The holiday company lost millions of pounds in profits after our nice summer meant people didn’t bother going abroad.
What it means: Thomas Cook has issued a profit warning, which means it gave the stockmarket a heads up that it’s going to make less money this year than it was supposed to. The company made ‘just’ £280 million this year, rather than the £323 million it had predicted (we wish we had your problem, TC). Shareholders, who own a bit of Thomas Cook and are entitled to some of its profits, weren’t pleased. Lots of them decided to sell their shares which made the value of Thomas Cook drop by 25 percent. (The value is how much it’d cost you to buy the whole company outright).
Thomas Cook said the problem was the heatwave Britain had this summer. It seems us Brits decided there was little point schlepping all the way to Spain or Turkey when we could tan just as well in our own backyard. Unfortunately for Thomas Cook, if this is true they’re going to have some serious financial problems ahead, because many scientists think that European heatwaves will become more and more frequent.
The reason is climate change, so Thomas Cook’s problems are an example of the ways our (lack of) environmentalism may have more consequences than many people once realised. Lots of people think being green is a great idea for reasons that have nothing to do with money. But most businesses (and many economists) have for a long time prioritised economic growth over environmental sustainability. Thomas Cook’s money worries suggests that might not have been the best tactic.
At least us Brits are doing our part by staying home - planes are a big emitter of greenhouse gases, which cause climate change.
We’ve moved beyond a world where your country was all that matters. Our economies have become bigger than we realise. Things we use are less and less likely to come from our own country and more likely to have been imported from a country across the globe – this has become so normal that we’ve forgotten what a huge implication this has for how our economies work…