Thomas Cook Group Corporate Strategy

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					Thomas Cook Group Corporate Strategy
Investor Day Presentation
Royal Opera House, London
10 March 2010
Disclaimer and cautionary statement
  This presentation does not constitute an invitation or inducement to underwrite, subscribe for or otherwise
  acquire or dispose of (or engage in any other investment activity in relation to) any Thomas Cook Group plc
  (‘the Company’) shares or other securities.

  This presentation contains certain forward-looking statements and forecasts (based on information known to the
  Company on the date shown) with respect to future matters, including strategies, initiatives and targets, the
  financial condition, results and operations of the Company. These statements and forecasts involve risks and
  uncertainty because they relate to events and depend on circumstances that will occur in the future. There are
  a number of factors that could cause actual results or developments to differ materially from those expressed or
  implied by these forward-looking statements and forecasts, including factors that are outside of the Company’s
  control. This presentation does not constitute a commitment by the Company to proceed with a certain
  transaction or business practice in the future. Except as required by its legal or regulatory obligations, the
  Company does not undertake any obligation to update or revise publicly any forward-looking statement or
  forecast, whether as a result of new information, future events or otherwise. The reader should, however,
  consult any future disclosures that the Company may publish via the Regulatory News Service.

  Past performance is no guide to future performance and persons needing advice should consult an
  independent financial adviser. Neither the Company nor anyone acting on its behalf makes any representation
  or warranty, express or implied, as to the accuracy or completeness of the information contained in this
  presentation. Neither the Company nor any person acting on its behalf shall have any liability whatsoever for
  loss, howsoever arising, directly or indirectly, from use of the information contained within this presentation.

  10 March 2010

Page 2
Welcome and Introduction
Manny Fontenla-Novoa, Group CEO
Agenda

Welcome and Introduction          Manny Fontenla-Novoa              0900 – 0920

Strategic Progress Case Studies   Management Team                   0920 – 1015

Strategy for Growth               Paul Hollingworth, Jürgen Büser   1015 – 1045

                                  Refreshments

Growth Strategy Case Studies      Management Team                   1115 – 1225

Summary and Wrap-up               Manny Fontenla-Novoa              1225 – 1230

Q&A                               Management Team                   1230 – 1300

                                  Lunch




Page 4
What we are going to cover in this section


         • Senior management team introductions

         • Thomas Cook in 2007 – recap of our objectives

         • Progress review against those objectives

         • Case studies of how we solved key strategic challenges

         • Summary of where we are today




Page 5
         Senior management team introductions




Page 6
Thomas Cook management team presenting today

   Segment Heads                             Functional Heads

   • Sam Weihagen, CEO Northern Europe¹      • Paul Hollingworth, Group CFO

   • Ian Derbyshire, CEO UK & Ireland        • Pete Constanti, CEO Group Destination Management

   • Thomas Döring, CEO West/ East           • Jürgen Büser, Group Strategy Director

   • Peter Fankhauser, CEO Central Europe    • Simon Breakwell, Ecommerce Advisor

   • Michael Friisdahl, CEO North America

   • Ralf Teckentrup, CEO Airlines Germany




   Note: ¹ Also Deputy Group CEO
Page 7
         Thomas Cook in 2007




Page 8
Thomas Cook in 2007

   Merger with MyTravel announced February 2007, completed June 2007

   • Led industry consolidation and created one of the world’s largest travel groups

   • Over 30k employees in 15 source markets and two distinct cultures to integrate

   • A single majority shareholder (Arcandor with 52%)

   • Strong management individuals with a track record of turning around businesses

   • A set of industry leading travel brands, under the Thomas Cook umbrella


         Provided a number of strategic challenges and opportunities



Page 9
We developed a strategy for long term growth
                                                                                               Vision




                                              Strategic objectives
                                                           Strengthening our business and investing for growth

                                        Growth drivers




                                              Maximise                          Become a                   Become                 Capture
                                              value of                           leading                 the leading            growth and
                                             mainstream                       independent               travel-related         value through
                                                                             travel provider               financial             M&A and
                                                                                                            services            partnerships
                                                                                                           provider




                                  Enablers
                                         Product                     Technology        Customer insight            Brands            Financial rigour

                               Values
                                         P                               R                      O                        U                     D
                                   Pioneering our                      Results           Obsessed with          United as one team        Driving robust
                                       future                        orientated         customer service                                    decisions

   Note: Version shown is strategy as of FY09, this has not materially changed since 2007
Page 10
We set some challenging objectives to achieve by 2010

   • Create a single, customer-focused, Group culture

   • Develop management into an industry leading and united team

   • Maximise the value of mainstream through margin and capacity management

   • Increase independent travel revenues by 50%

   • Significantly grow travel-related financial services

   • Grow through M&A, with a focus on consolidation and emerging markets

   • Integrate two businesses and deliver €200m of synergies

                    Significantly grow top line, profit and margin

Page 11
          Progress since the merger




Page 12
Since 2007 we’ve seen unprecedented market conditions

                                                             Oil rises past $140
  Economy at 60-year low, says Darling



   Credit crisis fells Lehman Brothers            Jobless highest level for 17 years



          Pound nears parity with the Euro
                                                                 Pound hits Eight-year
                                                                    low against dollar
          Surge in last-minute foreign holidays


                  Despite this backdrop, we’ve made significant progress

Page 13
Created a single Group culture

   People highlights                                                          Employee engagement score

   • Vision and Values rolled out Group-wide                                           >180 companies
                                                                                4.0                     Thomas Cook
                                                                                         Top decile
   • Single Group culture developed                                                                     score: 3.83
                                                                                3.6

   • Very high employee engagement                                              3.2

                                                                                2.8
      – Score in top 10% of cross industry benchmark¹
                                                                                2.4
      – Employee satisfaction increased year-on-year                                    Bottom decile
                                                                                2.0
                                                                                      ETS Benchmark




 Note: ¹Based on benchmark of 180 companies
 Source: ETS (Expert Training Systems) ECHO employee engagement survey FY09
Page 14
Strengthened and streamlined senior team

   Major changes since merger                   New senior management team structure

                                                                Geographic Segments
   • Reduced CEO direct reports from 25 to 13
                                                Group      UK   CE   CO   W/E   NE    NA
   • Created new Group functional roles         Finance, Treasury, M&A
      – Destination Management
                                                Destination Management
      – Ecommerce
                                                Operations
      – Operations
                                                Ecommerce
   • Brought in experienced external hires
                                                Human Resources
      – Paul Hollingworth, CFO
      – Simon Breakwell, Ecommerce Advisor
                                                Strategy
      – Derek Woodward, Company Secretary




Page 15
Maintained high customer satisfaction in all markets

Primary local market customer satisfaction measure (in %)
                                                                                                               FY08
                                                                                                96%     96%    FY09



                                                                                             Northern Europe

                                                                     80%    81%

                   91%     91%                                                            72%     73%

                                                                     UK & Ireland

                  North America                                            87%      88%   Central Europe




                                                                         Western Europe




    Source: Thomas Cook local market customer satisfaction surveys

 Page 16
Received extensive trade and consumer recognition




Page 17
Enhanced our leading portfolio of travel brands
                      Global umbrella brand




                       Major local brands




                        Other local brands




Page 18
Made material progress in maximising mainstream

   • Increased mainstream travel revenues by 11%, despite capacity cuts

   • Grew mainstream travel EBIT margin by over 30%

   • Increased online distribution to more than 60% in some markets

   • Grew controlled distribution to more than 80% in some markets

   • Strengthened strategic destinations, particularly medium haul

   • Focused product on 4/5*, all inclusive and exclusive & differentiated concepts




   Source: Management analysis and estimates

Page 19
Grew independent revenues by over 50%

   • Increased independent travel revenues by over 50%

   • Created one of the leading wholesale travel businesses
      – Hotels4U, Gold Medal and TriWest deals strengthened position

   • Continued to be a leader in cruise retail

   • Built thomascook.com into a top travel website with 3m users a month¹

   • Strengthened position in scheduled package market through acquisitions




   Note: ¹Monthly unique users in the UK
   Source: Management analysis and estimates
Page 20
Extracted value from financial services

   • Acquired India’s largest travel and foreign exchange business
      –Thomas Cook India with over 50% foreign exchange market share¹

   • Entered airport Forex market in UK (winning last 2 tenders) and India

   • Increased UK foreign exchange market share by ~75% since 2008

   • Moved to a single Group-wide insurance underwriter

   • But, curtailed ambitions in credit card business due to market conditions




     Note: ¹ Share of the regulated market
     Source: Management estimates; YouGov
Page 21
M&A strengthened position & solved key challenges
   Successfully completed and integrated 14 acquisitions:

   • £450m consideration, 5-7x EBITDA paid depending on profile

   • Bolstered mainstream and significantly enhanced independent

   • Addressed key markets such as France, Canada and the UK

   • Grew in emerging markets, reacquiring Thomas Cook India and Egypt

   • Created value with ROIC to exceed cost of capital overall




Page 22
Delivered on our integration promises

   Integration highlights                                Merger synergies delivered/ expected

   • Successfully merged the two groups
                                                                                   £215m
                                                                        £205m
   • Cultural and physical integration complete
                                                                                             2010 target
                                                             £142m
                                                                                               £155m¹
   • Exceeded synergy targets

   • Thomas Cook brand in all source markets

   • Delivered everything ahead of schedule
                                                             FY08        FY09      FY10e

                                                                 Delivered        Expected


   Note: ¹ target was set in Euros at the time (€200m)

Page 23
Significantly grew revenue, profit and margin

    Revenue in £m                               EBIT p.e. in £m          EBIT margin in %

                    +18%                                  +70%                    +45%


                                    9,269
                     8,754¹
                                                                  415                       4.5%
                                                                                   4.2%
     7,879                                                 366
                                                                          3.1%
                                                 244




      FY07           FY08           FY09         FY07     FY08    FY09    FY07     FY08     FY09



Note: 1Revenue restated in 2009 Annual Report

Page 24
In summary, how did we do?

   • Create a single, customer-focused, Group culture

   • Develop management into an industry leading and united team

   • Maximise the value of mainstream through margin and capacity management

   • Increase independent travel revenues by 50%

   • Significantly grow travel-related financial services

   • Grow through M&A, with a focus on consolidation and emerging markets

   • Integrate two businesses and deliver €200m of synergies


                     Significantly grow top line, profit and margin

Page 25
Strategic progress case studies
Key strategic challenges we faced in 2007


  North America     How to succeed in a market with no barriers to entry and huge overcapacity?



  France            How to restructure a loss making business with a weak market position?



  Germany           How to make profits in an unconsolidated and highly competitive market?



  Northern Europe   How to defend market leading margins of 8-9%?




Page 27
      How to succeed in a Canadian market with no
        barriers to entry and huge overcapacity?

