TUI Travel says strong summer to drive 10 pct profit rise
LONDON May 10 (Reuters) - TUI Travel, the world's largest tour operator, forecast a full year profit rise of at least 10 percent, driven by strong trading in Britain and the Nordics as it narrowed first-half losses.
The company, which owns the Thomson and First Choice brands, said on Friday summer 2013 sales in the UK and Nordics were up 13 and 14 percent respectively, adding that 58 percent of its overall mainstream summer programme was sold.
"Our drive to modern mainstream is contributing significantly to our outperformance in a number of markets where we are achieving strong booking volumes and improved margins," Chief Executive Peter Long said.
"Given current trading and the visibility we have within our businesses we anticipate full year underlying operating profit growth of at least 10 percent on a constant currency basis," he said.
TUI Travel, which is majority owned by German tourism group TUI AG has profited from a rising trend of budget-conscious travelers booking fixed price getaways. Analysts on average expect it to report a 9.2 percent rise in pre-tax profit, Reuters data showed.
It posted an underlying operating loss of 289 million pounds for the six months to the end of March, compared to a loss of 317 million pounds last time, citing a strong 2012/13 winter season which closed ahead of its expectations.
Tour operators and airlines generally report losses in their traditionally weaker first half of the year and make the bulk of profits over the summer months.
The company also increased its dividend by 10 percent to 3.75 pence per share.
Thomson Airways said last month it would start using its first Boeing Dreamliner on services from Britain to the United States and Mexico from July 8, as the passenger jets return to the sky after being grounded for months due to battery problems.
Shares in TUI Travel, which have risen by 21 percent since the start of the year, closed at 340.6 pence on Thursday, valuing the company at 3.83 billion pounds.
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