Thomas Cook to cut UK costs by up to £50 mln

Tour operator Thomas Cook said it planned to save between 40 mln and 50 mln pounds ($78 mln) through cost savings in its British business after reporting full-year earnings at the lower end of expectations.
Europe's second-biggest travel firm said it planned to cut 500 managerial and support jobs in the UK, renegotiate supplier costs and reduce its buying requirements, and upgrade its IT infrastructure. It expects the changes to cost 20 mln pounds to implement and that expense will be incurred in the 2010/11 financial year.
"We have taken further actions to simplify and streamline our UK business resulting in significant cost savings on an annualised basis which will help mitigate input cost pressures and any further deterioration in the trading environment," Chief Executive Manny Fontenla-Novoa said in a statement on Wednesday.
The group, which issued a profit warning in August, said in September it would look to cut costs and streamline its operations in Britain to prepare for expected tough conditions next year Thomas Cook reported an underlying operating profit of 391.4 mln pounds, down 5.7% on the previous year. Market expectations had ranged between 390 mln and 404 mln pounds, according to figures provided by the company.
The group is paying a final dividend of 10.75 pence, unchanged on the previous year.
Shares in Thomas Cook, which have lost nearly a third of their value since March, closed on Tuesday at 186 pence, valuing the business at 1.65 bln pounds.
Europe's biggest tour operator TUI Travel is due to report final results on Thursday.