* Sells Gold Medal unit to dnata for 45 mln stg
* Meets disposal target ahead of schedule
* Q1 operating loss 56 mln stg vs 66 mln stg last year
* Finds additional cost savings
* Shares down 1.6 pct
(Adds CEO comments, analyst comment, share price)
By Sarah Young
LONDON, Feb 11 British holiday operator Thomas
Cook said a 45 million pound ($73.8 million) disposal
had helped it reach a sell-off target ahead of schedule, giving
it further confidence in its turnaround efforts.
Thomas Cook is half-way through a three-year plan to cut
jobs, close branches and sell businesses after the euro zone
debt crisis, high fuel costs and political turmoil in Egypt and
Tunisia brought the world's oldest travel firm to its knees in
Reporting a narrowing seasonal loss, the company said summer
bookings were developing in line with its expectations.
Bookings for summer holidays are watched closely as they
generate the bulk of the firm's earnings.
The agreed sale of Gold Medal, a distributor of scheduled
flights, hotels and car hire, to dnata, a unit of the Emirates
Group, for 45 million pounds, brings the proceeds of disposals
to 125 million pounds, the company said on Tuesday.
It had set a target to make between 100 and 150 million
pounds from divestments by the end of next year.
Thomas Cook, founded 173 years ago, reported an underlying
first-quarter operating loss of 56 million pounds in the three
months to the end of December, 15 percent less than a year
Cost savings offset the negative impact of Egypt, where
unrest has put customers off from holidaying there this winter.
The confident statement echoed the guidance of Thomas Cook's
larger rival TUI Travel, which last week also
reported a smaller quarterly loss and said it was seeing strong
demand for summer holidays.
"Given Thomas Cook's superior self-help opportunities and
growth prospects, we think Thomas Cook should trade on at least
the same multiples as TUI Travel," broker Jefferies said,
explaining that its 200 pence target price is based on Thomas
Cook trading on the same multiple as TUI Travel.
Thomas Cook trades for now at a ratio of 11 times estimated
2015 earnings, while TUI trades at 12.3 times, Jefferies said.
The company issued successive profit warnings in 2011,
sending its share price plunging as low as 8 pence and forcing
it to scrap its dividend to help cut debt.
In late 2011, it asked lenders twice to come to its rescue
as it struggled with its debt load amid tough trading conditions
during its seasonal low period.
Under the turnaround begun by Chief Executive Harriet Green,
who joined in July 2012, the stock has more than doubled over
the last year and is up over 30 percent in the last three
months. It traded down 1.6 percent at 182.5 pence at 1110 GMT.
"It's been a very good performer. The thing about these kind
of stocks is they tend to need upgrades to drive the price,"
Shore Capital analyst Greg Johnson said.
Green told reporters on a call that the company was seeing
customers returning to Egypt but not yet in the numbers seen
"We are delivering what we said we would deliver," she said,
adding that the company was confident of achieving all its
Thomas Cook announced plans last November to cut costs by
440 million pounds by 2015 and said on Tuesday it had also found
additional cost savings that it would detail in May.
($1 = 0.6098 British pounds)
(Editing by Kate Holton and Tom Pfeiffer)