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Thomas Cook to cut 2,500 jobs in UK Thomas Cook to cut 2,500 jobs in UK
(35 minutes later)
Travel group Thomas Cook has announced it will cut 2,500 jobs in the UK and close some stores as it attempts to revive its profitability. Travel group Thomas Cook has announced it will cut 2,500 jobs in the UK and close almost 200 stores as it attempts to revive its profitability.
Most of the job losses will come from its "back-office functions and its retail network", it said.Most of the job losses will come from its "back-office functions and its retail network", it said.
"Even after these changes we will still have one of the largest retail networks in UK travel," Thomas Cook said."Even after these changes we will still have one of the largest retail networks in UK travel," Thomas Cook said.
For the last financial year to September, the firm reported pre-tax losses of £485.3m.For the last financial year to September, the firm reported pre-tax losses of £485.3m.
It has blamed a "difficult trading environment" and higher fuel costs, and it has already closed 149 shops. Thomas Cook blamed the loss on a "difficult trading environment" and higher fuel costs, and it has already closed 149 stores.
"It is never easy to make decisions that impact directly on our people, but we also owe it to our customers to shape the business effectively and ensure that, when they book their holiday with us, our administrative costs are as low as possible," said Peter Fankhauser, Thomas Cook's chief executive for Europe and the UK."It is never easy to make decisions that impact directly on our people, but we also owe it to our customers to shape the business effectively and ensure that, when they book their holiday with us, our administrative costs are as low as possible," said Peter Fankhauser, Thomas Cook's chief executive for Europe and the UK.
'Right number of people'
Thomas Cook said that it would start a 90-day consultation process with its employees.
It plans to close 195 of its stores on the High Street - out of the 1,069 it currently has open - and cut about 16% of its workforce, focusing on posts at its head offices in Peterborough and Preston and the complete closure of its Accrington office.
It employs 15,500 people in the UK currently.
"It is essential that we operate with the right number of people as we move forward into the next era for our company, allowing us to meet the future needs of our customers more effectively," Mr Fankhauser said.
"We firmly believe these proposals will mean a better - more profitable - Thomas Cook that continues to be a major employer in the UK," he added.
Thomas Cook got into difficulty in 2011, when the unrest in the Middle East and North Africa affected its extensive operations in Egypt and Tunisia.Thomas Cook got into difficulty in 2011, when the unrest in the Middle East and North Africa affected its extensive operations in Egypt and Tunisia.
The company has since struggled with high debt and the wider downturn in the global travel sector. The company has debts of about £788m. The company has since struggled with high debt and the wider downturn in the global travel sector. It has debts of about £788m.
In May 2012, the group secured a £1.4bn refinancing package, giving it a further three years to repay its debts.In May 2012, the group secured a £1.4bn refinancing package, giving it a further three years to repay its debts.
In 2011, the firm issued three profit warnings and was forced to take an emergency £200m loan.