SHARES in Thomas Cook, the holidays group that owns Direct Holidays in Scotland, soared as much as 15% after the troubled company showed signs that it is retaining its customers.

Disputing claims from bigger rival TUI Travel that it had benefited from the com-pany's recent financial woes, Thomas Cook, which has some 70 stores in Scotland includ- ing its Going Places and Co-operative Travel brands, said it is holding on to market share.

Chief executive Sam Weihagen said: "I have been encouraged by how our bookings have developed, particularly in the UK where our market share for both the winter and summer seasons remains broadly stable."

While winter bookings in the UK are down 4% so far, summer bookings are just 1% lower than last year.

Mr Weihagen said that the first quarter of the year has been hit by the "uncertain economic environment across Europe", rising costs and political upheaval in the Middle East and North Africa.

Shares in the company, which had fallen by around 90% in the last year, climbed as much as 15% before closing up 0.75p, or 5.8%, at 13.75p.

TUI Travel, which owns Thomson and First Choice, had said earlier this week that it significantly outperformed rivals in Britain during January, highlighting the uncertainty surrounding Thomas Cook.

However, Mr Weihagen said that TUI Travel had ramped up promotional activity in early 2012. He said that for summer 2012 as a whole, Thomas Cook had sold 42% of its holidays compared with TUI's 35%.

As expected by the City, Thomas Cook saw operating losses more than double to £91.1 million for the last three months of 2011, which is typically a loss-making season for tour operators. Revenue was up 3% to £1.9 billion.

Thomas Cook, Europe's second-biggest travel firm by sales, also said it planned to sell its 77% stake in Thomas Cook India as it looks to bring down its £890m debt load.

Analysts think a sale could raise around £150m.

Thomas Cook's future has been in question since it asked lenders to come to its rescue.

Thomas Cook issued three profit warnings last year, culminating in the departure of chief executive Manny Fontenla-Novoa in August.

The group's decision to pay former boss Mr Fontenla-Novoa a £1.2m severance package was criticised by shareholders at Thomas Cook's annual meeting yesterday.

However, independent non-executive director Peter Middleton said the company acted within the law and was in a "legally binding contract" with Mr Fontenla-Novoa.

Conditions have been un-favourable for holiday firms as the key customer base of families with children have seen their spending power eroded by the economic slump and state spending cuts.

This has been further exacerbated by the Arab Spring uprisings in key holiday destinations such as Egypt, Morocco and Tunisia.

Direct Holidays was acquired by Airtours from Scottish businessmen John and Hugh Boyle in 1998 for £81m. Airtours, then owned by MyTravel, later became part of Thomas Cook.