Shorter holidays help TUI bookings

Bookings for 10-11 days or a week rather than the traditional fortnight’s break are rising, Peter Long, the Anglo-German travel group’s chief executive, said.

UK bookings overall have tailed off since the start of the year and were flat in the three months to March, though April picked up a little, he added.

Mr Long said TUI was outperforming other UK rivals such as Thomas Cook, helped by demand for its specialist resorts, such as all-inclusive holiday villages.

The Thomson owner cut its underlying losses by £15 million to £307 million in the latest six months to March. Sales rose by 5% to £5.21 billion.

The impact of the unrest of in North Africa cost it £29 million, with a late Easter meaning a further hit of £17 million. Good growth in its Nordics business and a turnaround in Canada were the strong points.

Mr Long expects the group to meet City forecasts for this full year, though he remains cautious about the outlook for bookings going forward.

“The UK consumer mood is not getting worse” he says, “but there is a lot of pressure on incomes”.

France, he adds, has been badly affected by the situation in Tunisia, Morocco and Egypt as North Africa accounts for about 70% of French holiday traffic.

All-inclusive holidays accounted for 46% of the UK bookings in the latest six months, up from 43%, while 10-11 night stays saw a 24% rise against a 7% fall for fortnightly bookings. Differentiated products rose by 16%.

Rising fuel prices added 3% to the cost of UK-booked holiday, though in Europe the fuel rise was offset by currency movements and hedging.

TUI also introduced fuel surcharges for the first time in March, which helped to recover some of the additional fuel bill, caused by soaring oil prices. Airline fuel costs are tipped by the firm to rise by 30% in 2012.