Summer 2010

We remain pleased with trading in the UK for the Summer 2010 programme, with bookings down 3%. We are currently planning for flat capacity for the season. The load factor is flat versus the prior year at 20% and the average selling price of packages is now up 7%, although this partly reflects the shift in destination mix away from short haul and the product mix shift towards differentiated product.

Initial trading in the Nordics market for Summer 2010 has also been encouraging, with load factors flat at 15% and average selling prices up 3%.

Fuel/foreign exchange

We have hedged a significant proportion of our fuel and foreign exchange exposure for 2010 in line with our hedging policy.

Higher fuel prices resulted in $125m of extra costs in Summer 2009 versus Summer 2008. Based on achieved hedged rates and current forward rates, the effective fuel rate for Summer 2010 is currently 20% lower in local currency terms. For most of our Continental European businesses this, coupled with lower accommodation cost rates, allows them to reduce prices significantly whilst maintaining margins. In the UK source market, however, the strength of the Euro (+10% year-on-year) offsets the fuel rate savings.

Integration

The merger integration continues to progress well and we are on track to deliver our £200m synergy target. We have delivered £120m of benefit to date and expect to deliver a further £60m in 2010.