          Michael Friisdahl – CEO North America




Page 28
North America objectives



          • Strengthen leadership position in leisure travel market


          • Reduce risk stemming from mainstream overcapacity


          • Achieve 5% margin




Page 29
Canadian leisure travel market overview

   Canada leisure travel by segment                      Market characteristics

   CAD $b                                       CAGR     • Destinations: USA, Europe, Mexico, Caribbean
                                               FY08-13

                                20                       • Winter focus Mex/ Carib, summer focus Europe
                                                5.7%
                                                         • Overcapacity in mainstream and no entry barriers

                         Independent                     • Highly fragmented retail distribution
                                                6.0%
                            (56%)
                                                         • Independent larger more stable market

                                                         • Three major players in the overall leisure market
                       Independent
                      Wholesale (23%)           6.0%
                                                          – Thomas Cook, Transat, Sunwing/ TUI
                     Mainstream (21%)           4.8%
                                                          – Transat and Sunwing/TUI mainstream focused
                             2008
                   Thomas Cook Focus
   Source: Euromonitor, management estimates

Page 30
2007 Canadian strategic review

   Thomas Cook situation

   • Mainstream focus, with some independent
   • Seasonal business, loss-making in summer
   • EBIT margin of 1.3% in FY07                      Options:
   • Provides winter utilisation for UK aircraft      • Exit North America market


   Market environment                                 • Consolidate mainstream


   • No barriers to entry – consolidation difficult   • Refocus business
   • Significant price competition in TO market
   • Fragmented retail distribution
   • Independent wholesale market attractive



Page 31
Implementation of strategy

                2007                                   2008                           2009

          Strategic review

                       1     ID TriWest

                                          Due Diligence

                             Deal completed Aug 2008

                                                       2      Integration

                                                                        3 Continued profit improvement


                                   Three key steps in the process

Page 32
1     Target identified – TriWest

          • TriWest a leader in independent wholesale, with two main brands (Fun Sun, Intair)
          • FY07 revenues of CAD$172m, EBIT of CAD$13m, total staff of 565 – high synergy potential
          • Strength in markets where Thomas Cook had limited presence, especially Quebec
          • Company with year round profitability and a wider destination reach



    FIT¹ Wholesaler                                      Air Consolidator

    • Non-risk                                           • Largest Canadian air consolidator
    • Strength in Western Canada                         • National presence, strength in Quebec
    • Air, hotel, transfers, car, cruises, attractions   • Net rates, published fares
    • Flexible departure dates                           • 70 airline partners
    • Flexible duration                                  • Market leading web booking engine

    Note: ¹ Flexible Independent Travel
    Source: Management estimates
Page 33
1     Deal gave Thomas Cook a market leading position

    Independent wholesale                            Independent wholesale & mainstream

    Market share                                     Market share

                                                                                 Transat
                              25%                                     23%        TCNA
                                         TCNA             33%                    Sunwing
                                         Tour East
                                   6%                                            TUI
            64%                          Jade                              17%
                                  5%                       6%                    ACV
                                         Other
                                                             8%      10%         WJV
                                                                                 Other
                                                                3%


                  Thomas Cook a leading player in Canadian leisure travel

    Source: Management estimates, FY09

Page 34
2     Integration approach
    Centre of service excellence & cost leadership                        Product preference       Channel preference


       Service                    Product              Technology
                                                                              Mainstream
  • Hotels & Resorts         • Single contracting   • Common                   package
                                                                                                  GDS
  • Customer
                               team                   infrastructure                                              Travel
    Service                  • Joint product        • ‘Product Gateway’                                           Agent
                               development
  • Sales &                                         • Dynamic
    Marketing                • Leverage joint         packaging              Independent
                                                                              component
                                                                                               Call Centre
                               volume
  • Accounting
                             • Leverage Group
  • Group
                               buying power
    Commercial
                                                                             Independent
                                                                               dynamic            Web
                                Our People                                     package
                                                                                                                Consumer
    • Cultural integration
    • Thomas Cook Vision and Values
                                                                               Financial
    • 3 year growth in employee survey scores                                  Services
                                                                                                 Other




                                                Delivered CAD $16.5m in synergies
    Source: Management estimates

Page 35
3     Profits increased by CAD $20m and margin by 3.2%pts

    FY08                                                     FY09
    CAD $m                                                   CAD $m                32
                                                                    25
            17
                                                      12
                                                                           7




                                    -6
          Winter               Summer                Total      Winter   Summer   Total

 EBIT margin:                                        1.6%                         4.8%



                      Significantly grown profits and smoothed seasonality

    Note: Winter refers to H1, Summer refers to H2

Page 36
Future growth

 • Leverage the Thomas Cook brand to drive consumer awareness and revenue growth


 • Grow independent travel through Thomas Cook online strategy (including B2C)

 • Improve mainstream profitability through product exclusivity and cost savings


 • Continue to develop and leverage service excellence and cost leadership


 • Grow Thomas Cook Financial Services



                          Maintain market leading margins



Page 37
          How to restructure a loss making French
           business with a weak market position?

          Thomas Döring – CEO West/East Europe




Page 38
France objectives



          Focus on mainstream travel:


          • Turnaround loss making French business


          • Create a platform for future profitable growth




Page 39
West and East Continental Europe – background context

                     Netherlands                                                     West/ East key facts (FY09)
                 Belgium                                Poland
                                                                                      Passengers                   3.3m
                                               Czech
                                                                                      Sales                     €2,139m

                                                       Hungary                        EBIT p.e.                   €99m
                       France
                                                                Hungary               EBIT margin                 4.6%
                                                                                      Employees (FTE)             3,400
                                                                                      Controlled distribution      51%
                                                                                      Internet distribution        13%
                                                                                      Retail outlets             1,102¹
                                                                                      Aircraft (A320)                 6
          Focus of case study
          Other West/ East markets

   Note: ¹Own shops and franchisees combined (Thomas Cook with 574 own shops and 528 franchisees)


Page 40
     France market characteristics

        Market dynamics                                                             Competitor overview (FY09)¹

        • Domestic largest part of the travel market                                                               Retail Turnover
                                                                                                                                   Aircraft
                                                                                                                  outlets²  (€m)
        • €5b TO market; mainly international travel
                                                                                        Thomas Cook                 660      666       0
           – French speaking destinations most popular
                                                                                        TUI                         490     1,090      8
           – High proportion of long haul
                                                                                        Fram                        218      460       0
           – Top 4 players account for ~50% of market
                                                                                        Look/VAT                    49       469       0
           – Strong high street distribution
                                                                                                            Thomas Cook is:
                                                                                                            • Number 1 in retail
                                                                                                            • Number 2 in TO

        Note:   ¹ Club Med excluded as considered as an integrated hotelier
                ² Own shops and franchisees combined (Thomas Cook with 305 own shops and 355 franchisees)

     Page 41
41
FY04 to FY06 – a period of low profitability

   Gross retail sales in €m                            EBIT p.e. in €m

                           725                                              2.2
                                                                                   0.9
                                                             -8.1



          704                             704




          FY04            FY05           FY06               FY04            FY05   FY06

            Low profitability due to:
            • Business dominated by retail, only small Tour Operator presence
            • Barriers to change:
                 – Three consecutive top management changes in five years
                 – Two unsuccessful restructures and ‘social plans’


Page 42
Transformation plan launched in FY06



          1•   Restructure existing business


          2•   Grow Tour Operator


                – Growth of in-house Thomas Cook Tour Operator


                – Acquisition of Jet Tours




Page 43
1    Restructure existing business

    Overhead cost reduction (€m)                   Restructuring FY06 – FY09

                                           37.0    • Overhead costs reduced by 25%
                                    8.6             –Tour operator and retail costs
                             2.4
                                                    –Merger synergies e.g. IT and Finance
                     5.3
                                                    –FTE’s reduced by >400
            13.7
                                                   • Retail efficiency

                                                    –14% increase in average sales per FTE
      7.0
                                                    –In-house TO sales rose from 25% to 47%
      TO    Retail   IT    Finance Other   Total




Page 44
2     Tour Operator growth

    Growth of in-house Tour Operator                                                  Change in market share

    • 16% pa growth between FY06 and FY08                                                                        13%
    • Focus on captive distribution
    • Focus on concept hotels                                                                                  Jet Tours
                                                                                                                  6%
    • Built up our online proposition


    Acquisition of Jet Tours                                                                          5%

                                                                                                            Thomas Cook
                                                                                                                7%
    • Thomas Cook becomes No 2 in France
    • Fully integrated within 12 months
    • Achieved synergies ahead of expectations                                                       FY07       FY09



    Note: Club Med excluded from market share calculations as considered as an integrated hotelier

Page 45
     Created a much stronger business

        In-house distribution       Tour operating   Third party flying     Concept hotels
            (47% of total)
                                                         Air France         Clubs

                                                        XL Airways           23

                                                         Transavia           28

                                                       Europe Airpost        21
         3rd   party distribution
                                                                             5




                              Strong base in all parts of the value chain

     Page 46
46
Substantial EBIT and margin increase

   Net sales in €m                                                       EBIT p.e. in €m


                                                              666
                                             31%
                                                                                                         236%
                                                                                                                    33.4
                                                                                                             21.9
                                                   388
                273         294                                                                       6.9
     261                               242                                        2.2      0.9
                                                                                                  `




                                                                           -8.1

    FY04       FY05        FY06       FY07       FY08        FY09         FY04    FY05   FY06         FY07   FY08   FY09
                                                                                           0.3%                     5.0%
    CAGR             EBIT
   FY06-09           Margin


   Note: FY06 and prior years based on internal management information

Page 47
Future growth

   • Growth of Thomas Cook online


   • Growth of Jet Tours by leveraging restructured third party distribution


   • Growth and margin through more and new club products e.g.


   • Maintain cost leadership and drive further efficiency improvements




Page 48
          How to make profits in an unconsolidated
          and highly competitive German market?

          Peter Fankhauser – CEO Central Europe




Page 49
Germany objectives



          • Turnaround a €160m loss making business


          • Become the most profitable German travel company


          • Create platform for future profitable growth




Page 50
Germany is Europe’s largest, but most fragmented, market

   Thomas Cook in Germany                       German travel market characteristics

   A leading player, with 4 major brands        • Europe’s largest travel market; 50m pax p.a.

                  – Retail brand
                                                • Highly competitive and fragmented market
                  – Up-market Tour Operator


                  – Value for money brand        – Full price transparency; high price competition
                  – Mass market Tour Operator
                                                 – Capacity pressure from aggressive smaller carriers

                  – Last minute brand
                                                 – Highly fragmented retail landscape

                  – Airline




Page 51
Thomas Cook is the most profitable player

   EBIT margins by company
   FY09 in %

                                        Thomas Cook                                                       2.3     3.3


                                                        TUI                                         1.6


                                                      Rewe¹                       0.8


                                                  Alltours                     <1.0


                                                        FTI                    <1.0


                                                                                      ~1.0
                                                       Öger


                                                                                        EBIT margin as reported
                                                  Tour Operator only

                                                  Tour operator plus airline            EBIT margin estimated



   Note: ¹ Margin 07/08, no later figures available

Page 52
Turnaround was driven by four key initiatives



          1•   Changing the business model, refocusing the Airline and Tour Operator


          2•   Developing a more flexible purchasing strategy


          3•   Significantly reducing costs in the Tour Operator, cost leadership


          4•   Improving airline efficiency




Page 53
1    Airline and Tour Operator refocused

          Rationale for change:

          • Level of integration much lower (one third in-house)

          • 28 airports; Condor focus on the 10 most profitable



                                                    Pricing
                                                   Market rates

                          Airline                                     Tour Operator
                                                  Organisation
                                                 Separate teams
                                                   Strong links


                                                    Capacity
                                                 Condor first right
                                                    of refusal

Page 54
2    Flexibility from purchasing strategy

    Benefits of new strategy                Percentage of hotel bed commitments

    • De-risks overall capacity                            -70%
      – Fewer guarantees and deposits
      – Limited ownerships                        16.1%

    • Gives competitive advantage
      – Average market levels much higher
                                                                   4.9%
    • Less need for discounting

    • Better margins as a result
                                                   FY03            FY09




Page 55
3     Significant reduction in Tour Operator cost base

    Major overhead cost cutting initiatives                    Key drivers of cost reduction

                         • Launched 2003                       • Product portfolio cut by ~15%
       Project
                         • €80m of savings
      ‘Diamant’                                                • Reduction of FTEs and OPEX
                         • Realised within 2 years
                                                               • Streamlining of processes
                         • Launched 2007                       • Commission reductions (€16m p.a.)¹
          Project
                         • €20m of savings
           ‘54’
                         • Realised within 2 years


                         • Started 2009
          Project
                         • €20m of savings           Ongoing
          ‘Fokus’
                         • Targeted for FY 2010


    Note: ¹ Based on FY09 costs

Page 56
4    Airline improved productivity and cost position

    Block hours/aircraft/day          Seat load factor (%)            Passengers per FTE

                  +26%                             +6%                             +28%

                                           84.4           89.2                            2,939
                          12.2
                                                                           2,299
          9.7




          FY03            FY09             FY03           FY09             FY03           FY09

                 Profit improvement programmes:
                 • FY03 profit improvement programme with total impact of €160m
                 • FY08 new programme ‘COMPETE’ launched with target of €100m

Page 57
Result – turnaround and ongoing profit improvement

   Net sales (€m)¹                                                            EBIT p.e. (€m)¹

                                                                                                    +273

                    3,371                                                                                  114
                                                  3,317
                     455                                                                                   55
                                                   797
                                                                                                            59

                                                                                             -89
                2,916
                                                 2,520
                                                                                             -70

                                                                                             -159
                FY03²                             FY09                                     FY03²           FY09
                                                                             Margin         -4.7%          3.3%
          Airline           Tour Operator

   Note: ¹ Tour Operator sales plus external Condor Sales, Tour Operator EBIT plus Condor EBIT
         ² Adjusted and pro forma figures, not directly comparable, EBITA basis

Page 58
Future growth

   • Extend mainstream ‘live pricing’ model to drive growth


   • Expand online share, introduce ePackaging and grow OTA business

   • Extend exclusive and differentiated concepts like


   • Continue to drive cultural change through Group values


   • Centralise overseas purchasing and functions to reduce costs


   • Continue to look for opportunities to consolidate the market




Page 59
          How to defend market leading margins
               of 8-9% in Nordic markets?

