TRAVEL operator Thomas Cook is cutting back its summer holiday programme from the UK – as economic uncertainty hits demand.
The group has reduced its capacity for the summer season by 1%. That contrasts with plans for a 3% increase when it updated the market last month.
Thomas Cook also said winter bookings from the UK were down by 5% on last year after the crisis in Egypt and Tunisia caused bookings to be cancelled.
The group confirmed that recent uprisings in the region will wipe £20m from its profits in the first three months of 2011.
Thomas Cook said it had taken a prudent approach to its holiday programme from the UK as a result of “fragile’’ consumer sentiment.
The group said 55% of its UK summer holidays had now been sold, up by 1% on last year, but this is partly a result of the reduction in its programme.
It has also scaled back the increase in its capacity for winter bookings, which it now plans to increase by 1% against a previously expected 4% increase.
The reduction in the number of winter bookings came after the turmoil in north Africa, which forced the group to cancel 110,000 holidays to Egypt and 40,000 holidays to Tunisia.
Thomas Cook expects the chaos to cost it £5m for organising additional flights to return holidaymakers to their homes and £15m in lost profit margin.
Although flights have now resumed to both destinations from most of its markets, the firm estimates its programme to these countries in the summer will be at 70% of the level originally planned.
While its UK business had seen a deterioration since its last update, Thomas Cook said its other markets were performing well, with particularly strong growth from its German business.