Crawley-based First Choice has brightened the picture for the holiday sector, reporting an encouraging level of bookings for 2003.

The industry has been rocked by the troubles of MyTravel, owner of Hove-based Panorama and Manos Holidays, but rival First Choice said in a trading statement it expected to meet targets for the financial year to the end of October.

The tour operator told the City: "Sales across the group for both the winter 2002/03 and summer 2003 periods are encouraging."

It also reported a 36 per cent increase in bookings since September 11 this year.

The confidence for the forthcoming seasons comes after a summer in which First Choice adopted a prudent approach in the face of tough market conditions.

The company cut capacity and costs as UK sales volumes for the summer period fell 11 per cent behind last year, although First Choice said today this was in line with expectations.

Volumes for forthcoming winter holidays were now only three per cent behind last year with the figure for next summer running two per cent ahead on this year and two per cent down on the 2001 season.

First Choice said the need to keep a focus on tight cost control and prudent capacity management continued but it still looked to the new financial year with confidence.

The update came a fortnight after MyTravel, formerly known as Airtours, stunned the market with its third profits warning in five months.

Shares in the group have plummeted, al-though MyTravel's problems have stemmed more from internal problems rather than poor customer demand.

First Choice has previously been touted as a bidder for MyTravel but it is thought the stricken group may be about to start talks with private equity houses about selling parts of its businesses to avert a debt crisis.

Shares in First Choice rose five per cent to 119.5p.