Thomas Cook shares surge after winter bookings boost

United Kingdom sales were one per cent up on last summer, and bookings in Continental Europe were in line with last year’s figures, helped by a one per cent drop in pricing.

This means that Thomas Cook is forecast to post a fall in earnings of 28% for the current year which, while disappointing, is due to be more than offset by growth of 45% which is being pencilled in for next year.

Thomas Cook reported strong booking and pricing trends for winter 2015/16 and summer 2016 as it released its pre-close trading statement today.

It added that the strategy of investing in long haul routes was paying off, with “particularly strong growth in holidays to the U.S. and the Caribbean”.

Average selling prices in the United Kingdom have increased by 4% both for package (charter risk) holidays and for seat only bookings on Thomas Cook Airlines.

TUI Group, Thomas Cook’s larger rival, said on Wednesday trading had been robust over the summer and winter bookings were in line with expectations.

“In particular, we expect our China joint venture, which will develop domestic, inbound and outbound tourism activities for the Chinese market, to become operational by the end of 2015”, the company said.

Demand has continued to grow for its differentiated holidays, particularly to its own-brand hotels.

But the company warned that translating non-UK business profits into sterling would lead to a year-on-year decrease on profits of £39m, unchanged from its third quarter results estimate.

“Our trading performance for the summer season has progressed well, despite the impact of external shocks in certain destination markets, as previously announced”.

The urge to get away seems strong, with 39 per cent of winter holidays already sold.

He said progress has been made over the last three years to transform the business, and the focus is moving to the next phase.