          Sam Weihagen – CEO Northern Europe




Page 60
Northern Europe objectives



          • Defend industry leading margins in mainstream


          • Strengthen market leading position


          • Create platform for future growth




Page 61
Market leading position in mainstream travel

   Nordic mainstream travel market (%)                                    Market dynamics

     100%           100%       100%         100%        100%              • 3 major players; consolidated market
                    12           7
                                 4                         18             • Limited dependency on third party travel agents
                                               25
          31        11
                                 23
                                               12          20             • High online penetration
                    21
          19
                                 29            18                         • Most local LCCs¹ regional only or loss making
                                                           27
                    25
          22                                                              • Kuoni buying smaller players
                                               21

                    31           37                        35             • TUI adding capacity recently
          28                                   24


   Nordics Sweden Norway Denmark Finland

          Thomas Cook                TUI                Kuoni
          Primera                    Finnair            Others
   Note: ¹ LCCs = Low Cost Carriers
   Source: Company financial statements; Thomas Cook Management analysis and estimates
Page 62
Six key success factors to maintain margin advantage

          1•   Highly integrated business model


          2•   Leading brands and customer experience


          3•   Exclusive and differentiated concepts


          4•   Channel shift from offline to online


          5•   Customer focused organisation


          6•   Cost efficient airline


                        Maintain industry leading margins of 8-9%

Page 63
1    Highly integrated business model

                                Vertically integrated Tour Operator

          Destinations & Hotels                     Airline                  Distribution
                                       +                           +



          • 90% exclusive product          • 85% in-house flying       • 83% controlled
          • 25% own concept hotels                                     • 54% online
          • Number one or two in all
            major destinations



                               Captures more of the value chain

Page 64
2     Market leading brands and customer experience

    Market leading brands                                Differentiated customer experience

    • Ving – biggest travel brand in Sweden and Norway • Positive customer feedback year after year

    • Spies – biggest travel brand in Denmark            • Over 96% customer satisfaction

    • Tjäreborg – highly trusted brand in Finland        • 96% customers recommend us to friends

    • Ving.se voted the best travel website in Sweden¹   • Loyalty driven by exclusive hotel concepts




    Page 65
    Note: ¹ also voted best overall website in Sweden

Page 65
   3      Exclusive and differentiated concepts

         • 27 unique concept hotels under three brands

         • Focus on key destinations that we control

         • 40% higher margins driven by:
          – Customer loyalty
          – Earlier bookings
          – Price premium achieved




   Page 66
- 66 -
4     Online sales growth

    Channel shift offline to online                   Online sales as a % total

    • Online sales from 18% in 2003 to 54%¹           80

                                                      60
    • Retail presence reduced from >100 to 11 shops
                                                      40
    • Award winning web platform
                                                      20

    • Tailor made reservation system drives yields     0
                                                            2003     2005         2007     2009


                                                           Denmark   Finland      Norway   Sweden




    Note: ¹ Total Thomas Cook Northern Europe

Page 67
4    New customer friendly website




Page 68
5     Customer-focused organisation

                    “Functional excellence”                                       “Local distribution”

      Hotels & Resorts                            Services
  • Rooms produced to                  • Contracting hotel room capacity                    Sweden
    defined concept standards          • Quality management and H&S
  • Food and beverage sales            • Resort operations
  • Minishop sales                     • Hotel capacity optimisation



              Airline                          Group Yield                                  Norway
                                       • Contracting of flight seats           Overhead
  • Seats produced at lowest cost
                                       • Flight planning optimisation          allocation              Sales &    Customers
  • Seat at defined service standard                                          at standard             marketing
                                       • Coordinate price curves
  • Tax free sales to passengers                                                  cost
                                       • Coordinate supplements
                                                                                            Denmark

                                             IT and systems
                                       • Development of common websites
                                       • Capacity planning & yield systems
                                       • Owner of all IT systems/ equipment                 Finland
                                       • IT operation and maintenance




Page 69
   6      Cost efficient airline

         Indexed cost per available seat kilometre

         A330 = 100
                                                                                     117
                                                      108
                          100




                          A330                       B767                        A320

               • Operate three A330-300s – the world’s most cost efficient mid-haul aircraft

               • Highly integrated with the tour operator with 72% in-house flying

               • World class duty free sales revenue – £57 per passenger


   Page 70
- 70 -
Result – continued industry leading margins

   EBIT Margin (%)                                                         EBIT/ Passenger (SEK)


           8.9
                                                8.2                               707              716
                   6.5 6.3
                                                         6.0
                                                                                        499 466          491




                                                                    N/A¹                                        N/A¹

                 FY08                                  FY09                             FY08             FY09

                                                  Thomas Cook               TUI           Kuoni

   Note: ¹ Kuoni FY 2009 results not available at time of writing
   Source: Company financials
Page 71
Future growth to protect number one position

   • Increase controlled distribution from 83% to 90% and online from 54% to 80%

   • Increase share of concept hotels from 25% to 30% of total bed capacity

   • Improve value proposition to grow the family and 50+ segments

   • Grow independent travel business, focusing on major destinations

   • Continue cost efficiencies, reducing overheads and commissions

   • Continue focus on duty free sales in the airline


           Deliver top line growth and maintain 8-9% margins


Page 72
                     Summary

          Manny Fontenla-Novoa – Group CEO




Page 73
We have made considerable progress so far

• Successfully completed integration and turnarounds

• Further increased industry leading EBIT margins to 4.5% and profits by 70%

• Grown top line, including over 50% increase in independent travel

• Acquisitions continued consolidation and drove independent/ emerging markets growth

• Created a single Group culture and a truly united management team

• Continued to put the customer at the heart of everything we do




   Source: Management analysis and estimates

Page 74
          We have the strategy, structure, people,
              brands, scale and ambition to
           significantly grow top and bottom lines




Page 75
Strategy for Growth
What we will cover in this section


          • Key trends in our market place

          • Our strategy for growing top and bottom line

          • Case studies of major strategic initiatives

          • Summary of our medium term growth potential




Page 77
              Key trends in our market place

          Jürgen Büser – Group Strategy Director




Page 78
Economic environment is improving

   Real GDP quarterly growth                              Unemployment rate

    2%                                                    12%


    1%                                                    10%                                   Euro zone
                                              Germany
                                              Euro zone                                         UK
    0%                                                    8%
                                              UK                                                Germany
   -1%                                                    6%


   -2%                                                    4%


   -3%                                                    2%


   -4%                                                    0%
      2004     2005    2006   2007   2008   2009            2004   2005   2006   2007   2008   2009
       Q4       Q4      Q4     Q4     Q4     Q4              Q4     Q4     Q4     Q4     Q4     Q4


   Source: IMF; OECD

Page 79
However significant uncertainty lies ahead
                            • Household debt levels remain high
              Debt
                            • Financial institutions debt declines to below pre-crisis levels

                            • Early signs of inflation in emerging markets
          Price stability
                            • Europe & US outlook uncertain

            Health of       • Unemployment and tight consumer credit dampen consumption
            consumer        • Retirement benefits still under pressure

         Health of          • Significant disparity in capital cushions
     financial services     • Impact of tax and deregulation currently unclear


      Trade balances        • Trade imbalances continue, though reduced in UK and US


                            • Public debt at historical high in developed countries
          Sovereign debt
                            • Higher taxes and austerity packages likely


Page 80
 Our core markets account for ~30% of global travel spend

        World leisure travel market                                            Thomas Cook core markets²
        £820bn¹
                                                                                    Canada        UK      Belgium
                                                                                                  Germany Netherlands
                                                                                                  France  Nordics³
                   Rest of                        Corporate                                          Corporate
                                   Netherlands,                                                                         Corporate
                   World           UK, Belgium,
                   22.1%           France, Germany
Japan                                25.8%
3.0%
                                                              Leisure
                                                              Nordics
             US
                                                                4.8%
            8.4%
                                   Other
                                                                                                   Leisure
               BRICs              Europe                   Canada                                                        Leisure
                8.7%              24.4%                     2.8%



        Thomas Cook core markets                        Other markets

  Note: ¹Excludes spend on food, drink, fuel, entertainment, shopping, etc; ² These ten markets
  account for over 90% of total Group revenues; ³Sweden Norway, Finland, Denmark
  Source: UNWTO; Euromonitor, Thomas Cook Management analysis and estimates
  Page 81
How we define our addressable market place
                    Leisure travel market

    “Asset light”                           Travel intermediaries
                              Intermediaries between ‘capacity’ suppliers and consumers

                       Mainstream                  Independent                Travel-related
                         travel                       travel                Financial Services
                        Pre-packaged        +   Individual components   +        Travel money
                      holidays, primarily           or dynamically             Travel assurance
                      charter packages            created packages              Travel finance




   “Asset heavy”                                Direct suppliers
                        Asset owners supplying ‘capacity’ direct to consumers or intermediaries



                                            Thomas Cook Group focus


Page 82
Our market place in 2009
          Leisure travel market 2009
                                                                    Thomas Cook definition
                         £274b                   £96b
                                                FS £5b                Financial Services
                      Travel                 Other £9b
                  Intermediaries            Fly-drive £7b
                       £96b                  Cruise £6b
                                           City break £7b
                                                                      Independent travel
                                          Accom only £11b


                 Direct Suppliers          Flight only £22b
                      £178b

                                              Package                 Mainstream travel
                                            holiday £29b


                    Travel market      Travel intermediary market

   Source: Euromonitor

Page 83
Key trends affecting our market place

  1       Major travel markets continue to grow faster than the general economy


  2       Intermediaries continue to capture around a third of total expenditure

  3       Mainstream travel market will continue to be large and to grow in value terms

  4       Independent travel to drive majority of the growth in the intermediary market

  5       Online growth will be faster than offline; growth in both mainstream and independent

  6       Thomas Cook key destinations will continue to grow fast

  7       Consumers will continue to drive change in the industry


Page 84
1     Tourism has grown faster than GDP in spite of shocks

                                                                                                  Current global
    350                                                                                           financial crisis
                                                                                                                           Intl. tourist arrivals
    300                                                                        9/11

    250                                                                                                                    Real world GDP

                                 Global                                                 SARS
    200                        economic
                               slowdown
    150

    100

    50
          '80    '82     '84     '86    '88     '90     '92     '94     '96   '98     '00   '02      '04    '06      '08


    Notes: Numbers indexed to year 1980
    Source: UNWTO World Tourism Barometer, IMF World Economic Outlook

Page 85
1     Travel forecast to continue to grow faster than GDP

                                                                                                              CAGR
130
                                                                                                             (06-14)
                                                                                    Real major European
                                                                                                              3.0%
                                                                                    travel markets growth

