First Choice offers fail to tempt

HOLIDAYMAKERS have not been persuaded by the seasonal glut of special discounts and free places to book their summer packages early, one of Britain's leading tour operators, First Choice Holidays, has said.

Cumulative summer mainstream bookings are 10% behind those at this time last year although sales have picked up significantly in the past three weeks.

To cope with the anticipated drop in demand following the terrorist attacks on the US, First Choice cut capacity for summer 2002 by 20% and winter break volumes by 15%. Winter bookings are 3% behind last year and increased insurance and security costs have depressed profit margins.

In specialist areas such as sailing and golf, which account for more than 40% of holidays offered, sales are down 7% compared with last year. North America is unsurprisingly the most difficult market, with numbers for the important winter season down by 40%.

However, chief executive Peter Long put an optimistic gloss on the figures produced for today's annual meeting. He said: 'What we've seen since 11 September is uncertainty, but confidence is beginning to recover.'

He believes people still want to fly off to the sun but are choosing to book closer to departure. 'We've got strong demand coming through for the summer and we are getting back to more normalised levels,' he said. Half-year losses are expected to be in line with forecasts at around £50m, up from £40m.