Thomas Cook’s sales and average selling prices for summer 2014 are 4% down on last summer.
But the group said the recent booking volumes in the ‘lates’ market have ‘improved significantly’, indicating a later booking pattern for the summer season than last year.
"In the last few weeks we have seen an improved tendency on late bookings," said group COO Peter Fankhauser.
"We expect the strong demand we are seeing in the ‘lates’ market to continue, along with increased demand for city breaks, winter sun and concept hotels product."
He said seat-only bookings were also currently strong.
Fankhauser blamed the lower average selling prices this summer on product mix and a higher proportion of shorter duration holidays, reflecting customer demand.
But he said the group was seeing increased consumer confidence in the UK market ‘giving us confidence that it is moving in the right direction’.
Thomas Cook also expects selling prices to improve over the medium term as it sells a higher proportion of exclusive hotel product to UK customers.
"Bookings for these products have shown strong growth for the Summer 2014 season, and we expect that this will make a more meaningful impact on average selling prices in 2015 as we further expand our concept hotel offering in the UK market," It said.
Meanwhile, Thomas Cook said it was ‘very encouraged’ by early winter 14/15 bookings, which are over 7% higher than last year in the UK with an increase in average selling prices of 3%.
"This demonstrates early tangible benefits of our enhanced product and Winter Sun strategy," it said.
Thomas Cook gave the summer and winter trading updates as it announced a £32 million rise in underlying EBIT in the third quarter of the financial year.
"Every business improved and the UK delivered the most significant contribution, accounting for over three quarters of the total rise, as we start to realise its full potential," said chief executive Harriet Green.
The group said the UK was the ‘stand-out performer’ with EBIT more than doubling to £27 million.
Thomas Cook reported UK profit margin for the 12 months ended 30 June up to 3.1%.
It said this reflected the ‘successful and sustained delivery of the first wave of our cost out and profit improvement measures’.
"We remain confident that our target EBIT margin of at least 3.5% is achievable for the UK business in FY14. We expect UK EBIT margin to improve further to over 5% in FY15 as our product strategy begins to deliver more substantial margin benefits to supplement the cost reduction measures that we have already implemented," it said.