120



110                                                                                     EU Real GDP growth    1.1%


100



 90
          2006    2007      2008      2009      2010      2011     2012   2013   2014


    Notes: Numbers indexed to 2006
    Source: Euromonitor; IMF World Economic Database and Outlook

Page 86
2     Intermediaries to continue to capture a third of the market
    Leisure travel market
                                                                       CAGR
                                                                      (09-14)¹
                                                       £312b           2.7%
                                           £274b
                                                   Intermediaries
                                                       £110b           2.8%
                                           £96b



                                                   Direct Suppliers
                                                        £202b          2.6%
                                           £178b




                                           2009         2014

    Intermediaries:                        35%          35%
    Note: ¹ Growth rates are real growth
    Source: Euromonitor
Page 87
3&4       Mainstream remains large; Independent drives growth
   Travel intermediary market                                   CAGR      Growth
                                                               (09-14)¹   (09-14)¹
                                                   £110b         2.8%      £14.1b
                                                   FS £5b       1.1%       £0.3b
                                          £96b
                                          £4b



                                                 Independent    3.2%      £10.6b
                                                    £73b
                                          £63b




                                                 Mainstream     2.1%       £3.2b
                                          £29b     £32b


                                          2009      2014
   Note: ¹ Growth rates are real growth
   Source: Euromonitor
Page 88
5     Online growth will be faster than offline
    Travel intermediary market                                                                      CAGR      TCG market
                                                                                                   (09-14)¹   share FY09²
                                                                                                     2.8%        ~9%
                                                                                         £110b
                                                                                         FS £5b     1.1%
                                         £96b
                                          £4b
                                                                                    Online £34b     7.3%         ~6%
                                         £24b




                                         £68b                                       Offline £72b    1.1%        ~11%




                                         2009                                            2014
    Online as a %:                       25%                                              31%

    Note: ¹ Growth rates are real growth; ²TCG market share figures are management estimates
    Source: Euromonitor
Page 89
5     Online growth in both mainstream and independent
    Online travel intermediary market
                                                                                                   CAGR      TCG market
                                                                                                  (09-14)¹    share ‘09²
                                                                                         £34b       7.3%        ~6%
                                                                                    Mainstream
                                                                                       £8b         6.0%        ~20%
                                         £24b
                                          £6b

                                                                                    Independent    7.7%         ~2%
                                                                                        £26b
                                         £18b




                                         2009                                             2014

    Note: ¹ Growth rates are real growth; ²TCG market share figures are management estimates
    Source: Euromonitor
Page 90
6     Strategic destinations continue to grow
    International Tourist Arrivals (m)

     Turkey                                                 Egypt                       Spain1

              +421%                                                +410%                      +68%

                                                                                 15                    57
                                     27
                           25                                              12                                51
                                                                                                 48

                                                                                        34

                 10                                                  5
          5                                                   2


       '90       '00       '08      '14e                     '90     '00   '08   '14e   '90      '00   '08   '14e



    Note: ¹ Includes Mainland Spain, Balearics & Canary Islands
    Source: UNWTO; Euromonitor; Management estimates

Page 91
7    Other major consumer trends

    Consumer                   • Consumer confidence will increase as economic environment improves
    confidence                 • Big ticket ‘main’ holiday will continue to be top spending priority


    Product                    • Continued popularity of All Inclusive products
    preferences                • Growth in destinations outside of Euro zone (such as Egypt & Turkey)

                              • Consumers expect ever greater product variety, flexibility and security
    Travel
    preferences                      –   Holiday length, regional flying, exclusive/differentiated hotels
                                     –   Emphasis on ATOL-protection following non-bonded company collapses
                                     –   Higher awareness of ‘green’ issues, but limited effect on booking behaviour


    Distribution               • Further internet growth; used for research, booking and reviews
    channel                    • Consumers increasingly comfortable with dynamic packaging



    Source: Thomas Cook Management

Page 92
In summary, implications for Thomas Cook

   • Overall travel markets to return to growth, although economy may impact short term

   • Mainstream travel stable in passenger terms, but growing in value

   • Strong growth in independent travel

   • Considerable growth in online distribution
      – Mainstream growth enhanced by channel shift from offline to online
      – Independent growth from channel shift and OTA market share gain


   • Continued growth in medium haul destinations, All Inclusive and 4/5*


                   Thomas Cook strategy addresses all these points



Page 93
          Medium Term Growth Strategy

          Paul Hollingworth – Group CFO




Page 94
Observations

  • Operations – large complex business focused on the customer


  • People – wealth and depth of experience


  • Finance – renewed focus on cash management


  • Corporate – fairly new to public company life


  • Open to change – ambitious change programme; sign of greater organisational maturity



                Lots of energy, lots to do, lots of opportunity



Page 95
Our strategy continues to serve us well
                                                                            Vision




                           Strategic objectives
                                        Strengthening our business and investing for growth

                    Growth drivers




                           Maximise                          Become a                   Become                 Capture
                           value of                           leading                 the leading            growth and
                          mainstream                       independent               travel-related         value through
                                                          travel provider               financial             M&A and
                                                                                         services            partnerships
                                                                                        provider




               Enablers
                     Product                      Technology        Customer insight            Brands            Financial rigour

           Values
                     P                                R                      O                        U                     D
               Pioneering our                       Results           Obsessed with          United as one team        Driving robust
                   future                         orientated         customer service                                    decisions


Page 96
There is top line growth in our model

                  £9.3b           Mergers & Acquisitions
                                  • New high growth and/or high margin markets (e.g. BRIC markets)
             Financial Services
                                  • Bolt-on/ consolidation opportunities
               Independent        • Continued growth from completed acquisitions
                  travel
                                  Travel-related financial services
                                  • New markets and product line extensions
                                  • Maximising distribution and cross-sell opportunities

                Mainstream
                  travel          Independent travel
                                  • OTA market – Online third party largely a new market for TCG
                                  • Greater wholesale distribution to third party agents
                                  • Growth of scheduled packages (e.g. Thomas Cook Signature)


                                  Mainstream travel
                                  • ASP increases from better product mix and pricing activities
                                  • Share gain from smaller operators
          FY 2009 Group Revenue   • Channel shift into faster growing online channel



Page 97
We also have a large cost base to go after

                     £8.9b                   Commission & Other £0.6b
             Commission/ Other               • Greater control of distribution and commission rate reductions
                      Fuel                   • Reduced agent costs in-destination



               Aviation excl. fuel           Aviation and fuel £3.3b
                                             • Better buying of aviation services across the Group
                                             • Best practice sharing between airlines e.g. on fuel efficiency



                                             Accommodation costs £3.1b
               Accommodation
                                             • Better buying process and use of Group buying power
                                             • Co-ordination of activities and best practice sharing


                  Other Opex                 Operating expenses £1.8b
                   Personnel                 • Operating leverage; spread fixed costs over higher volumes
                                             • Adopt a common approach to airline, personnel, IT etc.

          FY 2009 Group Costs

    Cost of providing tourism services   Operating expenses
Page 98
We have the initiatives in place to realise our plans

                                                                                                       Stage of delivery
                            Area                          Example initiatives
                                                                                            Started      Progressed        Advanced
                                             Airline synergies                                                
    Mainstream travel




                        Cost efficiencies    Group Destination Management                                     
                                             GLOBE and other IT savings                                       

                        ASPs and trading     Product and mix improvements                                                     
                        margin growth        Better buying and pricing processes                                              
                                             Channel shift offline to online                                  
                        Distribution gains
                                             Third party agent commission reductions                                          
                                             European OTA growth                               
     Independent travel
                                             Scheduled package growth                                         
                                             Foreign exchange market growth                                                   
     Financial services
                                             Improved cross-sell rates                                        
                                             Additional consolidation                          
     M&A
                                             Emerging markets                                                 


                                             Case study topics                     Covered in UK case study


Page 99
Medium term margin growth potential
           Mainstream                Independent                    Financial
                                                                                        M&A           Margin pressure
             travel                     travel                      services


                                    European OTA                                                         Market
      Cost efficiencies                                           Forex growth     New acquisitions
                                        growth                                                         development

               +                            +                            +                +                  +
      ASP and trading                Scheduled                    New product        Disposals of
                                                                                                       Execution risk
       margin growth               package growth                  launches        non-core assets

               +                            +                            +
                                                                Improved cross-
      Distribution gains          Wholesale growth
                                                                   sell rates

               =                            =                            =                =                  =

           110-130 bps               130-150 bps                    10-20 bps            N/A            ~(150) bps



                                                               Total 100-150 bps



   Note: Basis points improvement applies to total Group medium term revenue

Page 100
Medium term objectives and tracking

      Mainstream       • Targeting modest sales growth
        travel         • Improve margins


                       • Increasing proportion of Group sales
      Independent      • Development of OTA business                   Going forward, we will:
         travel
                       • Deliver higher margins than mainstream        • Update regularly on progress
                                                                       • Enhance our reporting
           Financial
                       • Grow revenue and profits                      • Make it easier to track
           services


       M&A and         • Selective acquisitions in emerging markets
      partnerships     • Consolidation/ bolt-ons in existing markets


                Grow sales and margin and increase our cash conversion ratio

Page 101
M&A continues to be part of our strategy



           • Capture growth and value

              – Maximise value in current business

              – New initiatives in existing markets

              – Entry in other emerging markets




Page 102
Opportunities remain in emerging markets

   Outbound travel market growth YoY ’08 -‘12                       International tourism expenditure ($bn)

                       20%
                                                                      UK                                            68.5
           15%         15%                            15%           China                                    36.2
                                                                   Russia                             24.9
           10%                                                      Brazil                     11.0
                                        5%                           India                 9.6
                                                                   Poland                  9.3
                                                                  Mexico                 8.5
       China         Russia           Brazil          India        Taiwan                8.5
                                                                 Malaysia            6.7
    • ‘BRIC’ countries offer largest potential:                 Indonesia          5.4
    • Higher average GDP growth rates                            Thailand          5.2
                                                                Argentina      4.5
    • Growing middle classes
                                                              South Africa    4.2
    • Markets still fragmented                                     Turkey    3.5
                                                                    Egypt    2.9
   Source: UNWTO; Management analysis and estimates

Page 103
Russia opportunity

Market overview                                               Our vision in Russia

 • Fastest growing BRIC travel market                         • Leading Tour Operator with strong distribution

                                                               – Multi-destination Tour Operator
 • 20m passengers p.a. (international and domestic)
                                                               – Retail focus on Moscow and key regions
 • Only 5% of population travels abroad for leisure
                                                               – Leveraging core destinations

 • Similar product to W. European mainstream
                                                              • Leverage existing expertise
   – Beach, especially Turkey and Egypt
                                                               – Brand

                                                               – Bed banks

                                                               – Strong positions in key destinations




   Source: UNWTO; Management analysis and estimates

Page 104
  Sources: Russian Federal Tourism Agency, expert estimates
Our emerging markets presence today


            India     Leading provider of foreign exchange and travel services


            Egypt     #1 in outbound / financial services, significant potential in inbound


           Poland     Leading profitability with strong position in outbound and retail


           Hungary    Market leader in outbound leisure travel

            Czech
                      First footprint and strong growth >50%
           Republic




Page 105
In summary

   • A leading global travel Group, substantially larger than today

   • Mainstream will be more profitable and have grown the top line

   • Independent travel will be the growth engine of the business (retail and wholesale)

   • Online distribution channel to substantially increase

   • Financial services to continue to be a significant contributor to Group profits

   • Profit growth from emerging markets

   • Successfully completed and integrated several strategic acquisitions


                    Medium term margin potential of 5.5 – 6.0%


Page 106
           Refreshments




Page 107
Agenda

Welcome and Introduction          Manny Fontenla-Novoa              0900 – 0920

Strategic Progress Case Studies   Management Team                   0920 – 1000

Strategy for Growth               Paul Hollingworth, Jürgen Büser   1000 – 1045

                                  Refreshments

Growth Strategy Case Studies      Management Team                   1115 – 1225

Summary and Wrap-up               Manny Fontenla-Novoa              1225 – 1230

Q&A                               Management Team                   1230 – 1300

                                  Lunch




Page 108
Growth strategy case studies
Focus on four key medium term strategic initiatives


