Thomas Cook has released a positive interim statement, saying its business transformation is firmly on track.
Chief executive Harriet Green said although trading conditions remain "challenged" she is confident of a turnaround.
"We have seen stronger operating performances in our major markets – the UK, Germany and the Nordics," she said.
"I am particularly pleased with the improved performance in the UK as the benefits of the turnaround plan are reflected in its operating results.
"Our business transformation is firmly on track. We have further strengthened our leadership team and the pace at which we are driving change gives me confidence that together we will achieve our near term objectives and much more.
"The business has generated higher gross margins than we did last year and this will remain an area of focus for us through the financial year.
"Our cost-out initiatives and improved cash management will be important contributing factors to the Group’s future performance and continue to receive strong focus in all parts of the business.
"Although global economic conditions and consumer confidence remain challenged, our business transformation is firmly on track."
Thomas Cook reported revenues of £1,724 million in the three months to the end of December, with a gross margin of 21.9%, up 1.3 percentage points over the same period last year.
Underlying operating profit improved to losses of £70 million, compared to £93 million in 2012.
The group plans to achieve annual savings of £100 million by 2015 and has identified another £60 million of savings.
by Bev Fearis
