ITT 2014: Fontenla-Novoa defends time at Thomas Cook

ITT 2014: Fontenla-Novoa defends time at Thomas Cook

Former Thomas Cook chief executive Manny Fontenla-Novoa has defended his time at the company and hit out at people from outside the sector “telling us we are no good”.

However, he congratulated Thomas Cook’s current management on “a great job in rebuilding confidence”.

Fontenla-Novoa left Thomas Cook in August 2011 after a third profit warning in 12 months sent the company’s share price plunging.

At one point the group appeared worth considerably less than its debt.

Appearing at the Institute of Travel and Tourism (ITT) conference, Fontenla-Novoa said: “Thomas Cook is dear to my heart. I wish them every success.

“The new management team has done a great job in rebuilding confidence in the City and in the company and that is reflected in the share price.”

However, he defended his record at the group, telling the ITT: “We took a company that was, in effect, a retail business – it didn’t have a tour operator, it didn’t have an airline – and turned it into a business with £9 billion in revenue, operating in all the major markets as number one or number two, with 100 planes and over 2,000 shops.

“In the year I left it made a profit of £300 million. So we did some things well.”

Fontenla-Nova said: “You can’t do all these things without doing some things wrong.”

Asked if he would do anything differently with hindsight, he said: “If you go back to 2007 when we had just merged with MyTravel, it was a financial environment in which companies were encouraged to leverage their balance sheets.

“We bought back £350 million-worth of shares. That went out of the balance sheet, and we had a generous dividend policy.

“If we had not done that, we would have had a better balance sheet. It would have made a huge difference – £350 million went out of the business and because of the meltdown in the financial sector it made a difference.”

He added: “Travel is a great industry. I don’t think people realise how good they are.

“It cheeses me off people coming into the industry telling us we are no good. There is no such things as a perfect company or a perfect industry.”

Sourced from Travel Weekly

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