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Holidays demand remains high - Thomas Cook

Graeme Evans,Pa
Wednesday 30 January 2008 08:07 GMT
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Holidays giant Thomas Cook today said it was in good shape for the year ahead after consumers showed no sign of cutting back on major foreign trips.

The company, which merged with Airtours rival MyTravel last year, said demand for both winter and summer holidays exceeded supply.

It added that tougher economic conditions had not impacted on trading, partly due to the "high priority" that European consumers place on foreign holidays.

The company said it also benefited from reduced capacity on loss-making routes, particularly to long-haul destinations.

Thomas Cook said: "By managing the number of holidays to be sold, we believe we are in a position to benefit from higher average selling prices and are less exposed to any future change in demand."

The update on trading conditions came as Thomas Cook posted annual profits from existing operations of 375.3 million euros (£279.1m), an increase of 26 per cent on a year earlier. The period covered the year to October 31.

It also said the integration of Thomas Cook and MyTravel had been "very successful" and was now largely complete.

The project involved the closure of 144 shops in the UK, leaving an estate of 812 - mostly Thomas Cook - stores. The company's UK headquarters have also been established in Peterborough after a number of offices were closed in a rationalisation programme.

Thomas Cook has become the company's lead brand, supported by Airtours in the mass market segment, alongside specialist brands such as Thomas Cook Signature, Cresta, Tradewinds, Nielsen and Club 18-30.

Thomas Cook Airways is now the company's only UK airline, operating with a single flight programme with effect from this spring.

The company said it was on track to achieve savings of at least 200 million euros (£148.8m) from the merger, which is an increase of 60 million euros (£44.6m) on its original forecast and up to a year ahead of schedule.

Rival operator TUI Travel said yesterday it planned to close 100 UK stores as part of £150 million of cost savings resulting from last year's merger of its tourism arm with First Choice.

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