   Airline synergies   Drive further synergies across our international airlines


   Group Destination
                       Leverage our Group buying power in destination management
   Management


   UK growth           Drive significant top line and bottom line growth in the UK



   OTA growth          Significantly grow online and establish a European OTA business




Page 110
                Drive further synergies across
                   our international airlines

           Ralf Teckentrup – CEO Airlines Germany




Page 111
Airline synergies objectives


                          • Reduce overall costs of Group airlines through:

                             – Better Group-wide coordination

                             – Greater use of Group buying power

                             – Best practice sharing

                             – Working more closely together




   Note: Majority of benefits are in mainstream, although seat-only business part of independent


Page 112
Thomas Cook Group today operates 94 aircraft

                                                                      • 94 aircraft
                                     Northern Europe                  • >17m passengers
                                                                      • >6,200 employees
                                                            11        • Cost base of £2.3b
           Canada
                                          6-8
                                                     1-2
                                                                 Germany
                    UK & Ireland                43
                                                           34
                                                       6
                       Belgium



 x    No. of aircraft (summer season)
      Seasonal optimisation of aircraft

Page 113
Historically limited cross-Group airline cooperation

Management focus up until 2008


 Within individual   • UK merger of Thomas Cook and MyTravel airlines in 2007/2008
  Thomas Cook
                     • Condor merger talks with Air Berlin in FY08; TUIfly/ Germanwings in H2’08
     airlines
                     • Regular efficiency and cost cutting programmes, but priority within each airline
                     • High-level contact across Group airlines, however limited coordination



   Cross-Group       • Transfer of aircraft between UK, Canada & Scandinavia (seasonal optimisation)
   cooperation/
    synergies        • Synergies realised case-by-case in an opportunistic way



           Opportunity to benefit from greater cooperation between airlines


Page 114
Project started to realise benefits from greater cooperation
Airline synergies project

               Phase I: Analysis H1’09                    Phase II: Implementation H2’09 on

• Achieve full cost transparency & comparability       • Implement identified synergy measures

• Analyse performance parameters of all airlines       • Build project structures to improve cooperation

• Identify synergy opportunities from all areas:       • Continuously identify additional measures

  – Sales                  – Catering, Product         • Optimise organisational setup of airlines
                                                         (medium term)
  – Production, Capacity   – IT & Systems

  – Handling, Ground Ops   – Flight Ops, Fuel Saving

  – Fuel Purchasing        – Maintenance




Page 115
Strong implementation organisation set-up to drive results

                                  TCG Airline Board                   • Nine meetings per year
                                 CEOs of the five TCG
                                                                      • Implementation review & approval
                                   airline operations

                    Controlling Group              Project Office     • Module support & financial tracking


                Module 1      Module 2     …               Module 8


  UK              Executives from all TCG airlines working
                  together on project modules 1 - 8:
                                                                      • Regular module meetings
  Condor
                  • Sales                  • Catering, Product        • Responsible for implementation

  Scandinavia     • Production, Capacity   • IT & Systems             • Share best practice
                  • Handling, Ground Ops • Flight Ops, Fuel Saving    • Identify additional measures
  Belgium         • Fuel Purchasing        • Maintenance

  Canada




Page 116
The project has identified a further £35m of synergies

     Total airline synergies (£m)                                                    New measures by Group airline

                               +103%
                                                                                                                        In £m                In %
                                     35                   69
                                                                                     Condor                                16                      45%

                                                                                     UK                                    15                      43%
            34
                                                                                     Scandinavia                             3                     9%

                                                                                     Belgium                                 1                     3%

                                                                                     Total                                 35                 100%
    Annual synergies Additional annual                   Total
    already achieved synergies identified
      prior to 20091     by project

Note: ¹ Synergies realised in Catering (5), Handling (8), Maintenance (6), A/C and Pax Insurance (5) & by seasonal optimisation of aircraft (10)

Page 117
Top eight measures account for £22m of the total (62%)

   New measures by value           Top eight measures

                                   1   Fuel efficiency improvements
   Total = £35m
                                   2   Joint tender for catering supplier

                                   3   Joint tenders/ contracts for rotables/ rotables support

           Further 27              4   Joint negotiations ground handling contracts
           measures
                          Top 8
            £13.3m                 5   Best of breed IT applications/ harmonising systems
                        measures
             (38%)
                         £21.7m
                                   6   Reduce hotel accommodation costs for travel crew
                          (62%)
                                   7   Better fuel purchasing conditions

                                   8   Joint tender B757 C-checks

                                   9   Further 27 measures



Page 118
Around half the benefits will have a P&L effect in FY10

     Cumulative phasing of synergies by year (in £m)
                                                                                                                35
                                                                                      28

                                                                19


                                    2

                                 FY09                          FY10                 FY11                      FY12

Main measures: • Ground handling                        • Inbound catering   • Outbound catering       • Optimised
                                                                                                         production
                      • Excess baggage                  • HOTAC¹             • Light-weight trolleys
                                                                                                       • Full potential of all
                      • Overseas line                   • Fuel purchasing    • Rotables support          other measures
                        maintenance
                                                        • Fuel efficiency    • C-Checks



Note: ¹ Hotel and accommodation costs for travel crew

 Page 119
In summary

   • Project generates significant additional benefits from airline cooperation


   • Strong implementation organisation in place to deliver


   • Target for FY09 met


   • On track to hit targets in FY10 through to FY12


   • Hard to replicate



           Project structure will deliver more savings in the medium term


Page 120
              Leverage our Group buying power
                 in destination management

           Pete Constanti – CEO Group Destination
                       Management




Page 121
Group destination management objectives


           • Unlock value through greater Group coordination


           • Reduce accommodation costs


           • Reduce other destination-related overheads


           • Protect and enhance product portfolio




Page 122
Introduction to destination management

 Source market


                      pa                          Destination
                                                  Destination
                        ss
                           en
                              gers                Incoming agents
                                                  Incoming agents
                                                  • Owned or third party agents
                                                  • Owned or third party agents
                                                  • Handling, transfers etc.
                                                  • Handling, transfers etc.
                                                  Customer Service
                                                  Customer Service
                                                  • Customer facing teams/ reps
                                                  • Customer facing teams/ reps
     Content // data                              • Management of teams
                                                  • Management of teams
     Content data
     • Photos & descriptions
     • Photos & descriptions                      Accommodation
                                                  Accommodation
     • Local area info.
     • Local area info.                           • Hotel rooms and bed rates
                                                  • Hotel rooms and bed rates
     • Hotel allotments & rates
     • Hotel allotments & rates                   • Overseas purchasing
                                                  • Overseas purchasing
     • Other information
     • Other information




            Historically destination management performed by local markets

Page 123
Key focus is reduction of accommodation costs

   Cost of providing tourism services              Destination management focus
   FY09 £m
                                                   • Accommodation costs a key focus

                 157                                  – Account for ~30% of total revenue
           388
                                                      – Reduce overall levels to improve margin
                                                      – Also use savings to stimulate demand
           801                 Accommodation
                               Aviation exc fuel
                       3,124                       • Other costs targeted
                               Fuel
           2,548               Commission             – Incoming agent spend
                               Other                  – Overseas customer service teams
                                                      – Content sourcing and management




Page 124
Also opportunities to support top line growth

   Higher average • More exclusivity agreements and access to higher margin product
       prices     • Defence of strategic destinations and key hotels
                     • Group approach to extending breadth of product range



      Increased      • Best practice sharing on in-destination revenue generation
    in-destination
       revenue       • Increased sales of tours, tickets, excursions, etc.


        Better       • Better quality content in the right place at the right time
      conversion
        rates        • Improved conversion rates from enhanced content management




Page 125
Four major activities to unlock value



           •
           1    Move to a single incoming agent per destination


           •
           2    Create a single management structure for overseas teams


           3•   Take a Group approach to content sourcing and management


           4•   Take a more centralised approach to overseas purchasing




Page 126
A new approach to activities in-destination
1
     Incoming    • Move to a single handling agent in each major gateway/ destination
      agents     • Manage centrally to get best rates and protect & enhance product range


2
  Overseas      • Create a single management structure for overseas teams
   customer
service & sales • Strengthen service proposition and share best practices


3
      Content    • Develop a Group-wide approach to content sourcing and management
     and data
    management   • Remove duplication of activities and improve overall content quality


                  Targeting savings of approximately £10m p.a.

Page 127
More centralised approach to overseas purchasing
4
     Overseas    • Group approach to:
    purchasing      – Key international hotel chains
                    – Strategically important destinations

                 • Local management of segment-specific properties and ‘Lates’ buying

                 • Key aims are:
                    – Develop a consistent approach to destination strategies

                    – Achieve the best possible contractual rates

                    – Protect and extend key stock and exclusive products



                    Initially targeting savings of £60-80m p.a.

Page 128
Initially targeting a £60-80m accommodation cost saving

   Cost of providing tourism services           Group Destination management remit
   FY09 £m                        3,124
                                                • Top 75 hotel partners - £760m p.a.
                                  Top 75
                               hotel partners   • Turkey and Egypt hotels - £370m p.a.

                                 Turkey &       • Like-for-like savings of 5-7% targeted
                                  Egypt
                                                • £60-80m savings, assuming constant currency



                                Segment-
                              specific hotels




                        FY09 Accommodation costs


Page 129
New organisation created
                                                          CEO Group
                                                          Destination
                                                          Management

                     Overseas         Group Agency &      Group Content   Group Hotel   Group Head
                  Customer Service    Hotel Investments   Management      Contracting   of Health &
                  & Sales Directors       Director           Director      Directors       Safety


UK & Ireland

Central Europe

West/ East

North America

Northern Europe



                      Group team working closely with local markets

Page 130
In summary

   • A significant change to the way we do business

   • Group hotel purchasing organisation for biggest hotel chains and strategic destinations

   • Customer service organisation under a single management structure

   • Single agent per gateway in major destinations

   • Single content management system and process

   • Group destination management working closely with the segments


           Leveraging our position through a world class approach


Page 131
           Drive significant top line and bottom
              line growth in the UK & Ireland

           Ian Derbyshire – CEO UK & Ireland




Page 132
UK & Ireland objectives


           • Significantly grow top line & target industry leading margins


           • Continue mainstream product focus & margin improvement


           • Significantly grow independent travel online and offline


           • Continue to build financial services business




Page 133
We have significantly grown margins since 2007

   Revenue in £m                                      EBIT p.e in £m                   EBIT margin in %

                   -1%                                               +119%                     +117%

   3,132           3,097          3,098                                         162                       5.2%
                                                                         143
                                                                                                4.6%


                                                         74
                                                                                       2.4%




    FY07           FY08            FY09                 FY07            FY08    FY09    FY07    FY08      FY09



   Note: UK & Ireland results. These include India and Egypt in FY08 and FY09

Page 134
Five main drivers of UK & Ireland future growth


           1   Maximise mainstream margin

           2   Independent travel growth

           3   Financial services development

           4   Continued focus on cost reduction

           5   Investment in our people




Page 135
1    Maximise mainstream margin

    Main drivers of mainstream margin growth



           • Continuing the strategy we started in 2007, improving product mix

           • Growth of differentiated and exclusive product

           • Protect and grow strategic destinations

           • Automated yield management

           • Leverage our vertically integrated model



Page 136
1    Product mix

                                               Margin growth relative
           Increase of:   S07   S10   Target
                                                 to overall margin

       Thomas Cook
                          25%   36%   40%           ~£30/pax
      vs other brands

      Medium haul
                          58%   73%   80%           ~£15/pax
    vs short/long haul

    Other board types
                          61%   75%   85%           ~£12/pax
     vs self catering

           4/5* ratings   37%   46%   55%           ~£30/pax




Page 137
1     Product differentiation

                                                                        Margin growth relative
           Increase of:          S07             S10           Target
                                                                          to overall margin

