BUSINESS
12/14/2011 04:09 EST | Updated 02/12/2012 05:12 EST

British tour operator Thomas Cook to close 200 stores, cut over 660 jobs, as economy bites

LONDON - British tour operator Thomas Cook said Wednesday it will close 200 stores after tourism to Tunisia and Egypt dried up in the wake of the protests earlier this year.

Europe's second largest tour operator said it will cut 661 jobs and close 115 of its stores immediately, with the remainder going over the next two years.

The group also reported its final year results Wednesday, after postponing their release as it sought new agreements with its creditors. It said its operating profit fell 16 per cent to 303.6 million pounds ($471 million).

The company said it has already begun selling off 200 million pounds worth of assets and will suspend dividend payments until the balance sheet improves.

Thomas Cook said it had been hit by several external shocks in the last few years. It suffered badly when the volcanic ash cloud from Iceland shut off European airspace in April 2010.

It also said that the Arab Spring had resulted in a dramatic fall in travel to Middle East and North African destinations and that its operations in Britain and France had underperformed as its traditional customer base of families with young children who holiday in its all-inclusive beach resorts decided to stay home instead.

Thomas Cook shares were down 7 per cent to 13.75 pence in morning trading.