MYT
Joined: Aug 2003
Posts: 131
Likes: 0
From: essex
Air Mail - I think you are along the right lines.
MYT has said it made no money over the summer and if the busineses it proposes to sell are not sold then it will run out of working capital. As you say, the banks are owed a lot of money and they will be keen to see a return so I think it will be some kind of debt/equity swap with the current shareholders the ones to lose out. Reminds me of a certain large Hotels group which has had similar problems and is effectively owned by RBS bank now.
MYT has said it made no money over the summer and if the busineses it proposes to sell are not sold then it will run out of working capital. As you say, the banks are owed a lot of money and they will be keen to see a return so I think it will be some kind of debt/equity swap with the current shareholders the ones to lose out. Reminds me of a certain large Hotels group which has had similar problems and is effectively owned by RBS bank now.
Joined: Nov 2002
Posts: 122
Likes: 0
From: MAN
From the Circular Regarding the EGM:
If any of the disposals Cruise Disposal, the Auto Europe Disposal or the WCT Disposal is not completed or the other assumptions set out above are not fulfilled, the Continuing MyTravel Group would require additional sources of working capital. The Board has identified further businesses and assets for disposal and will seek to negotiate and complete these disposals in case such additional working capital is required.
If additional working capital is required and such further disposals are not completed, or are completed but do not provide sufficient working capital, the Continuing MyTravel Group would require additional facilities in order to have sufficient working capital and would require consent from the Affected Lenders for that purpose.
The Continuing MyTravel Group may not be able to obtain such facilities and such consent may not be given. If these circumstances occur and the Continuing MyTravel Group is not able to obtain additional facilities, the Continuing MyTravel Group would not have sufficient working capital for its present requirements.
If additional working capital is required and such further disposals are not completed, or are completed but do not provide sufficient working capital, the Continuing MyTravel Group would require additional facilities in order to have sufficient working capital and would require consent from the Affected Lenders for that purpose.
The Continuing MyTravel Group may not be able to obtain such facilities and such consent may not be given. If these circumstances occur and the Continuing MyTravel Group is not able to obtain additional facilities, the Continuing MyTravel Group would not have sufficient working capital for its present requirements.
Joined: Feb 2003
Posts: 5
Likes: 0
From: Newcastle-upon-Tyne, UK
I hope My Travel does survive. If not, my dad is out of a senior management position in the retail chain and my mam will be out of an assistant manager role in one of the stores!!
Before I joined NATS, I worked at Going Places off and on over a period of 3 years and they are trying to streamline the business for the better. However, a big shop was built in the Northeast to relocate a previously significantly smaller unit into - the first store had 6 desks, the new one has nearly 20 desks - problem is, they no longer have any staff to fill them all anyway!!! Whenever I go to visit now I frequently only see 4-5 staff on maximum which is a great shame.
Going Places also tried to revolutionise the way people book holidays by piloting (excuse the pun) a scheme involving "Welcome Hosts" in the shops, this freed up agents to deal with holiday enquiries and means brochure requests got handled by somebody not trained in the Viewdata systems.
In all, to stop boring you - I am confident My Travel will survive, they've made some daft decisions which have helped cripple them but they will cling on then hopefully claw back. Because of our family links, we have flown Airtours/My Travel now for 10 years and unless they do fold I will continue to do so.
Chris
Before I joined NATS, I worked at Going Places off and on over a period of 3 years and they are trying to streamline the business for the better. However, a big shop was built in the Northeast to relocate a previously significantly smaller unit into - the first store had 6 desks, the new one has nearly 20 desks - problem is, they no longer have any staff to fill them all anyway!!! Whenever I go to visit now I frequently only see 4-5 staff on maximum which is a great shame.
Going Places also tried to revolutionise the way people book holidays by piloting (excuse the pun) a scheme involving "Welcome Hosts" in the shops, this freed up agents to deal with holiday enquiries and means brochure requests got handled by somebody not trained in the Viewdata systems.
In all, to stop boring you - I am confident My Travel will survive, they've made some daft decisions which have helped cripple them but they will cling on then hopefully claw back. Because of our family links, we have flown Airtours/My Travel now for 10 years and unless they do fold I will continue to do so.
Chris
Joined: Mar 2002
Posts: 34
Likes: 0
From: CWL
Cheers Chris,
You make a very valid point.
With all the restructuring, and re-assesing going on, If they make it out the oter side of the financial crisis they could wll be a very lean, and mean operation.
They are making some good and sensible (first in a while) decisions, that given the chance, will be setting examples.
They have been forced into this position by previous incompetents, I can see the silver lining; lets hope we all get to see it!!
