Thomas Cook silent on job cuts as losses increase

STRUGGLING tour operator Thomas Cook today reported increased losses, but offered a ray of hope in the form of robust bookings for the coming summer.

The company which came close to collapse in November after dire trading forced it to turn to its banks for additional support, reported pre-tax losses of �151.7million for the three months to December 31, compared with �99.3m in the same period a year earlier.

But the UK’s second biggest travel company said cumulative bookings for summer holidays were 1% lower than a year ago, which was ahead of rival owner of Thomson Holidays, TUI Travel, which yesterday reported a 7% dip.

There was no update, however, on the plans announced by Thomas Cook in December to close 200 travel shops the UK over the next two years, as part of a turnaround strategy in response to a loss of �398m for the year to September 30.

A spokeswoman for Thomas Cook said today that no branch closures had yet been confirmed, with the company still involved in a 90-day consultation period in respect of the planned job losses.

Thomas Cook had more than 20 branches in East Anglia, with its network in Suffolk including stores in Ipswich, Bury St Edmunds, Lowestoft, Woodbridge, Felixstowe, Sudbury, Stowmarket, Haverhill, Newmarket and Mildenhall.

In north and mid Essex, the company has two branches in both Colchester and Chelmsford, and other stores in Harwich, Halstead, Braintree, Witham, Saffron Walden and Maldon.

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The 170-year-old company, which currently has 1,300 UK shops in total, saidi t was progressing with its turnaround plan, which also includes focusing on fewer and better quality hotels and a drive for more online bookings.

Thomas Cook chief executive Sam Weihagen said today: “We are fighting back. We’re taking the necessary steps to rebuild confidence and margins.”

The group, which has seen its share price plunged 91% in the last year amid a series of profit warnings, also plans to sell �200m of assets over the next 18 months as part of plans to take a chunk out of its debt mountain, which rose by 11% to �891m last year.

The group today announced plans to sell its majority stake in Thomas Cook India and has received a number of informal expressions of interest, which include European businesses as well Indian companies. It also said it will lose six aircraft from its fleet this summer.

The first-quarter losses were driven by tougher trading conditions and rising fuel costs, Thomas Cook added, as revenues actually increased 3% to �1.9billion.

Winter bookings at the firm are 4% lower than a year ago and with the season closing in April, are currently 76% booked.

However, the group said it did not intend to slash prices to boost winter bookings towards the end of the season.

Mr Weihagen confirmed that figures reported last month showing a 33% drop in bookings in the first two weeks of January were correct but were “taken out of context”.

The outlook for the summer was better with bookings down 1% as low demand for its mainstream holidays had been offset by a surge in bookings for its specialist and independent businesses, such as Hotels4U and Medhotels, he said..

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