Thursday lunchtime business bulletin

May 15 2008 By Andrew Mernin

Travel giant Thomas Cook today reported "robust" demand despite the economic gloom as travellers clung to their prized foreign holidays.

The company saw strong summer trading and ``encouraging" early sales for next winter as it remained on track to meet expectations this year.

The firm has also trimmed its capacity - meaning it has fewer holidays to sell in the heavily-discounted ``lates" market - which helped boost average UK prices by 3%.

It said: "We have not seen any effect on our trading to date from the current economic conditions.

``We continue to believe this can be primarily attributed to the high priority that European consumers place on their major foreign holidays, and our ability to proactively manage the balance between supply and demand."

Bookmaker Paddy Power today said a host of sporting upsets had cost punters but left the firm on course for forecast-beating profits this year.

The company gained from favourable racing results including Comply or Die’s Grand National win as well as an FA Cup competition strewn with giant-killings.

Paddy Power also banked big gains from favourite Tiger Woods’ second place at the US Masters golf tournament to 130-1 outsider Trevor Immelman in April.

The healthy start to the year will leave 2008 operating profits around 14% higher at 82 million euros (£65.3m) and 8% higher than market hopes, the company said.

The forecast comes despite the pound’s weakness against the euro hitting operating profits by 5 million euros (£4m) if exchange rates remain at current levels for the rest of the year.

Dairy Milk maker Cadbury today said higher prices left it on course to beat targets for the first six months of the year.

The group, which rebranded from Cadbury Schweppes earlier this month after spinning off its drinks arm, has been upping its prices to combat soaring commodity costs this year.

Cadbury - the world’s second largest confectionery firm - said interim revenues growth was on track to be above management goals of between 4% to 6%. Cadbury shares rose 5% as investors cheered the upbeat performance so far in its first half.

The group has sought to push through higher prices to combat 5% to 6% rises in commodity costs, but to the detriment of its market share.

The pound at noon was US$1.9438 compared to US$1.9446 at the previous close while the euro at noon was £0.7971  compared to £0.7954 at the previous close.