Package holiday prices sold by Thomas Cook up 9 per cent for summer 2017

Increase is due to high hotel rates in Spain and firm's move to 'quality holidays'

Spain gain: hotels on the Mediterranean coast are commanding high rates (Simon Calder)

Partly because of the prevailing high prices in Spain, bookings to Greece for summer 2017 are up by nearly half. Customer confidence in Turkey is still in decline, but numbers to Hurghada in Egypt are increasing.

Thomas Cook has just announced its results for the first quarter of its fiscal year, covering October to December 2016.

Revenue for the first quarter rose by 1 per cent to £1,618m, with the usual seasonal loss £1m lower at £49m.

Peter Fankhauser, chief executive of Thomas Cook, said: “Bookings to Greece are currently up by over 40 per cent, while demand for destinations such as Cyprus, Bulgaria, Portugal and Croatia is also strong.

“These positive trends are making up for continued weak demand for Turkey.”

A basic self-catering package for a family of four on the Spanish island of Lanzarote, sold under Thomas Cook’s Airtours brand, costs £456 per person in early August, including flights from Gatwick, while a similar holiday in Marmaris, Turkey, is on sale for £382. On Greece’s largest island, Crete, a comparable Thomas Cook trip costs £422.

Demand for Greece last year was dampened by reports about large numbers of migrants passing through the islands.

Intense competition between low-cost airlines means that flight-only prices for the coming summer are no higher than last year. On Monday, Ryanair predicted air fares would fall during 2017.

Among long-haul destinations, Thomas Cook says Cuba and Mexico are proving popular, at the expense of Florida.

Mr Fankhauser added: “We remain cautious about the rest of the year, given the uncertain political and economic outlook.”

Shares in Thomas Cook Group ended the day nearly 8 per cent down.