'Early signs' of recovery
Holidaymakers are beginning to return to Turkey and Egypt after terrorist attacks and political unrest hit demand, says travel firm Thomas Cook.
The group said while bookings to the destinations are still lower, it was seeing "early signs" of a recovery.
Thomas Cook added that the wider holiday market was also enjoying a bounce back after a difficult 2016, with summer bookings overall up 10pc as sun-seekers have shifted to Greece and other European destinations including Cyprus, Bulgaria, Croatia and Portugal.
Demand for trips to Turkey and Egypt plunged after the 2015 bombing of a plane from the Egyptian resort of Sharm el-Sheikh, and a violent attempted coup by the Turkish army, which has been followed by a string of terrorist attacks in the country.
But Thomas Cook has switched its focus to other resorts, such as Greece, which is now seeing bookings up by 40pc year-on-year.
Peter Fankhauser, chief executive of Thomas Cook, said:
"Customers' appetite to go abroad on holiday this summer is good across all our markets despite continued political and economic uncertainty."
He added: "After a slow start to the season and a tough year in 2016, we're seeing early signs that customers are beginning to go back to Turkey and Egypt."
Thomas Cook said competition remained intense for the Spanish Island markets, which has sparked a price war among airlines, although it added that demand to these resorts had "levelled off".
The group has had to hike the prices of package holiday deals by 5pc after hoteliers in Spanish islands upped prices by around 6pc to 8pc as travellers turned to the destinations as an alternative to Turkey and Greece.
Overall package holiday average selling prices are 9pc higher.
But flight-only prices have fallen due to competition, which has left average selling prices 3pc higher for the UK business as a whole, added Thomas Cook.
It said: "While we are seeing some margin pressure in parts of our business due to more competition, overall demand for our summer holidays is strong."
Shares in the group fell 2pc despite Thomas Cook assuring that trading remained on track with City expectations for the full year.