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Thomas Cook UK Earnings, Shares Down

Travel company Thomas Cook has reported lower-than-expected UK profit margins due to highly competitive conditions in the travel industry.

The well-known travel brand recently reported a 40% decline in its UK earnings, fuelled by a “challenging” travel market and a cut in total revenue caused by a weakened pound. For the year to September 30, Thomas Cook generated earnings of £52 million — lower than the £86 million reported during the previous 12 months.

Thomas Cook is one of several travel companies to face a decline in earnings over the past year. Others, including numerous low-cost airlines, have reported declining profits due to an increasingly intense price war and difficult currency conditions.

The weakened pound has hurt many holiday providers, the majority of which price services in pounds before purchasing accommodation, tour packages and other services in euros. Rising hotel prices have also been blamed for this year’s lower-than-expected profit margins.

In its statement, Thomas Cook reported that a high level of competition for Spanish package holidays also contributed to its smaller margins. The company has also been set back by the costs of reimbursing customers after Hurricane Irma.

Finally, the company reported that fraudulent illness claims cut into its 2017 profits, costing the company a significant amount. Executives have reported that there may be legal action against individuals that make fraudulent illness claims.

To reverse the downturn in earnings, Thomas Cook plans to focus its offerings on inexpensive, rapidly growing destinations such as Egypt and Turkey, both of which have seen an increase in demand over the past year.

Despite poor earnings from its UK division, the Thomas Cook Group has had a positive year on the whole. The company’s earnings grew by £24 million to a total of £330 million, largely due to increased customer demand.

Bookings for the winter season are currently higher than expected, with the company noting a 5% increase in total booking volume fuelled by customer interest in warm destinations such as the Canary Islands.

A persistent price war has affected UK-based holiday companies that focus on destinations like Spain, where limited availability and an increase in demand has resulted in higher-than-normal prices for hotels and holiday apartments.

Due to Spain’s image as a safe holiday destination and the weakened pound, Thomas Cook and other travel companies predict that the price of holidays to Spain will continue to rise by anywhere from five to 10 per cent over the next year.

The challenging market conditions haven’t only affected holiday tour companies. Earlier this year, UK-based Monarch Airlines ceased trading due to financial difficulties, leaving 10,000 holidaymakers stranded overseas.

Even the industry’s most robust companies have reported lower-than-anticipated profits, with budget airline easyJet stating a 17% annual decrease in profits. Chief executive Carolyn McCall described the year as a “difficult” one for the entire travel industry.

Still, with demand increasing and bookings on the rise, 2018 could potentially be a year of new opportunities and financial turnaround for many of Britain’s airlines and travel service providers.

Meg Whitman to Leave HP Enterprise

Meg Whitman will step down from her role as chief executive of Hewlett Packard Enterprise in February, approximately six years after joining the company and overseeing a significant effort to turn around its direction.

Whitman joined Hewlett-Packard’s board of directors in January 2011 and was appointed CEO in September of the same year. After joining the company, she prioritised a commitment to the PC business — a product range that HP had previously considered ending.

Under her leadership, HP became the world’s largest manufacturer of PC equipment — a title it held until being surpassed by Lenovo in 2013. The company also went through a series of large job cuts, with tens of thousands of positions cut from 2013 onwards.

Whitman’s leadership of Hewlett-Packard was controversial. The CEO inherited a company in a challenging position and ultimately prompted HP to break into two separate companies,  HP Inc. and Hewlett Packard Enterprise.

After retiring in February, Whitman will be succeeded by Antonio Neri, the current president of Hewlett Packard Enterprise.

Hewlett-Packard’s split saw the pany transform from one business into two companies. The consumer side of the company was converted into HP Inc., which produces PCs and home electronics such as printers and scanners.

Hewlett Packard Enterprise has since run the company’s corporate software and hardware product lines, including services such as data storage and corporate networking equipment.

One of Silicon Valley’s oldest companies, HP was founded in the 1960s and grew into a key early player in the computer hardware industry. Throughout the 1970s and 80s, HP released many of the world’s most important calculators and early personal computer equipment.

HP expanded throughout the 1990s, doubling in size throughout the decade and completing a merger with Compaq later described as “disastrous.” The company completed several major acquisitions throughout the early 2000s, including a purchase of Palm, Inc.

Since splitting into a separate company, the value of Hewlett Packard Enterprise has remained roughly the same as it was prior to the split. Company representatives have noted that owners of Hewlett Packard Enterprise shares have benefited from recent dividends and buybacks.

In spite of this, HPE has continued to slash jobs and downsize its workforce since becoming a separate entity. In September, the company announced that it would cut as much as 10% of its workforce in an effort to reduce costs and remove underperforming divisions.

