Beleaguered tour operator Thomas Cook has announced it will close 200 travel agencies over the next two years as it attempts to bring its debt under control.
The announcement comes as the second biggest holiday company confirmed pre-tax losses of £398million for this year, compared to a £42million profit in 2010.
As well as closing stores, the operator will sell off six planes from its fleet - mainly on long haul routes - work with paperless tickets and will roster retail and call centre staff in a bid to reduce costs.
Tough trading: The 170-year-old holiday firm will have to close 200 stores, while its airline has come under fire from passengers
Thomas Cook has been hit by poor trading in the UK due to the European economic crisis as well as the effects of the Arab Spring in Egypt and Tunisia, both major destinations for UK, French and Russian markets.
Staff in 115 of the stores are expected to be informed that their branch is due to close today, leading to the loss of 661 jobs. The rest of the store closures will be announced over the next two years. Around 1,000 jobs could be lost overall.
The company is also aiming to raise £200million through asset sales and has already sold its interests in five hotels and a golf club in Spain for £81million.
Added to around £40million already collected through the sale of Dutch business premises and hotels in Mexico and Tenerife, the company still has around £80million of sales to get through.
The company is also aiming to upgrade and relaunch its website in time for the peak New Year booking period.
It hopes to grow the current 25 per cent share of total UK online bookings to 40 to 50 per cent over time.
The group's future has been in question since it asked lenders to come to its rescue twice in five weeks, sending its shares into freefall in November.
However, the tour operator took out full page adverts in major newspapers following the scare to put holidaymakers' minds at rest.
Thomas Cook today confirmed trading had picked up since its agreement with the banks was announced and said summer bookings in Britain are up eight per cent. Its shares were up 2.9 per cent in early trading.
'We have instigated significant management changes and implemented a turnaround plan in the UK to address our areas of underperformance,' acting chief executive Sam Weihagen said
Back to basics: Thomas Cook has announced it will focus on its core package holiday offerings
However, the company was hit with another set of bad news as its carrier, Thomas Cook Airlines, was named worst short-haul airline in a customer satisfaction survey by consumer watchdog Which?
The carrier came below even Ryanair in the recent poll of 8,227 Which? members with a customer score of 37 per cent. Ryanair scored 38 per cent.
Swiss International Air Lines was voted the top short-haul airline by travellers, with a score of 76 per cent, followed by Aer Lingus at 67 per cent.
In the long-haul category, Singapore Airlines and Air New Zealand got first-class scores of 89 per cent and 88 per cent respectively with Emirates in third place with 80 per cent.
Rochelle Turner, Head of Research, Which? Travel said: 'The airline you choose can have a big impact on your trip, making the difference between arriving feeling tired or refreshed.
The top-rated airlines all score highly for both the cost and value for money of the flight and most still include free hold luggage, plus onboard drinks and snacks in the ticket price - something clearly prized by travellers.'
However, Thomas Cook has responded to the survey saying it goes against its own investigations into customer satisfaction.
Ian Ailles, CEO of Mainstream for Thomas Cook UK & Ireland said: 'The Which? Airline Satisfaction Survey results are in stark contrast to the high levels of satisfaction our customers tell us about.
'From our own survey - which is 84 times larger than the Which? report - customer satisfaction scores have increased year on year with 89 per cent of our customers rating their flight as either excellent or good for their holiday last summer.
'It’s impossible to see how this offers consumers a like-for-like comparison when Which? is comparing airlines with completely different product offerings that appeal to completely different customers. If Mrs Smith wants to fly with her family to Spain, a smaller scheduled airline with restricted flying programme is not going to be able to help her.'
He added: 'Unlike scheduled airlines, for most of our customers, our flights form part of their package holiday with us. An important factor is about getting them to their holiday destination on time and we came first in the CAA's on time performance table last year, and expect to perform similarly well when the new report is out.'