      Differentiated
                                 35%             40%           65%           ~£30/pax
    and exclusive stock


    Starting point in 2007:


    • Inherited unattractive exclusive stock


    • Historically a high percentage of self catering units


    • Mostly third line stock (i.e. not beach front product)




Page 138
1     Differentiated stock

                                                     Margin growth relative
           For Summer 10            S10 Sales
                                                       to overall margin

                                       +87%                ~£30/pax

                                       +17%                ~£35/pax

        Exclusive product, eg
                                       +51%                ~£50/pax
    LykiaWorld, Marmaris Palace



            New for next year:

                                  growth in         and


                                  and increase in    resorts



Page 139
1     Higher margin segments
    Thomas Cook – beach air package market share 42%¹

                              Segment                     Price Band      Current Share

                                 Value                     £299 - £598     Share 44%

                                 Affordable                £599 - £898     Share 40%

                                 Premium                  £899 - £1,198    Share 35%

                                 Family Market                  Overall    Share 34%

                                 Adult Market                   Overall    Share 45%




    Source: ¹ LTM, based on Beach Air Packages Dec 2009

Page 140
 1     Protect and grow key destinations
                                                                                                 TCG     TCG
                                                Market Trend S09 vs S08              Pax 000’s   Trend   Share

Total Balearic Islands                                          -13%                     1,283   -17%    33%

            Total Greece                                     -16%                     1,210       -3%    37%

             Total Turkey                              +11%                    949               +25%    50%

Total Canary Islands                             -21%                    682                     -21%    52%

Total Mainland Spain                          -17%               581                             -26%    34%

             Total Cyprus                -15%             441                                     -4%    36%

              Total Egypt              +34%          357                                         +53%    39%

       Total Caribbean                 -14%      275                                              -5%    47%

            Total Portugal        -28%         221                                               -32%    36%

             Total Tunisia       +21% 152                                                        +34%    60%

        Key medium term destinations          Other major destinations
     Source: LTM, based on Beach Air Packages

 Page 141
1    Automated yield management

    • Holiday combinations (~ 7m) analysed overnight for demand forecast and optimal price


    • Where rate of sale is too low prices are lowered automatically


    • Prices are also maximised where strong demand exists


    • Automation of price changes directly in reservation system


    • Frees up Yield team for more strategic interventions and value adding activities




Page 142
1    Leverage vertical integration


                  Board Basis         S07          S10         Target

           In-house distribution     65%          77%          85%


           Retail productivity     £38k / FTE   £42k / FTE   £50k / FTE


           In-house flying           ~75%         ~90%        85-90%




Page 143
2    Independent travel platform - Wholesale

                   • Number 1 B2B bed bank in the UK
B2B bed banks
                   • Significantly grow B2C through OTA




   Scheduled       • A leading scheduled flight consolidator
     flight
  consolidator     • Continue to grow volumes and offering




           Brands and products in place to drive significant growth



Page 144
2    Independent travel platform – B2C

                  • Strengthened portfolio with Gold Medal acquisition
    Scheduled
                  • Growth into new product areas
    packages
                  • Elegant Resorts acquisition - # 1 luxury long haul TO


                  • Leading provider of sports-related product

     Specialist   • Exclusive Olympics 2012 sponsorship
    businesses    • We are the largest TO in teaching people to sail
                  • Market leader in activity beach clubs


           Brands and products in place to drive significant growth



Page 145
2    Independent travel passenger growth


                   Board Basis           Target
              No 1 Long Haul Tour
                                         +100%
            Operator Package & Flights

               Dynamic Packaging         +250%


                 Specialist Sales        +50%




            UK&I independent EBIT Margin target of 7 – 10%



Page 146
3     Financial services development – based on Forex

                                                              2009    2010       Target

           Retail FX market share                       11 – 12%     13 – 14%   15 – 16%

           Airport FX locations                                2        2          5

           ATMs                                                0       25         100

           CFX¹ customers                                     300      600       1,000

           Credit cards                                       160k    200k       350k




    Note: ¹ Corporate foreign exchange
    Source: Thomas Cook Financials and management estimates
Page 147
3     Financial services development – Insurance

                                       2009              2010                Target

           Insurance passengers        900k             1,100k               2,250k


    Acquisition of Essential Travel supports our strategy:

    • Delivers an industry leading direct sell platform for UK and beyond

    • Reengineered supply of travel insurance to in-house underwriter

    • Supports aggressive expansion into travel related ancillary services


                        Adds significant value to the UK business


Page 148
4     Continued focus on cost reduction

    UK cost of providing tourism services                           UK overhead costs
    FY09 £2,193m                                                    FY09 £762m


                    4%
        15%                                     Accommodation
                                41%             Aviation exc fuel                            Staff
                                                                     47%         53%
                                                Fuel                                         Other
           39%                                  Other



              • Group Destination Management – driving bed cost savings
              • Airline Synergies – cost efficiencies from Group-wide airline coordination
              • Procurement – savings from Group negotiated contracts
              • Project GLOBE – IT & systems efficiencies
    Note: All costs are pre-exceptional items
Page 149
5    Investing in our people is core to everything we do


    • ECHO Survey – driving employee engagement levels to 3.86 “Excellent” range


    •                        – range of e-learning and training programmes


    • Inspire and Sustain   – senior management development programme


    • Thomas Cook Vision – rolled out across the UK&I to 17,000 employees




Page 150
In summary

   • We will continue to drive benefits from original mainstream strategy set in 2007


   • We will increase margin performance by securing differentiated & exclusive product


   • Significant volume growth will continue in independent travel


   • Redefining of our financial services proposition will drive growth




                         Create the UK’s leading travel business




Page 151
           Significantly grow online and establish a
                   European OTA business

           Simon Breakwell – Ecommerce Advisor




Page 152
European OTA objectives



           • Thomas Cook online to become a top 3 European OTA


           • Targeting £3-3.5b incremental gross sales


           • Significant profit to come from OTA growth




Page 153
Four main types of player in the online travel market

            Online Travel                 • Online sale of third party components and ePackages¹
           Agents (OTAs)                  • Expedia/ Priceline European market leaders

                                          • Online sale of in-house product as part of multi-channel offer
       Tour Operators
                                          • Mainly a European dynamic with TCG/ TUI as market leaders


                                          • Suppliers of travel components such as airlines, hotels, car hire etc.
       Suppliers Direct
                                          • Major channel for airlines, hotels still reliant on agents


                                          • Act as middleman, mainly B2B although some B2C brands
            Wholesalers
                                          • Bed banks, flight consolidators, etc.

                           Lines beginning to blur between different players
   Note: ¹ Packages created online by the user from various travel components (e.g. Flight + hotel + car hire bundle)
   OTAs also starting to sell traditional mainstream packages
Page 154
Thomas Cook’s historical focus has not been on OTA

            Online Travel                     • Limited activities in the past
              Agents
           Agents (OTAs)                      • Some third party sales on thomascook.com (UK), and .de (Germany)



       Tour Operators

                                              • 80+ transactional websites with mainly a local market focus
                                              • Distributing in-house Tour Operator product and components¹
       Suppliers Direct
                                              • Today over 20% of total sales online (up to 60% in certain markets)
                                              • Also a leading wholesale capability (bed bank & flight consolidator)

            Wholesalers



           Thomas Cook online focus

   Note: ¹ Such as seat-only product sold by Thomas Cook airlines and hotel rooms from controlled concept hotels such as Sentido

Page 155
Strategy going forwards

            Online Travel       • Expand into European OTA market with Thomas Cook branded sites
           Agents (OTAs)        • Retail sites selling in-house product & acting as agent for third parties



       Tour Operators
                                • Maintain online growth and channel shift of TO and Direct product
                                • Local sites for major brands (Ving, Neckermann, Airtours, Condor etc.)
       Suppliers Direct


                                • Build & strengthen wholesale capability
            Wholesalers
                                • Third party agent platforms, bed bank and flight consolidator


                            Major focus is European OTA market entry

Page 156
Thomas Cook can create a unique market position



    One
    customer view

    One
    proposition

    All
    travel needs



Page 157
The OTA market is a major opportunity for Thomas Cook

           1•   European OTA market is large and growing fast

           2•   Barriers to entry are still relatively low

           3•   OTA model offers a route into new source markets

           4•   Significant online platform to build from

           5•   Leverages existing Thomas Cook capabilities

           6•   Thomas Cook can create a unique market position

            Targeting £3-3.5b of incremental gross sales in medium term

Page 158
1     European OTA market large and growing fast
    European online travel market gross sales in €b¹                                                                        CAGR
                                                                                                                           (06-11)
                                                                                                          79                 10%
                                                                                          73
                                                      68                68
                                                                                                          28.3   OTA²       14%
                                   60                                                    25.9
                                                    21.8               23.1
                 48               18.6
                                                                                                          8.0    TO         9%
                                                     6.7                6.8               7.3
                14.7
                                   6.1
                 5.1

                                                     39.1                                40.1             43.1   Direct³    9%
                                  35.2                                 38.1
                28.7



                2006              2007              2008              2009               2010             2011
    Note:     ¹ Wholesale market excluded to avoid double counting of totals
              ² Tour Operators excluded from OTA market, but are not estimated to comprise a large part
              3 Direct suppliers include Rail, Car, Air & Hotels etc.

    Source:   PhoCusWright European Online Travel market 5th Edition
Page 159
2     Less consolidated than the US – fewer barriers to entry

    OTA market gross sales (2008)¹                                              European market dynamics versus US

                                                                                • More local/ national brands
        100% ($36B)                           100% (€22B)
                                                                                • Online channel in earlier growth phase
                                                   Others
              Orbitz
                                                                                • Relatively fragmented market

           Travelocity                            Orbitz                        • City destinations important
                                                  Opodo
            Priceline                           Travelocity                     • Sun destinations also key: dominated by TOs
                                                 Priceline
             Expedia                                                            • Multi-channel important to customers
                                                  Expedia


                US                                Europe
                           Top 4 players
    Note: ¹ Third party sales on Tour Operator websites excluded from OTA market, but are not estimated to comprise a large portion
    Source: PhoCusWright European Online Travel Market 5th Edition and US Online Travel Market 9th Edition

Page 160
3     OTA model offers a route into new source markets

    European OTA market gross sales in €b, 2008
                                                                                         New source markets
                                                                                         Size of markets

                                                                             1.3         Scandinavia




                 UK                               4.8


                                                                     4.3                 Germany

           France                                       5.1                        3.0   Rest of Europe

                                                                       0.9               Italy
             Spain                              2.3



    Source: PhoCusWright European Online Travel Market 5th Edition

Page 161
4     Thomas Cook has a significant platform to build from

    UK total monthly unique users – Thomas Cook vs. top OTAs
    (in million; January 2010)


                                      Expedia¹                                                                                         3.6

               Lastminute (Travelocity)                                                                                2.7

                        Thomascook.com                                                                              2.6

               Booking.com (Priceline)                                                                              2.6

                                         Opodo                              0.9

                         Ebookers (Orbitz)                         0.5



    Note:     ¹ Unique visitors to Expedia.co.uk and .com, excludes non-Expedia branded sites such as Trip Advisor, Hotels.com, etc.
    Source:   ComScore Media Metrix January 2010

Page 162
5    We have many of the capabilities required to succeed
                European OTA Key success factors – Thomas Cook situation

     Brand      • Thomas Cook in all markets; one of world’s most trusted travel brands


      Scale     • 22m passengers out of 21 source markets


 Distribution   • Multi-channel: Stores & call centres to support online offer


     People     • Considerable in-house expertise, enhanced with external hires


    Inventory   • Market leading “sun” inventory, need to build up “city hotels”          a
                                                                                               Building
                                                                                              capability
 Technology     • Existing online platforms; some investment required                     b




Page 163
5    Building up inventory and technology capabilities

a   Building up city hotel inventory                    b    OTA technology platform investment


    • In the short term we’ve partnered with Expedia        • Enhance presentation layer (site look & feel)

      – Gives immediate access to 80k+ city hotels          • Streamline booking path (search & select)

    • In parallel building our own inventory                • Upgrade core infrastructure

      – Setting up city hotel purchasing organisation        – Hotel procurement platform

                                                             – Content management systems

                                                            • Investment levels no more than £20m p.a.



