Tour operator First Choice said holidays remained high up the list of spending priorities of consumers as it reported an increase in summer bookings.

The Crawley-based group, whose brands include Unijet, Falcon and Sovereign, said it was yet to feel any ill-effects from the widely-reported slowdown in household expenditure.

Summer bookings for mainstream holidays were up 11 per cent and travellers snapped up 33 per cent more specialist trips for the peak season than a year ago.

Activity holidays were also eight per cent higher this summer as the group built on momentum that saw it cut losses from its range of winter breaks for the third consecutive year.

The improved winter performance was reflected on the balance sheet, with overall losses narrowing by 15 per cent to £34.1 million during the six months to April 30.

Chief executive Peter Long said: "As yet, there are no signs the squeeze reported by some companies on consumer spending is having any impact on the holiday purchasing habits of our customers.

"We believe the annual holiday remains an extremely important purchase for our customers."

First Choice has reduced dependency on traditional holiday destinations by selling more higher-margin packages, including activity, specialist and long-haul trips.

It has halved the number of brochures over the past five years and secured a rapid increase in online sales, with a quarter of mainstream summer holidays now purchased on the web.

First Choice said the Asian tsunami on Boxing Day had cost its mainstream holidays business about £500,000 and its long-haul business about £700,000.

Wednesday June 15 2005