Thomas Cook warns of more cuts this year

The boss of Thomas Cook has warned of further cuts, especially in retail, to the business in the second half of the year.

It comes as the travel group suffered a drop in winter half-year losses to £1.45 billion on Thursday.

Chief executive Peter Fankhauser said there was softer demand in the UK due to uncertainty over Brexit.

An impairment of more than £1 billion in the UK business relating to the merger with MyTravel in 2007 was also cited as a primary reason for the deep losses.

Fankhauser said: “A range of cost efficiencies are planned for the second half of the year.

“We need to sharpen our focus on being efficient especially in retail stores.

Podcast: Who might buy Thomas Cook?

“We are following our customer behaviour and the more (consumers) are following into digital, the more we have to follow this trend.

“We review our retail network constantly and if a store is falling below profitability we are closing those shops.”

This week Cook announced 100 jobs were under consultation in its head office in Peterborough.

“We are reviewing and streamlining our operations. If you are closing shops you have to adapt your head office as well,” Fankhauser added.

Asked how much past events such as the merger with the Co-op affected the company’s current situation, Fankhauser said: “1,222 shops in in today’s world isn’t the best to have and we are focusing on our retail efficiency.”

Cook currently operates 580 shops.

Fankhauser said customers were “having a great deal” with so many holidays being discounted. “This summer, for the customer, it is paradise”, he said.

“We have very good demand for cities in the US and seen a new trend for short breaks to long-haul destinations.”

Fankhauser said a key focus for the company was its hotel business.

Cook has opened 12 of 20 new hotels this year in the last eight weeks. It is targeting 250 by 2021.

More: Thomas Cook Group losses plunge to £1.45bn

Share article

View Comments

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.