Many of HPE’s challenges relate to enterprise cloud storage, where the company has lagged behind rivals such as Google and Amazon Web Services.

Despite being called one of the world’s most “underachieving CEOs” by Bloomberg in 2013, Whitman’s tenure at HP has generally attracted praise from analysts. In a New York Times piece on her resignation, analyst A. M. Sacconaghi stated that Whitman was given “a tough hand in a legacy business” and was “a complete realist” about her role at HP.

Whitman will remain with Hewlett Packard Enterprise until February, at which point she will be replaced by Antonio Neri. Neri has served as HPE’s president since June and has a 20-plus year history with the company and its predecessors.

Amazon Australia Soft Launch is Underway

Amazon’s long awaited opening in Australia is underway. On Friday, Amazon.com.au, which has long been a popular shopping destination for Kindle content and other digital products, will start to feature a range of physical products similar to Amazon.co.uk and Amazon.com.

Amazon Australia is currently undergoing a “soft launch,” which has been dubbed as something of an anti-climactic event by the Australian media. The full website is currently only available to a small test audience, with the new product categories expected to launch on Friday.

The new version of the website will reportedly feature a full range of product categories similar to the American and UK Amazon stores, offering everything from consumer electronics to toys, groceries and more.

Details of the soft launch were leaked after Amazon sellers received emails alerting them that their Australian product offerings needed to be ready by “2pm AEST Thursday” to be viewable on the website.

The current Australian Amazon website only features a limited number of product categories, with Kindle books and other digital content but little else. The newer, expanded marketplace is hotly anticipated in Australia, where e-commerce options are less numerous than the USA.

Millions of Australian consumers already shop using the UK and USA Amazon stores, often for goods that are not available in Australia. Purchasing items internationally is a popular way for consumers to avoid the “Australia tax” of inflated pricing that often applies to imported goods.

Amazon has confirmed that Australian users will still be able to shop from its US and UK online stores — something that’s reassured many customers. However, many of the items sold on the company’s US and UK platforms may be more affordable to purchase locally via Amazon AU.

According to the Daily Mail, some analysts have predicted that Amazon’s prices will be as much as 30% cheaper than other merchants in Australia — a welcome sign for Australian consumers.

However, other have pointed out that this sudden reduction in pricing for many consumer goods could create difficulties for local retailers, many of whom haven’t been subject to the same level of pricing pressure from Amazon as their UK and US-based counterparts.

According to the Australian Financial Review, the marketplace’s launch is expected to trigger “the biggest shake-up in retail in a generation.”

Amazon has grown tremendously over the past decade, expanding from an online marketplace for books into the world’s largest e-commerce company, supplying approximately one third of all online product purchases.

The company has also expanded into areas such as original content creation and cloud storage, with its Amazon Web Services division contributing substantially to its recent revenue growth.

Other recent moves by Amazon include its successful $13.7 billion acquisition of Whole Foods, a health-focused grocery chain. The company’s stock price has increased from $750 near the beginning of 2017 to a recent peak of more than $1,000 in July.

With its Australian opening underway, it appears that Amazon’s growth story has plenty of room to continue.

Can Tesla’s New Truck And Roadster Help it Escape “Production Hell”?

Tesla unveiled two new models last week, an electric semi truck capable of covering up to 500 miles on a single charge and an updated, upgraded version of its famous Roadster. But can the new models help the exciting but troubled automaker escape its current “production hell”?

The California-based automotive company’s latest announcements aren’t likely to reach stores anytime soon. However, Tesla as a company is facing very real challenges producing its Model 3 sedan, an affordable electric vehicle aimed at transforming the brand into a mass market one.

Tesla has, until now, produced high-end cars aimed at a market of customers interested more in cutting edge technology than affordability. But the Model 3 takes a different approach — one that could potentially create problems for the growth-focused company.

Contrary to Elon Musk’s ambitious projections and announcements, Tesla has struggled to keep pace with manufacturing its mass market vehicle. The company planned to produce 1,600 cars in September; it only managed to produce 220.

A Washington Post article from earlier this month reported that Tesla’s current “production hell” included broken assembly robots, sleepless nights for employees and a mounting pressure to deliver on the company’s production promises.

Around the same time as the Model 3 “production hell” hit full swing, Tesla announced its largest ever quarterly loss — a total of $671.1 million for the third quarter. Tesla also recently announced a series of layoffs, ostensibly due to employee performance problems.

The recent announcements breathed new public relations life into Tesla, but both the Roadster and the company’s new semi truck have resulted in the same questions from commentators — namely, when they will move from announcement to reality.

The new models have also come under scrutiny from industry experts, who believe the electric vehicle company’s ambitious plans for the commercial and industrial transportation industry are perhaps too ambitious to become true.

