and make disposals to cut debt.