Thomas Cook’s aircraft maintenance division has not been spared even the temporary reprieve experienced by the engineering arm of Monarch Airlines.
Financial firm KPMG has named three special managers for Thomas Cook Aircraft Engineering, who will support the liquidation of the company.
The maintenance company had turned in full-year net losses of £5.5 million ($6.7 million) for its last full year, which ended on 30 September 2018, contrasting with a previous profit of £2.5 million.
Sales were down to £35 million from a previous figure of £42.5 million. Thomas Cook Aircraft Engineering primarily serviced the fleet of Thomas Cook Airlines, although it also provided maintenance to other group carriers and third parties.
The firm, which says it was “reliant” on the support of its parent, had engineering subsidiaries in Mexico and the USA.
Just after Monarch Airlines ceased operations, in October 2017, its maintenance arm Monarch Aircraft Engineering posted net full-year profits of £9.2 million, despite the cost impact of closing a hangar earlier in the year.
The engineering firm emerged as a standalone company as the rest of the leisure carrier was broken up.
It attempted to build up business to fill the gap created by the demise of Monarch Airlines, and this even included taking over parts of the line maintenance activity of Thomas Cook Airlines at several UK airports.
But it laboured under debts in the first 12 months and efforts to restructure, combined with the loss of key customers, ultimately led to the company’s following Monarch Airlines into administration at the beginning of this year.
KPMG has been handling the administration of Monarch Aircraft Engineering. Its latest assessment of progress with the work, updated in mid-August, states that discussions have been held regarding the sale of the firm’s principal operating facilities, its hangars at London Luton and Birmingham airports.
Income has also been generated by the administrators in the meantime by renting the hangars to third parties for aircraft storage.
Nearly £2.8 million was raised through a piece-part sale of the company’s components stock, comprising some 6 million parts.
Monarch Aircraft Engineering had also operated a maintenance training academy at Luton. The administrators attempted to sell the business as a going concern but, given the staffing instability and a period of inactivity, this plan was abandoned in favour of a break-up.
Source: FlightGlobal.com