Key concerns from the trucking industry include the vehicle’s reliability, particularly compared to the 100-plus year old diesel technology used in today’s trucks. In this setting, dependability is a bigger selling point than technological innovation or green credentials.

Others include the time at which vehicles will be available. With Tesla’s reputation for delivering a quality product, albeit often late, major companies that depend on vehicular uptime might not be ready to put down deposits for a vehicle that may not ship on time.

The new Roadster, on the other hand, has won over praise from automotive journalists. With a 0-60 time of just 1.9 seconds, the proposed car could potentially be the fastest ever made when it enters into production.

In fact, the Roadster’s performance is so spectacular that numerous commentators have urged Tesla to build a racing team around the platform.

In short, it’s an exciting but difficult time for the innovative California-based automaker. Tesla is mired in “production hell” and aside from a few recent PR wins, doesn’t seem to have a proven way out of it. However, its recent announcements have certainly won the company attention.

Easyjet Weathers 17% Profits Decline From Price War

Basel, Switzerland - April 11, 2011: Operatives load luggage onto an easyJet branded Airbus A319-111 parked on the apron at Basel airport. The low-cost British airline easyJet carries more passengers that any other United Kingdom-based carrier, serving airports in Europe, Noth Africa and Eastern Asia. easyJet calls itself the web's favourite airline.

EasyJet’s annual profits have declined by 17% over the past year, with the company weathering a £101 million reduction in earnings due to currency fluctuations and the effects of a short haul flight price war.

The budget airline, which specialises in short haul flights between the UK and Mainland Europe, has suffered through a two-year price war with rival airlines, all competing for a lucrative market of weekend travellers.

Prices for short haul flights have been pushed down over the past two years due to an intense level of competition between airlines. Although the low prices have been good for consumers, a growing number of airlines are facing financial issues as a result of the aggressive pricing.

Earlier this year, German “semi-low cost carrier” Air Berlin filed for insolvency, ending operations at the end of October. UK-based Monarch Airlines also ceased trading recently, stranding over 110,000 passengers abroad as it abruptly closed its doors.

Compared to many of its competitors, easyJet appears to have weathered the effects of pricing wars relatively well. The company has increased its bookings over the past year and expects its revenue per seat to grow substantially over the next 12 months.

Chief executive Carolyn McCall, who is leaving the company for ITV, stated that the year was a “difficult” one for the industry as a whole. McCall noted that easyJet’s performance over the year had been “robust” and that the company had performed well in a difficult period.

Her optimism appears to be shared by investors, with easyJet shares increasing by 6% after the company’s financial results were released to the public.

Despite the slight decline in profits, easyJet hit several other performance targets over the year, often as other airlines faltered. It achieves a record-setting load factor of 92.6%, indicating that it filled its planes efficiently to maximise revenue per flight.

EasyJet also flew a record 80 million passengers over the course of the year, hitting its highest ever total amount. Analysts have described the airline’s financial outlook as “encouraging” — a rare description in an industry that’s recently become infamous for financial difficulties.

Both easyJet and other budget airlines have numerous opportunities ahead, with the coveted slots operated by former rival Monarch Airlines soon to become available to other carriers.

Monarch previously held valuable take-off and landing slots at two UK airports, operating from Luton and Gatwick. The slots are a lucrative asset for any airline, and it’s expected that a range of low-cost carriers will attempt to acquire them.

EasyJet also benefited from issues with its key rival RyanAir, which has seen more than 700 of its pilots leave over the past 12 months — an increase of 75% from previous years. Many of the pilots have attributed their decisions to boss Michael O’Leary’s “utter contempt” for staff.

Despite the resignations, the Irish low-cost airline planes to continue its expansion, announcing that it will hire up to 200 engineers across Europe as it puts into action plans to expand its fleet of aircraft from 430 to 585.

Uber “Covered Up” 2016 Hacking Attack That Compromised 57 Million Users

San Francisco, USA - May 12, 2016: Uber headquarters entrance in San Francisco with sign on the right. A woman is leaving the building through the front door. Reflections of Market street in the window.

Uber has ousted its chief security officer after it was revealed that the company “covered up” a massive cyberattack that compromised the personal information of more than 57 million users.

Chief security officer Joe Sullivan and deputy Craig Clark both resigned recently in response to the attack, which was disclosed earlier today by Bloomberg News reporter Eric Newcomer. The cyberattack is believed to have affected more than 50 million users and seven million drivers.

Uber CEO Dara Khosrowshahi, who replaced founder Travis Kalanick as CEO earlier this year, stated that “none of this should have happened,” referencing the attempt by Uber to hide the full effects of the hack. He also stated that Uber “will not make excuses” for the decision.

