The Thomas Cook Group has now sold 77% of its UK winter 2009/10 stock while the average selling price has increased by two percentage points in the last four weeks.
Speaking at the release of its first interim management statement since October 1, group chief executive Manny Fontenla-Novoa said the amount stock sold is broadly in line with the same time last year.
He added the average selling price has increased from being 6% ahead of this time last year to 8% in the last four weeks, largely thanks to the group’s strategy of moving towards higher margin, medium haul destinations which represent 82% of the winter programme.
The increase has been further driven by an 11% increase in customers wanting more profitable all-inclusive holidays while demand for four and five-star properties is also on the up.
The group’s decision to feature more of the higher margin medium haul destinations has been mirrored in its strategy in the UK for the summer 2010 market.
Although Fontenla-Novoa said sales for the season got off to a slow start because of the bad weather, he added bookings are strengthening and will continue to do so.
Average selling price is up by 2% while in the last four weeks bookings have increased by 15% with improved margins although cumulative bookings are still 8% down.
Capacity for the season has been reduced by 3% and the Fontenla-Novoa said the group is in a strong position for summer 2010.
He added the group independent UK businesses are also trading well with Hotels4u seeing a doubling of bookings while Gold Medal Netflights Retail has seen 40% growth.
The operator also completed its acquisition of Gold Medal in December, buying the remaining 49.99% stake.
As a whole, the group saw its revenue decrease in the first quarter by 6% due to planned capacity reductions and higher fuel costs.
Due to lower finance costs and reduced exceptional items, the seasonal loss before tax was reduced year on year by £30.5 million to £81.5 million.
Fontenla- Novoa said: “We are pleased to report a £30.5 million reduction in seasonal loss before tax for the first quarter, as a result of lower exceptionals and finance charges.
“The operating loss before exceptional items of £41.3 million was £13.9 million higher than the prior year, mainly as a result of planned capacity reductions.
“The full year results are underpinned by our strong summer programme weighted towards higher margin, medium haul destinations.
“As a result of this and our cost reduction plans, we are confident that the group will perform in line with Board expectations.
“Winter trading is trending towards our planned capacity reductions and prices have been largely stable since we last reported.
“In recent weeks, bookings for the summer 10 season have improved significantly, marking a positive response to our current marketing campaigns and highlighting the resilience of the summer holiday.”