Strong average selling prices and capacity cuts have led to “pleasing” preliminary results for TUI Travel, despite the tough economic climate.
Underlying profits grew 11% to £443 million in the year to September 30, while revenue remained flat. The group said summer 2009 had finished in line with expectations, thanks to achieving required load factors and average selling price.
In the UK, the number of customers booked to travel during winter 2009/10 is down 16% overall, but there have been signs of improvement in the last few weeks, reflecting the trend towards late booking.
Capacity reductions mean the company now has 13% fewer winter holidays left to sell in the UK. Selling prices remain strong, with winter holidays up 10% on last year.
Summer 2010 UK trading remains encouraging, with bookings down 3%, said the group. Average selling prices are up 7% for packages, reflecting a shift away from short haul to higher value holidays.
TUI Travel chief executive Peter Long said: “Our customers’ behaviour has demonstrated that even against a backdrop of reduced consumer confidence, the main summer holiday is an essential expenditure.
“We have managed capacity carefully for the current winter season and as a result remain confident that we can meet our Board’s expectations for 2010.
The merger of First Choice and Thomson is progressing well, said the group, having delivered £120 million of synergy benefits in the year.
In the UK, this included full integration of the Thomson and First Choice cabin crews and pilots from May 1 and the successful integration of Island Cruises with Thomson Cruises.