David Coker, Senior Lecturer in Finance and Accounting, was quoted in an article by Sputnik International about the financial issues that travel giant Thomas Cook faced prior to their collapse.
David Coker argued that Thomas Cook’s problems started 10 years ago, and stressed that the fundamental reason for their collapse was debt.
He said: “We’re talking about a company that’s sitting on two billion dollars in debt and that’s about 20 percent of their revenue – it’s not a good place to be. And they did this – they took on this debt about 10 years ago – most of it was acquired.”
Discussing the potential consequences of Thomas Cook’s liquidation, he said that: “There’s a lot of uncertainty for people that are already travelling.
“A lot of people are now very nervous about package holidays. I could see that eroding trust in this business model going forward.”