                                Continuous improvement activities

Page 164
6    Thomas Cook can create a unique market position

    Thomas Cook unique OTA proposition   Thomas Cook online objectives


                                         Top 3
                                         market position

                                         £3 – 3.5b
                                         gross sales

                                         £400 – 450m
                                         revenues
    One customer view
                                         Margins on a par with
    One proposition                      market leaders
    All travel needs
Page 165
Thomas Cook online implementation plan

           2009                     2010                    2011                      2012               2013

     New organisation

       Bridge solution

                  UK site refresh

                                Major upgrade of UK platform

                                        Planning for European roll-out                European rollout

                                                                                 New market entry strategy

                                                 Building up inventory (city hotel focus)

                                     Continuous improvement of customer experience and technology

                           March 2010


Page 166
In summary


    • OTA market offers a major growth and margin opportunity


    • Thomas Cook can build a unique position in this market


    • In the medium term we are targeting a top 3 position and over £400m revenues


    • Entry will primarily leverage existing assets and capabilities


    • Work is well underway, with thomascook.com¹ UK sales already up 30% YoY




    Note: ¹Independent product sales

Page 167
Summary and wrap-up
Manny Fontenla-Novoa, Group CEO
Thomas Cook in summary

 • One of the world’s leading travel and leisure companies

 • Highly talented and experienced management team

 • Strong market positions and great brands in all major source markets

 • Track record of delivering against strategy

 • Ability to successfully complete and integrate acquisitions

 • Market leading margins and clear path for continued top & bottom line growth




Page 169
           We have the strategy, structure, people,
               brands, scale and ambition to
            significantly grow top and bottom lines




Page 170
           Thank you




Page 171
Q&A
Notes




Page 173
Notes




Page 174
Notes




Page 175
Notes




Page 176
           Appendix
           – General segment information

           – Strategic initiatives detail

           – Other supporting information




Page 177
           General segment information




Page 178
Group financials
Revenue - £m
        (£m)                                                   EBIT (£m) and margin (%)                                  EPS*and DPS (p)
                                                                                                                         • progressive dividend policy
                                                                                                                         • payout 40-50% EPS*
                                                        +9%                                                                                                26.4
                                              9,269                                                    4.5                                       24.1
                                                        CAGR                        4.2
                         8,754                                      3.1                                           +30%          17.1
                                                                                                       415        CAGR
                                                                                    366
      7,879
                                                                    244                                                                                    10.75
                                                                                                                                                 9.75


      FY 07              FY 08                FY 09               FY 07            FY 08             FY 09                     FY 07             FY 08     FY 09


                                                                                                                         * pre-exceptional EPS




Operating cash flow** (£m)                                     Investments and buy back (£m)                             Net cash/(debt) (£m)
                                                                                                                         30 Sep 2007               394
                                                                    FY 07           FY 08              FY 09
                             294
          274                                                                                                            30 Sep 2008               (292)
                                                 205
                                                                        50
                                                                             0                                           30 Sep 2009               (675)
                                                                 (56)                                  (69)(47)
                                                                                 (141)             (186)
                                                                                       (248)
                                                                                    (296)
         FY 07              FY 08               FY 09
                                                                Net capex                 Net acquisitions/disposals
                                                                Share buy back

** Definition: cash generated by operations
Page 179
Segment financials
  Segment                               Revenue                   % Revenue                          EBIT                     EBIT         % EBIT **
                                                                                                                              margin
  UK and Ireland,                       £3,098m                                                      £162m                    5.2%
  India and Middle East
                                        2008: £3,097m                               33.4%            2008: £143m              2008: 4.6%               36.8%


  Continental Europe                    £4,000m                                                      £127m                    3.2%
                                        2008: £3,620m                               43.2%            2008: £106m              2008: 2.9%               28.8%


  Northern Europe                       £1,059m                                                      £86m                     8.2%
                                        2008: £972m                                                  2008: £86m               2008: 8.9%
                                                                                    11.4%                                                              19.6%

  North America                         £370m                                                        £18m                     4.8%
                                        2008: £384m                                   4.0%           2008: £6m                2008: 1.6%                4.1%


  Airlines Germany                      £1,061m                                                      £47m                     4.5%
                                                                                               *
                                        2008: £978m                                   8.0%           2008: £45m               2008: 4.6%               10.7%


* The percentage of Group revenue for Airlines Germany has been calculated using the external revenue figure of £741m.
** The contribution to Group has been based on the profit from operations figure of £441m, which excludes corporate costs of £26m.

Page 180
Thomas Cook UK
           Highly integrated and higher margin business             Drivers of margin performance
           Distribution                                     • Strong retail, travel and foreign exchange brand
           Controlled distribution:          ~80%
                                                            • Flexibility in capacity and destination
           Retail outlets:                   796
                                                            • Focus on higher margin products:
           In-house flying                                    − Medium haul, 4* & 5* and all inclusive
           Thomas Cook airline               c.92%
                                                              − Exclusive and differentiated
           Aircraft:
                   summer                    33 NB, 11 WB     − Focus on destination castles
                   winter                    27 NB, 10 WB   • Yield management improvements

           Accommodation                                    • Growing strong independent Travel proposition
           Exclusive & differentiated        c.40%          • Strengthening financial services position

                           Destination castles                  Product mix – focus on higher margin
     Turkey                  No.1            50% share       Capacity (%)             FY09                FY08
     Egypt                   No.2            39% share       Medium haul              72%                 65%

     Tunisia                 No.2            60% share       4* and 5*                45%                 41%
                                                             All inclusive            41%                 31%




   Note: NB – narrow body; WB – wide body

Page 181
Thomas Cook Northern Europe
       Highly integrated and highest margin business               Drivers of margin performance
           Distribution                                   • Leading market position and No.1 brands
           Controlled distribution:          84%          • Stable, rational market
           Internet distribution             54%
                                                          • Volume concentrated to destinations where most
           Retail outlets:                   11
                                                            Nordic customers travel
           In-house flying
                                                          • Unique concept hotels (40% higher margin)
           Thomas Cook airline               c.85%
           Aircraft:                                      • Growth of online bookings (FY09: 54%, FY08 46%)
                   summer                    8 NB, 3 WB   • Controlled distribution (FY09: 83%, FY08: 79%)
                   winter                    8 NB, 4 WB
                                                          • On board tax free sales
           Accommodation
                                                          • Most cost efficient aircraft
           Concept hotels                    25%
           Exclusive hotels                  90%

                           Destination castles                 Product mix – focus on higher margin
     Majorca                          No.1   50% share      Capacity (%)              FY09      FY08
     Gran Canaria                     No.1   45% share      4* and 5*¹                49%       48%
     Tenerife                         No.1   40% share
                                                            Of which                  27%       26%
     Rhodes                           No.1   35% share      Concept hotels
     Antalya                          No.1   25% share




  Note:¹Based on hotel utilisation
Page 182
Thomas Cook Central Continental Europe
                         Asset light business                           Drivers of margin performance
           Distribution                                         • Strong brand awareness - Neckermann
           Controlled distribution:    27%                      • Improving retail positioning
           Internet distribution:      7%
           Retail outlets:             1254                     • Dynamic packaging
                                       (1054 franchise)         • Flexibility in capacity and destination
           Transport                                            • Focus on differentiated product:
           Condor                      43% of flight holidays
                                                                  – Links to 300 concept hotels
           Car                         33% of holidays
                                                                  – Strategic partnerships (Sentido, Iberostar)
           Accommodation
           Exclusive hotels            24%                      • Consolidation opportunities



                    Outbound destination castles                    Product mix – focus on higher margin
     Balearics              No.1      32% share (S10)           Total Capacity (%)        FY09              FY08
     Canaries               No.2      24% share (S10)           4* and 5*                 64%               64%
     Turkey                 No.2      13% share (S10)
                                                                All inclusive             32%               32%
     Egypt                  No.2      14% share (W09/10)
                                                                Exclusive hotels          24%               25%




Page 183
Thomas Cook West/ East Continental Europe
              Partially integrated, diverse businesses                    Drivers of margin performance
           Distribution                                           • Brand strength in all markets
           Controlled distribution:      51%                      • Flexibility in capacity and destination
           Internet distribution:        13%
           Retail outlets:               1,102                    • Focus on higher margin products:
                                         (528 franchise)            – Differentiated hotels
           In-house flying                                          – Increasing exclusive content
           Belgium only                  58% of flight holidays   • Belgium – benefit of high vertical integration
           Aircraft:                     6 NB
           Car                           42% of holidays          • France – transformative acquisition (Jet Tours)

           Accommodation
           Differentiated & Exclusive hotels 42%

                    Outbound destination castles                      Product mix – focus on higher margin
                      Belgium         France       Netherlands    Capacity (%)               FY09             FY08
       Antalya           29%           14%                 15%    4* and 5*                   64%             63%
       Djerba            40%           23%                 21%
                                                                  All inclusive               36%             34%
       Monastir          30%           23%                 19%
       Crete             42%           13%                 20%




Page 184
Thomas Cook North America
     Mainstream - partially integrated              Drivers of margin performance
     Distribution                                   • Year round profitable volume
     Controlled distribution:                14%    • Product differentiation (hotel exclusivity)
     Internet distribution:                  38%
     Retail outlets:                         52     • Group buying power

     In-house flying                                • Continual aircraft utilization improvements
     Thomas Cook airline                     49%    • Service excellence and cost leadership
     Aircraft:
                                                    • Responsible capacity growth
            winter                           8 WB
            summer                           -      • Strong brands, including TC brand (Jan 2011)
     Accommodation                                  • Independent strength, less reliant on mainstream
     Differentiated and exclusive hotels     70%

     Mainstream destination trends (% of volume)    Independent destination trends (% of volume)
     Mexico                          - 40%          • USA - 70%
     Dominican Republic              - 21%          • Europe - 10%
     Cuba                            - 25%          • Sun destinations - 13%




   Note: NB – narrow body; WB – wide body

Page 185
Thomas Cook Airlines Germany
               Condor business model                                Operating statistics
     • Strong, profitable stand alone airline         • Sold Seats FY09:                5.9m
     • Arms length transactions with German TO        • Aircraft:                       25 narrow-body
     • Balanced seat sales allow optimum yields
     • Low cost base, ongoing efficiency programmes                                     9 wide-body
       (airline synergies)                            • Airport bases:                  10
     • Concentrated airport hubs (reduced from
                                                      • Average load factor FY09:       87.1%
       22 to 10)
     • No. 1 leisure carrier in Frankfurt             • Daily block hours/aircraft FY09: 10.8
     • Peak airport slots                             • Summer season weekly flights: >350
                                                      • S10 destinations:               28 continental
            Sales split by Sold sales (%)                                               29 intercontinental
                                                      • Most frequented destinations:   Palma de Mallorca
                                                                                        (80 flights per week)
                                    35%
              59%
                                    33%                                                 Antalya
              21%                                                                       (60 flights per week)
              20%                   32%

              FY04                    FY09
           Seat only   3P tour operator TC TO



Page 186
           Strategic initiatives detail




Page 187
Mainstream travel strategic initiatives

                    Cost efficiencies      ASPs and trading margin                 Distribution

Opportunities: • Bed costs                • Average price increases        • Third party commissions
               • Agency and reps spend    • Higher margin products         • Control of distribution
               • Hotel participations        – 4/5* and All Inclusive          – Pricing
               • Airline and fuel costs      – Longer haul lengths             – Merchandising

               • IT systems costs            – Exclusive/ differentiated   • Channel shift to online
               • Other purchasing         • UK a key opportunity           • UK a key opportunity

