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TUI Travel Annual Profit Up 13 Percent

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TUI Travel, the world's biggest tour operator, said it had seen encouraging booking levels for next summer after the sale of more expensive vacations helped it to post a 13 percent rise in full-year profit.

The British group, which owns the Thomson and First Choice vacation brands, posted underlying operating profit of GBP£555 million (USD$909.45 million) on a constant currency basis for the year to the end of September on revenue up 4 percent.

Annual profit growth of 13 percent was higher than the 11 percent the company forecast in September, when strong demand for winter vacations prompted it to lift guidance from an estimate of 10 percent given in August.

The company has a five-year annualized target of underlying profit growth of 7 to 10 percent on a constant currency basis, which it said it was confident it would deliver.

"The business continues to deliver sustainable growth through our unique holiday experiences, increasingly distributed online, whilst leveraging its scale as one organization. This in turn, will drive further value for both our customers and shareholders," chief executive Peter Long said in a statement.

The company increased its final divided by 17 percent to 9.75 pence per share, bringing the full-year payout to 13.5 pence per share, 15 percent higher than last year.

TUI, formed in 2007 through a merger between First Choice Holidays and the Thomson tourism unit of German group TUI, said growth in its higher margin "unique" holidays in the UK and Germany combined with rising online sales helped boost profits.

The new financial year had also started well, TUI said, adding that sales of winter vacations were in line with its expectations.

Rival UK travel firm Thomas Cook, recovering from a dramatic slump in sales over the last two years, also had a strong year posting a 49 percent leap in earnings for the year to September 30 in its results last month.

(Reuters)

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