"The travel industry has bucked the trend in retail, where decreasing consumer confidence has depressed demand. Holidays are a `must have' rather than part of discretionary spending," said Mr Clubb yesterday.
Summer 1999 bookings are up 14 per cent on the same time last year, he said. Winter reservations are 6 per cent ahead.
First Choice, which reported a 59 per cent rise in full-year pre-tax profits before exceptionals to pounds 35m, is applying a "cautious approach" to summer capacity, which it will cut by up to 5 per cent, to avoid a repetition of 1995 when excess capacity led to huge discounting.
The holiday industry has had a turbulent year since the Monopolies and Mergers Commission allowed tour operators to sell directly through their own distribution arms. The big four - Thomas Cook, Thomson, Airtours and First Choice - scrambled to raise their shares of the high-street market.
First Choice, which bought the retail chains Baker's Dolphin and Intatravel in recent months, plans to treble the capacity of its 200-strong chain in the coming year, primarily through opening 20 "holiday hypermarkets" in retail parks.
The acquisitions boosted First Choice's full-year pre-tax profits to pounds 50m. The shares slipped 1p to 100p yesterday.Reuse content