You make a very valid point.
With all the restructuring, and re-assesing going on, If they make it out the oter side of the financial crisis they could wll be a very lean, and mean operation.
They are making some good and sensible (first in a while) decisions, that given the chance, will be setting examples.
They have been forced into this position by previous incompetents, I can see the silver lining; lets hope we all get to see it!!
Joined: Apr 1999
Posts: 238
Likes: 1
From: UK
From the TTG:
November 7th 2003 -02:08 PM
Summer losses at MyTravel have left the company with “insufficient” cash to survive winter, the group has admitted.
A company spokesman said: “It is now up to the banks to make a decision on whether there is still a viable entity coming out of this.”
In a profits warning, the company predicted it had made operating losses during the key summer months – the period operators rely on to make money.
It blamed the weak late-sales market and a new accounting procedure for its position, and admitted overcapacity and poor margins had left it exposed.
In the same six-month period last year, MyTravel made £130 million.
In a statement, the group admitted it had insufficient funds to get through the next 12 months, and conceded its future now depends on:
• Shareholder approval of the sale of US cruise, car hire and hotel booking businesses
• Bookings continuing at “satisfactory levels and acceptable margins”
• Agreement by the CAA not to suspend its bond
The group is understood to have written to overseas suppliers to ask for 90 days’ credit to see it past the January peak sales period. But hoteliers are said to be reluctant to comply.
The desperate situation emerged as MyTravel confirmed its latest fire sale, with US car hire business Auto Europe disposed of for £50 million.
In a statement, MyTravel chairman Eric Sanderson admitted: “The group’s earnings and cash flows will remain subject to significant risk through its high fixed-cost structure and high levels of indebtedness.”
Banks and regulators were informed of MyTravel’s predicament before the group issued the profits warning.
The CAA’s inaction suggests it believes MyTravel has a fighting chance.
But the next few weeks are crucial because traditionally fewer bookings are made.
The authority is always reluctant to intervene during the summer, when more customers are abroad. It also prefers to allow operators the chance to boost coffers during the peak.
However, MyTravel’s admission prompted calls for the CAA to step in now the summer is over.
Rivals are unhappy the group was allowed to continue trading this year, and blame it for fuelling overcapacity and lowering prices in the late sales period.
“Everyone complained to the CAA last time,” said an industry expert.
Another said: “The question now is ‘what is the CAA going to do?’.”
MyTravel insisted a revival was still possible.
A spokesman said: “If MyTravel gets the working capital to see it through the winter, then at that point we should start to see some impact of the turnaround.”
But he conceded an original timescale had slipped.
“In March, we said it would take two years before we start making significant progress in terms of climbing back towards the black, but it’s going to take a lot longer than that.”
MyTravel’s directors declined to speak to TTG.
November 7th 2003 -02:08 PM
Summer losses at MyTravel have left the company with “insufficient” cash to survive winter, the group has admitted.
A company spokesman said: “It is now up to the banks to make a decision on whether there is still a viable entity coming out of this.”
In a profits warning, the company predicted it had made operating losses during the key summer months – the period operators rely on to make money.
It blamed the weak late-sales market and a new accounting procedure for its position, and admitted overcapacity and poor margins had left it exposed.
In the same six-month period last year, MyTravel made £130 million.
In a statement, the group admitted it had insufficient funds to get through the next 12 months, and conceded its future now depends on:
• Shareholder approval of the sale of US cruise, car hire and hotel booking businesses
• Bookings continuing at “satisfactory levels and acceptable margins”
• Agreement by the CAA not to suspend its bond
The group is understood to have written to overseas suppliers to ask for 90 days’ credit to see it past the January peak sales period. But hoteliers are said to be reluctant to comply.
The desperate situation emerged as MyTravel confirmed its latest fire sale, with US car hire business Auto Europe disposed of for £50 million.
In a statement, MyTravel chairman Eric Sanderson admitted: “The group’s earnings and cash flows will remain subject to significant risk through its high fixed-cost structure and high levels of indebtedness.”
Banks and regulators were informed of MyTravel’s predicament before the group issued the profits warning.
The CAA’s inaction suggests it believes MyTravel has a fighting chance.
But the next few weeks are crucial because traditionally fewer bookings are made.
The authority is always reluctant to intervene during the summer, when more customers are abroad. It also prefers to allow operators the chance to boost coffers during the peak.
However, MyTravel’s admission prompted calls for the CAA to step in now the summer is over.
Rivals are unhappy the group was allowed to continue trading this year, and blame it for fuelling overcapacity and lowering prices in the late sales period.
“Everyone complained to the CAA last time,” said an industry expert.
