Thomas Cook cutback on late bargains lifts prices

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The holiday firm, which came out of the merger of MyTravel and Thomas Cook last year, has deliberately cut back capacity with 10% fewer holidays available in the UK for example.

Despite this, the number of unsold holidays for the group has for the summer is 19% lower than this time last year. The firm said: "This should stand us in good stead in the lates market. We are particularly encouraged by our much lower level of stock left to sell in short and long haul."

The firm said that tighter management of capacity had helped push its average selling prices for the coming season is up by 2%. For the recently-finished winter holiday season, Thomas Cook said trading had been in line with its expectations.

Chief executive Manny Fontenla-Novoa saidthe group was on target to meet its expectations for the current financial year, as it moves the year-end to September.