Initiatives:   • Destination management   • Net trading margin             • Control of distribution
               • Airline synergies           – Product mix                 • Channel shift
               • GLOBE and other IT          – Haul mix                        – New direct TO sites
               • Centralised purchasing   • Buying/ pricing processes          – Online investments
                                             – Yield management



 Page 188
Independent travel strategic initiatives

                 European OTA market         Wholesale growth        Scheduled package growth

Opportunities: • New market for TCG     • Sales to third parties     • New product lines
                  – Fast growth         • Reduce spend on third      • New destinations
                  – Unconsolidated        party wholesalers          • Offline and online
               • Entry to new markets                                • UK a key opportunity
                  – E.g. Italy, Spain


Initiatives:   • European OTA launch    • Wholesale platforms        • Scheduled product growth
                                            – Bed banks                  – Product development
                                            – Flight consolidators       – Merchandising
                                            – Agent platforms




 Page 189
Financial services strategic initiatives

                Foreign exchange growth     New product launches          Cross sell rates

Opportunities: • New airports             • Money transfer           • Insurance
               • New geographies          • In-resort ATMs           • Other products
               • Market share gain        • Pre-paid products
               • Greater cross-sell       • Dynamic Currency
                                            Conversion
                                          • Direct Insurance

Initiatives:   • FX growth                • FS innovation pipeline   • Cross-sell drive
                                                                         – Best practice sharing
                                                                         – Sales force training
                                                                     • Global insurance sourcing




 Page 190
M&A and partnerships strategic initiatives

                             New acquisitions                 Disposal of non-core assets

Opportunities: • Consolidation/ synergies                     • Hotel assets
                     • High growth markets                    • Non-core businesses
                     • High margin businesses




Initiatives:         • Consolidation (Germany)                • Disposals programme
                     • Emerging markets/ BRIC
                     • Direct insurance




    Note: ¹ Revenue and cost synergies, primarily in the UK

 Page 191
           Other supporting information




Page 192
Thomas Cook Group Executive Board

                                                 Group CEO
                                             Manny Fontenla-Novoa¹


                    Segment Heads                                             Functional Heads

  Deputy Group CEO
                               CEO North America                  Group CFO             Group Strategy Director
 CEO Northern Europe
                                Michael Friisdahl               Paul Hollingworth¹           Jürgen Büser
   Sam Weihagen¹


    CEO UK & Ireland           CEO Central Europe            CEO Group Operations         Group HR Director
     Ian Derbyshire             Peter Fankhauser                Ludger Heuberg                Paul Wood


                                                             CEO Group Destination
     CEO West/ East           CEO Airlines Germany                                     Group Company Secretary
                                                                 Management
     Thomas Döring               Ralf Teckentrup                                           Derek Woodward
                                                                 Pete Constanti


                                                              Ecommerce Advisor
                                                                Simon Breakwell


   Note: ¹ PLC Board Member

Page 193
The Thomas Cook management team (1 of 4)




                        Manny Fontenla Novoa                     Sam Weihagen                          Paul Hollingworth
                        Group CEO                                Deputy Group CEO                      Group CFO
                                                                 CEO Northern Europe
Experience in      •   38 years                              •   34 years                          •   16 years (company FD)
travel industry:
Thomas Cook        •   Group CEO since 2007                  •   Deputy Group CEO since Nov 2009   •   Group CFO since Jan 2010
roles:
                   •   Group CEO Thomas Cook AG since 2005   •   CEO Northern Europe since 2001
                   •   Previous roles include:
                          –   CEO Thomas Cook UK & Ireland

Other roles:       •   Co-founder of Sunworld                •   CEO MyTravel Northern Europe      •   CFO Mondi Group
                                                                                                   •   Group Finance Director of BPB plc
                                                                                                   •   Group Finance Director of De La Rue plc
                                                                                                   •   Group Finance Director Ransomes plc




 Page 194
The Thomas Cook management team (2 of 4)




                          Michael Friisdahl                         Ralf Teckentrup                                   Ian Derbyshire
                          CEO North America                         CEO Airlines Germany                              CEO UK & Ireland

Experience in travel •   26 years                                   •   23 years                                  •   26 years
industry:
Thomas Cook          •   CEO North America since 2005               •   CEO Condor since 2004                     •   CEO UK & I since Nov 2009
roles:
                                                                    •   Board Member Thomas Cook AG               •   Previous roles include:
                                                                    •   Previous roles include:                          –   CEO UK&I Independent Travel

                                                                           –   Group IT Management                       –   Director of Sales

                                                                           –   Group Purchasing

Other roles:         •   President MyTravel N. Am. in 2000          •   A number of senior roles at Lufthansa     •   Previous roles at:
                                                                        including Senior Vice President Network          –   Holiday Autos
                     •   Partner and CEO of The Holiday Network -
                                                                        Management, IT and Purchasing
                         acquired by Airtours in 2000                                                                    –   Rank Group
                                                                                                                         –   Co-Op travel




 Page 195
The Thomas Cook management team (3 of 4)




               Dr Thomas Döring                   Dr Peter Fankhauser                       Pete Constanti                     Ludger Heuberg
               CEO W/E Europe                     CEO Central Europe                        CEO Group Destination              CEO Group Operations
                                                                                            Management
Experience in •    9 years                          •   21 years                            •   28 years                       •   8 years
travel industry:
Thomas Cook •      CEO West/ East since 2006        •   CEO Central Europe since 2006 •         CEO Destination Management     •   CEO Group Ops since 2008
roles:                                                                                          since Nov 2009
            •      Previous roles include:          •   Chairman Thomas Cook AG                                                •   Board member TC AG
                      –   Corporate Development
                                                                                            •   Previous roles include:
                                                    •   Previous roles include:                                                •   Previous roles include:
                      –   M&A                                                                      –   CEO, Mainstream, UK&I
                                                           –   Chief Product Officer role                                             –   Group CFO

Other roles:   •   Partner, Roland Berger           •   Executive Board Member of           •   HR Director Sunworld           •   CFO of Lufthansa Cargo AG,
                                                        Kuoni Reisen Holding AG
                                                                                            •   HR Director ILG                •   CFO of Kolbenschmidt-Pierburg
                                                    •   CEO of LTU Group
                                                                                                                               •   Director of Mauser Waldeck AG




 Page 196
The Thomas Cook management team (4 of 4)




                   Simon Breakwell                      Dr Jürgen Büser                        Derek Woodward                               Paul Wood
                   Ecommerce Advisor                    Group Strategy Director                Group Company Secretary                      Group HR Director

Experience in      •   23 years                         •   7 years                            •   25 years (Company Secretary)         •    20 years (HR & reward)
travel industry:
Thomas Cook        •   Ecommerce advisor since 2009     •   Group Strategy Director since      •   Group Company Secretary since •           Group HR Director since 2009
roles:                                                      Nov 2009                               April 2008
                                                                                                                                 •           Previous roles include:
                                                        •   Previous roles include:                                                             –   Group Head of reward
                                                               –   Group CFO
                                                               –   CFO UK & Ireland
                                                               –   Head of Controlling & M&A

Other roles:       •   President Expedia Europe         •   Director Operations, Siemens       •   Assistant Company Secretary,         •    Group Head of reward MyTravel
                                                            Financial Services                     B.A.T Industries plc
                   •   EVP Sales & Marketing Expedia                                                                                    •    Reward Director at Clifford
                                                        •   Engagement Manager, Booz           •   Company Secretary, Allied                 Chance LLP
                   •   Group Business Manager
                                                            Allen & Hamilton                       Zurich plc
                       Microsoft Travel Business Unit
                                                                                               •   Head of Secretariat, Centrica plc,



 Page 197
Main acquisitions completed June 2007 – March 2010

                               Acquisitions¹                                      Country                                           Date

Mainstream            Neckermann Urlaubswelten                           Germany                                              May 08
Travel:
                      Jet Tours                                          France                                               Aug 08


Independent           Hotels4U.com                                       UK                                                   Feb 08
Travel                Elegant Resorts                                    UK                                                   Apr 08
                      TriWest                                            Canada                                               Aug 08
                      Med Hotels                                         UK                                                   Feb 09
                      Gold Medal                                         UK                                                   Apr 09


Emerging              Travel Plus                                        Czech                                                Aug 07
markets               TC Egypt                                           Egypt/ ME                                            Apr 08
                      TC India                                           India                                                Mar - Jul 08


   Note: ¹ Other acquisitions completed: Wasteels, Airtrack, neckermann.de, urlaub.de; 65% of Iberoservice acquired in 2008
   however not included as an acquisition
Page 198
Achievable Industry Margins
                                                                           Achievable      TCG
Pre exceptional EBIT margins %
                                                                        industry margins   FY 09
Fully integrated businesses                        Northern Europe             9            8.2
                                                       UK & Ireland                        5.2¹
Highly integrated businesses                                                   8
                                                           Belgium                         5.3
                                                             France                         5.0
Partially integrated businesses                                                6
                                                            Canada                          4.8
                                                        Netherlands                         2.9
Tour operator                                                                  3
                                                          Germany                           2.3
Airline                                                    Germany             6            4.5
                                                 TO & Airline Germany          5            3.3
                                                                                              2
                                                  Russia / E. Europe          4            3.3
Emerging markets                             India, Egypt & Lebanon           40           32.4
                                                               China          30           N/A


Note: 1 UK margin includes India and Egypt
Note: 2 Eastern Europe only
Page 199
General definitions
                             • The proportion of passengers booking through our in-house retail shops, call centres and websites.
• Controlled distribution
                               Calculated on departed passengers in the period
• ‘Differentiated’ product   • Product which justifies a margin premium; enabled through strategic partnerships
                             • Earnings before interest and tax, adjusted to exclude exceptional operating items and amortisation of
• EBIT (p.e.)                  business combination intangibles. It also excludes our share of the results of associates and joint
                               ventures
• EBIT margin                • EBIT (p.e.) as above divided by external sales unless otherwise stated
                             • Product only accessible through Thomas Cook; whether due to Thomas Cook Group ownership or
• ‘Exclusive’ product
                               franchise agreements
                             • A sub-set of controlled distribution, it is defined as the proportion of passengers booking through in-
• Internet distribution
                               house websites. Calculated on departed passengers in the period
                             • In the case of UK, Northern Europe and North America total passengers that departed on a Thomas
                               Cook Group holiday in the period and excludes customers who booked third party tour operator products
• Passengers                   through Thomas Cook retail channels and transfers only
                             • For Continental Europe it represents all tour operator passengers departed in the period, excluding those
                               on which only commission is earned
• FY07; FY08; FY09           • Financial figures shown relate to pro forma 12 months to September
                              • Includes leisure and unmanaged business travel (calculated as sum of Outbound accommodation tourist
                                expenditure, Air transportation expenditure and Domestic Leisure tourism expenditure)
• ‘Addressable’ travel market • Thomas Cook Group focus defined as expenditure through travel intermediaries
                              • Travel intermediaries split into ‘Mainstream’, ‘Independent’ and ‘Financial Services’
                              • All growth rates are real growth (no adjustment for inflation)



 Page 200
Travel definitions

                    Thomas Cook Group leisure and unmanaged business travel

                                                                                                                            Travel-related financial
           Mainstream travel                           +            Independent travel                            +
                                                                                                                                   services

 • Pre-packaged holiday                                    • Individual travel                                         • All travel-related financial
    consisting of two or more                                  components¹ either                                         services spend (money,
    components¹                                                purchased separately or                                    assurance, finance)
 • Customer is presented with                                  dynamically combined into                               • Includes the financial
    a single price                                             a package²                                                 services component of any
 • Primarily charter Tour                                  • Customers are presented                                      package (e.g. add on travel
    Operator packages which                                    with a price for each                                      and cancellation insurance)
    include the services of a                                  component
    rep in-destination



   Note: ¹ Components include flight, hotel, car hire, rail, boat charter, tour, excursion, ticket for attraction, service of a guide etc.
         ² Either by the customer or with the help of an agent

Page 201