Europe's biggest travel company TUI Travel PLC (TT.LN) Monday said it's well placed to meet the board's expectations for the full year after robust trading in the past eight weeks.

TUI Travel said it was able to maintain strong pricing after cutting capacity. It met its targets for load factor - a measure of the number of available holidays that are sold - but witnessed slight weakness in March due to the later timing of Easter this year.

Average selling prices in the U.K. have remained 10% above last year, whilst customer volumes are in line with capacity reductions. As a result load factor is now 58%, flat on last year.

The travel operator said U.K. bookings in the last 8 weeks are down 11% on the year as cumulative booking fell 17%.

The number of customers booking long-haul destinations was down 25% from Jan 1 to May 3, but - depsite an 18% drop in sales - average selling prices increased 10%. For medium-haul trips, demand fell 14% but average selling prices were up 11%.

Demand for long haul has been particularly strong in recent weeks, TUI Travel said, despite the outbreak of swine flu. That caused a switch in demand from Mexico, where the outbreak originated, to other medium- and long-haul destinations, such as Jamaica, which was up 30% in the last two weeks. Demand to Egypt was up 23%, whilst demand for the Dominican Republic rose 19%.

The company said of its 2,500 customers who were in Mexico at the time of the outbreak, only about 10% accepted the offer of early flights home.

The trend towards non-euro destinations continues, especially to Egypt and Turkey, as customers seek to benefit from exchange rates.

The company added that discounts by third party distributors in Germany helped it achieve higher margins per customer despite lower average selling prices. However, in the last eight weeks, bookings were down 12%, whilst cumulative bookings since Jan 1 were down 10%.

The winter 2008/09 season closed in line with the company's views.

At 0749 GMT, TUI Travel shares were down 2.2%, or 6 pence at 262 pence.

Company Web site: www.tuitravelplc.com

-By Kaveri Niththyananthan, Dow Jones Newswires; 4420 7842 9299; kaveri.niththyananthan@dowjones.com
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