Following the terrorist attack on a Tunisian beach earlier this year, Thomas Cook predicted a significant drop in revenue for the year.
However, the holiday operator has reported that it is doing well, despite one of its key destinations being effectively off limits for tourists. Tunisia's beach resorts have seen visitors drop by more than one million since the tragic events in July.
Thomas Cook says that sun-seekers are heading to destinations like Greece and Egypt instead of Tunisia, and the firm has seen a boost in sales to holiday destinations like the UK and northern Europe.
It said its turnaround programme was doing well and that the next stage was to provide a "higher quality and more focused holiday offering".
Summer capacity in the UK was 95 per cent booked, up one per cent compared to the same period last year. In addition, northern European holidays were 99 per cent booked, with prices for the region up by four per cent.
The group has also worked on expanding its long-haul routes, and has seen sales rise for holidays to the US and Caribbean. Its Airlines Germany business sold 89 per cent of its summer capacity. Bookings for that part of the business were were up seven per cent and prices were up one per cent.
Thomas Cook warned, however, that it was facing higher competition in central Europe, and this has led to a one per cent drop in prices for the region. Booking levels were also flat compared to the same period last year, with 90 per cent of capacity sold.
In addition, the firm says it expects a £39 million hit from the falling value of the euro – profits from the Eurozone will not be as strong when converted into sterling.
Chief executive Peter Fankhauser said: "Our trading performance for the summer season has progressed well, despite the impact of external shocks in certain destination markets, as previously announced."
He noted that more than one-third of the winter 2015/16 season was already sold and that the bookings profile for next year was also "encouraging".
Mr Fankhauser explained there had been "excellent progress" in transforming the business over the last three years. "We have developed a strong core holiday proposition based around our own-brand hotels, reduced our cost base and strengthened our capital structure," he said.
On Friday morning (September 25th), shares in Thomas Cook group were up 0.50 per cent to 119.60.
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.