Thomas Cook posts first annual bottom line profit for five years

Holiday firm Thomas Cook has posted its first annual bottom line profit for five years despite a £130 million sales hit from the Tunisian beach and hotel terrorist attacks in June.

The group said it had been a year of "considerable challenges" after also becoming embroiled in a crisis over its handling of the deaths of two children nine years ago from carbon monoxide poisoning at a hotel booked through the travel company.

Chief executive Peter Fankhauser said the group had "confronted its mistakes" following the Bobby and Christi Shepherd tragedy.

Thomas Cook posted profits after tax of £19 million - its first positive profit after tax since 2010 - while underlying earnings rose 11% to £310 million.

But it said the suspension of holidays to Tunisia cost the group £130 million in sales, with underlying earnings impacted by around £22 million.

The group said the new financial year had got off to a good start despite cancelling its flights to Sharm-El-Sheikh in Egypt after the downing of a Russian passenger plane last month, while Tunisia holidays also remain suspended for most markets.