Thomas Cook overcomes troubles in Egypt to cut loss

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HOLIDAY firm Thomas Cook has cut its losses by £10m despite the impact of Egypt’s political turmoil on bookings in the three months to December 31.

Revenues fell £15m to £1.66bn, but chief executive Harriet Green, who joined from Leeds-based Premier Farnell, said there has been progress in the company’s turnaround.

Excluding Egypt, Thomas Cook said revenues in the first quarter grew by 4.1 per cent on the year before.

Egypt has suffered three years of political upheaval marked by two presidential departures and hundreds of deaths as religious and military factions fight for supremacy.

Despite the turmoil, Thomas Cook’s underlying losses in the seasonally quieter trading period improved by £10m to £56m, reflecting the company’s focus on costs.

The company said 86 per cent of its winter programme has been sold, while the summer schedule is around 39 per cent sold, in line with last year.

Bookings for summer holidays are a closely-watched measure as they generate the bulk of the firm’s earnings.

Average selling prices are expected to increase as the company looks to sell a higher proportion of exclusive hotel offers to UK customers.

The tour operator is half-way into a three-year cost-cutting plan devised by Ms Green to turn the company around by slashing jobs, shutting branches and selling parts of its business.

Thomas Cook also announced the £45m sale of Gold Medal, a supplier of long-haul flights, hotels and car hire, to Dubai travel company dnata, which is part of the Emirates Group.

The sale of the business means the company has met its target to raise between £100m and £150m from the sale of non-core businesses some 18 months ahead of schedule. The agreed sale of Gold Medal brought disposal proceeds to £125m.

Gold Medal will continue as a supplier of long-haul scheduled flights to the Thomas Cook businesses in the UK.

Thomas Cook has announced plans to close its Birkenshaw office in January 2015.

Last year it closed a call centre in Bradford with the loss of 500 jobs.

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