Another said: “The question now is ‘what is the CAA going to do?’.”
MyTravel insisted a revival was still possible.
A spokesman said: “If MyTravel gets the working capital to see it through the winter, then at that point we should start to see some impact of the turnaround.”
But he conceded an original timescale had slipped.
“In March, we said it would take two years before we start making significant progress in terms of climbing back towards the black, but it’s going to take a lot longer than that.”
MyTravel’s directors declined to speak to TTG.
Joined: May 2002
Posts: 71
Likes: 0
From: East Midlands
Thomas Cook Airlines (TCX) unveils new Summer 2004 Canada flights
Thomas Cook Airlines are to enter the crowded UK-Canada market next summer and offer new charter services from London-Gatwick, Birmingham, Glasgow and Edinburgh to Toronto.
A one-class cabin will be used with greater seat pitch than the economy sections on scheduled airlines.
2x Boeing 757s with 187 leahter seats will be used for the services.
But there are concerns that there is too much overcapacity in the UK-Canada market and therefore could be a lot of consolidation next summer.
Source: Travel Trade Gazette - 10th November 2003.
A one-class cabin will be used with greater seat pitch than the economy sections on scheduled airlines.
2x Boeing 757s with 187 leahter seats will be used for the services.
But there are concerns that there is too much overcapacity in the UK-Canada market and therefore could be a lot of consolidation next summer.
Source: Travel Trade Gazette - 10th November 2003.
Joined: May 2002
Posts: 71
Likes: 0
From: East Midlands
My Travel cannot survive for another 12 months
In a starkling report in the Travel Trade Gazette (10th November), My Travel has said that if cannot agree another mult-million pound loan soon it will not be able to survive after November 2004 because they just have not generated sufficient cash from Summer 2003 bookings. The "Baghdad bounce" never materialised.
ATOL are strongly considering stripping them of their bond because the company is so debt-ridden.
My Travel are trying to sell of major parts of their business to raise any cash. There are rumours that Manos and Panorma may be sold.
Rival tour operators, TUI UK, Thomas Cook and First Choice are annoyed that they have been allowed to carry on trading. They believe that a turnaround is now unlikely, and sadly so do many critics.
MyTravel should be changed to MyDebt?...MyProblems?
ATOL are strongly considering stripping them of their bond because the company is so debt-ridden.
My Travel are trying to sell of major parts of their business to raise any cash. There are rumours that Manos and Panorma may be sold.
Rival tour operators, TUI UK, Thomas Cook and First Choice are annoyed that they have been allowed to carry on trading. They believe that a turnaround is now unlikely, and sadly so do many critics.
MyTravel should be changed to MyDebt?...MyProblems?
Joined: Oct 2002
Posts: 437
Likes: 0
From: somewhere near LTN
Thank you for posting pretty much verbatim (with the exception of your own unique spelling) the text from TTG.
Do you have any opinion on TCX going into the Canada market? I personally think that TTG were wrong in their statement that the market is already crowded. I think that the UK-Canada market could do with more competition.
cheers
FF
Do you have any opinion on TCX going into the Canada market? I personally think that TTG were wrong in their statement that the market is already crowded. I think that the UK-Canada market could do with more competition.
cheers
FF
Joined: Aug 2003
Posts: 42
Likes: 0
From: UK
The only thing no one seems to have considered here is MYTravel's notorious disregard for the punters. People I have heard saying things like "I'll never fly with them again and will certainly tell all my friends". This usually followed such things as:
"I paid extra money to fly from Humberside and now I find myself being bussed to Manchester and then bussed back from Manchester. No refund of my extra and no apology".
"I was bussed to Gatwick to go and then bussed from Birmingham when I got back"
Etc Etc Etc
Whilst undeniably some of the reasons are the downturn as quoted previously, perhaps a little closer examination of their own policies would bear looking into?
Hope they are gonna be alright otherwise a lot of good people will be out of work.
"I paid extra money to fly from Humberside and now I find myself being bussed to Manchester and then bussed back from Manchester. No refund of my extra and no apology".
"I was bussed to Gatwick to go and then bussed from Birmingham when I got back"
Etc Etc Etc
Whilst undeniably some of the reasons are the downturn as quoted previously, perhaps a little closer examination of their own policies would bear looking into?
Hope they are gonna be alright otherwise a lot of good people will be out of work.
Joined: Apr 2000
Posts: 257
Likes: 0
Civil servant
And of course this sort of thing only happens at MYT! I can relate stories about all of the other operators from friends and my own experience that would sound exactly like yours and worse! And most end up going on holiday with the same operators again! I have been on holiday with MYT a dozen or so times without a problem or delay! Of all the trips I have done for the company over the last eleven years only a very few have resulted in long delays or problems. Like all operators MYT upset passengers like yourself from time to time it is not good but it happens.
