“Value driven” says the TUI Travel PLC website, but the tour operating giant has seen the value of its share price hit today after re-posting its 2009 results after an apparent IT accounting cock-up.
The company’s share price dropped almost 10% in early trading on the London Stock Exchange after a statement confirmed the resignation of finance director Paul Bowtell and a restating of its results to the year ending June 2009.
“Irrecoverable balances” accumulating since the merger of Thomson and First Choice in 2008 had risen from the £29 million previously reported in June 2010 to £88 million.
The monies relate to supposed integration of IT systems as a result of the merger, TUI says today.
The adjustments to the results today are “non-cash in nature” and will have no impact on TUI’s overall cash and net debt position, the company says in the statement.
Chief executive Peter Long says:
“It is now clear that at the time of merger there were weaknesses in the legacy systems we chose to use in the TUI UK business.
“Despite the fact that this situation had built up over a number of years, Paul is behaving honourably and I am disappointed that he will be leaving the group.”
The Telegraph today says problems discovered with the integration of IT for the UK business triggered the initial write-down. The exact nature of the problem is still to be officially explained.
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