Thomas Cook is reporting strong summer demand for Greece, Cyprus, Croatia and Bulgaria but a more ‘competitive’ UK market to the Spanish islands.
Announcing its interim results today, it said following strong growth last year, bookings to the Spanish islands have ‘levelled off in a very competitive market’.
"As we highlighted previously, our UK business is managing through a more competitive market to the Spanish islands, focusing on selling higher margin, quality holidays rather than pursuing volume growth," it said.
"As a result, charter risk pricing is up 8%, while bookings are slightly behind last year. For the UK as a whole, including seat-only and non-risk package holidays, both bookings and average selling prices are up by 2%."
With its summer 2017 programme 61% sold, in line with last year, Thomas Cook has also seen a ‘significant’ increase in bookings to Egypt in recent weeks with ‘customers attracted by the quality and value of the destination’.
"Demand for Turkey has also improved recently, with bookings now in line with this time last year," it said.
Overall, bookings for the group are up 12% compared to this time last year, with stronger demand for most destinations, especially Greece, Cyprus, Bulgaria and Croatia.
For the six months to March 31, Thomas Cook Group managed to trim losses by £27 million to £272 million.
Revenue increased by 3% to £2.9 billion year-on-year for the period, which Thomas Cook said was due to strong winter demand to Spain and long haul destinations.
"Thomas Cook has delivered a good performance in the first six months," said chief executive Peter Fankhauser.
"The progress we’ve made on our strategy helped achieve a 3% increase in revenues, with strong customer demand for our holidays despite the competitive environment."
Looking ahead, he added: "Despite continued overcapacity in the airline market and strong competition particularly in our UK business, based on current trading we expect underlying EBIT for the full year to be in line with current market expectations."