Of course the TTG would not be influenced by inputs from MYT's competitors!? That would be unthinkable; after all MYT’s competitors would have no vested interest in twisting the knife or exaggerating a few truths perhaps?
Things are not good but MYT can still generate cash, all be it by selling assets! If the banks pull the plug now they would find it more difficult to get a good price for the good bits of the group. Most of the group’s tour operator’s do well, the problem is the PLC. MYT probably have another year to show signs of recovery, so don’t count them out just yet. I doubt the CAA will pull the bond if the asset sales go through they would have no reason to just yet.
And of course this sort of thing only happens at MYT! I can relate stories about all of the other operators from friends and my own experience that would sound exactly like yours and worse! And most end up going on holiday with the same operators again! I have been on holiday with MYT a dozen or so times without a problem or delay! Of all the trips I have done for the company over the last eleven years only a very few have resulted in long delays or problems. Like all operators MYT upset passengers like yourself from time to time it is not good but it happens.
Of course the TTG would not be influenced by inputs from MYT's competitors!? That would be unthinkable; after all MYT’s competitors would have no vested interest in twisting the knife or exaggerating a few truths perhaps?
Things are not good but MYT can still generate cash, all be it by selling assets! If the banks pull the plug now they would find it more difficult to get a good price for the good bits of the group. Most of the group’s tour operator’s do well, the problem is the PLC. MYT probably have another year to show signs of recovery, so don’t count them out just yet. I doubt the CAA will pull the bond if the asset sales go through they would have no reason to just yet.
Alba Gu Brath
Joined: Oct 2000
Posts: 745
Likes: 3
From: Merseyside
kinsman,
Wasn't TTG once published by a certain Canadian publishing company that used to have a vested interest in the UK tour market?? Not that I'm questioning the integrity of the report in the TTG. Who me? Never guv, honesty's my middle name. Could have been a journalist.
Wasn't TTG once published by a certain Canadian publishing company that used to have a vested interest in the UK tour market?? Not that I'm questioning the integrity of the report in the TTG. Who me? Never guv, honesty's my middle name. Could have been a journalist.
Joined: Jun 2001
Posts: 1,650
Likes: 0
From: southern england
I think Kinsman has been dreaming of those "silver linings"!
On 3 November, MyTravel Group called an EGM, because it was in breach of section 142 of the Companies' Act 1985, which requires that the net value of the company's assets (net of liabilities) should exceed 50% of it's "called up" capital. This is no longer the case, and the EGM will be used as a vehicle to explain how the company plan to resolve this.
It does not make for comfortable reading that
These are not the words of TTG, Daily Mail, or any other paper.
If anyone can keep awake long enough, then they would do well to read completely the two messages from MyTravel about this EGM, and then decide for themselves whether MyTravel will last for another 12 months. notice of EGM supplemental circular
As a comparison, First Choice announced that it believed that it would make full year profit targets this year, despite the effects of the GWII. At the end of October it said the 2003 summer season had been one of its best ever, and described demand for winter bookings so far as "strong."BBC report(24/10/03)
On 3 November, MyTravel Group called an EGM, because it was in breach of section 142 of the Companies' Act 1985, which requires that the net value of the company's assets (net of liabilities) should exceed 50% of it's "called up" capital. This is no longer the case, and the EGM will be used as a vehicle to explain how the company plan to resolve this.
It does not make for comfortable reading that
The Continuing MyTravel Group does not currently have sufficient working capital
If anyone can keep awake long enough, then they would do well to read completely the two messages from MyTravel about this EGM, and then decide for themselves whether MyTravel will last for another 12 months. notice of EGM supplemental circular
As a comparison, First Choice announced that it believed that it would make full year profit targets this year, despite the effects of the GWII. At the end of October it said the 2003 summer season had been one of its best ever, and described demand for winter bookings so far as "strong."BBC report(24/10/03)
Joined: Mar 2003
Posts: 73
Likes: 0
From: Manchester UK
Have been in the industry long enough to have seen all of this before. A familiar pattern in the majority of cases.
Having read the 2 notices posted above, I note the remuneration of the board and non-executive directors.
Forgive me for being synical, but over half a million a year for the CEO, plus share options and product familiarisation allowance...
doesn't he do a great job.. worth every penny!!
Having read the 2 notices posted above, I note the remuneration of the board and non-executive directors.
Forgive me for being synical, but over half a million a year for the CEO, plus share options and product familiarisation allowance...
doesn't he do a great job.. worth every penny!!