According to reports, former CEO Travis Kalanick was informed of the hack late last year. Uber did not disclose any information about the cyberattack to its drivers or users, potentially creating privacy issues for its customer base.

The hacked data included the names, phone numbers and email addresses of approximately 50 million Uber customers. Around seven million drivers were affected, with driver’s license data for approximately 600,000 people compromised.

The hackers reportedly targeted Uber’s Amazon cloud account, “breaking in” to the company’s online records. Uber paid out $100,000 to the hackers to ensure the security break-in wouldn’t become public and prevent the data from being shared with others.

Sullivan, who has attracted much of the public attention for the “coverup” of the hack, joined Uber in 2015. He previously worked for Facebook as an online security specialist, as well as auction platform Ebay.

Uber representatives have publicly stated that the hack did not affect sensitive user data, such as credit card numbers, location information or bank account data. The hackers also failed to access private personal information such as social security numbers or birth dates.

Uber’s failure to disclose the hack could potentially have legal repercussions for the company. In California, where Uber is based, companies are required by law to report any data breach that affects more than 500 residents of the state.

Downplaying the impact of the hack, Khosrowshahi stated that Uber “obtained assurances that the downloaded data had been destroyed” by the hackers, and that the company has since taken steps to improve its digital security.

Uber will also offer free identity theft protection and credit monitoring services to its drivers to limit the effects of the cyberattack. The company’s statement on the hack and its outcome can be read here.

The 2016 hack could be the latest legal issue in a long list of problems for Uber, which has been plagued by sexual harassment claims over the past year. The New York state attorney general’s office has reportedly opened an investigation into the company’s slow response to the hack.

Other companies have been fined hundreds of millions of dollars for similar data breaches that affected large numbers of users. A 2015 security breach at Anthem Inc cost the company over $115 millions in fines and settlements.

Concordia Healthcare “Overcharged NHS by 6000%”

a group of four young trainee nurses including male and female nurses , walk away from camera down a hospital corridor . They are wearing uk nurse uniforms of trousers and tunics.

A Canadian pharmaceutical company has been accused of deliberately overcharging the NHS more than £100 million over the past 10 years.

Concordia Healthcare, which was founded in 2012 and owns numerous pharmaceutical brands, allegedly hiked the price of liothyronine, a medicine used to treat thyroid disorders, by more than 6,000% over the past decade.

Although the company was founded just five years ago, Concordia has pursued a “growth via acquisition” strategy and operates a number of pharmaceutical brands. The company allegedly began its overpricing strategy in 2007.

According to the Competition and Markets Authority, Concordia began increasing the price of its thyroid medication in 2007. Over the last decade, the cost of a single packet of liothyronine paid by the NHS has increased from £4.46 to a staggering £258.19.

This price increase occurred despite the manufacturing costs of liothyronine remaining stable, according to a statement from the CMA.

Liothyronine is an essential medicine for treating a variety of thyroid conditions. People with an underactive thyroid — medically referred to as hypothyroidism — often use liothyronine to treat a deficiency of natural thyroid hormone production.

Hypothyroidism affects an estimated two people in every 100 and results in a variety of major symptoms, ranging from fatigue and lethargy to weight gain. Liothyronine is considered one of the only treatments for hypothyroidism for patients that fail to respond to levothyroxine.

According to the CMA, Concordia Healthcare could be fined as much as 10% of its worldwide annual revenue in response to the overpricing scandal.

In a statement, CMA chief executive Andrea Coscelli stated that drug companies that “abuse their position and overcharge for drugs” force UK taxpayers to overpay for medical treatments and care.

Coscelli also stated that the CMA’s findings are “provisional” and that the company hasn’t yet been found to have violated competition law.

Concordia is not the only pharmaceutical company to face public and regulatory scrutiny for its pricing strategy. American drug giant Pfizer was recently forced to pay a record £84.2 million in fines after it was found to have overcharged the NHS for a vital anti-epilepsy medication.

The medication in question, which contains phenytoin sodium, is used by approximately 48,000 people in the UK to treat epileptic seizures. Pfizer reportedly increased the price of the drug by 2,600% overnight, resulting in significant unexpected costs for UK taxpayers.

According to the CMA, Pfizer’s decision took advantage of a practice by the NHS that prevents patients from being switched to alternative medication brands. As a result of the price increase, the NHS spent more than £50 million on the drug in 2013, compared to £2 million in 2012.

Pfizer was also found to have overcharged UK health services specifically, offering an identical drug for a significantly lower price to healthcare providers in other European countries.

The decision to find Pfizer is currently under appeal. Currently, the CMA has publicly stated that it will consider representatives from Concordia before moving forward with a legal decision over the company’s pricing tactics.

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