Its performance was boosted by the strong pound, which has had the effect of making foreign holidays abroad cheaper and led more Britons than ever to take pack their bags and head overseas.

A record 12.6m people in total travelled overseas during the summer months this year.

Holiday resorts have been packed with British tourists

Airtours also signalled it is in the hunt for more acquisitions in a rapidly consolidating tour market, by announcing plans to borrow £250m by issuing new bonds on the financial markets.

"There are lots of opportunities being thrown up by the globalisation and consolidation of this industry," chairman David Crossland said.

Airtours, along with its main rivals, has rushed to buy smaller tour operators.

There has been speculation that Airtours is interested in acquiring France's largest package tour operator, Nouvelles Frontieres.

Airtour's profits rose by 17% to £140.3m from £120.3m last time, on sales of £3.05bn, at the higher end of analysts' expectations.

The company is planning to raise the final dividend to 7.5p from 6.67p.

"In our businesses last year we've had a very strong year, particularly strong in the UK," the company said.

Booking profits

Airtours says that prospects continue to be good for next year, with winter bookings up 6% and summer bookings up 5%. Scandinavian winter bookings were particularly strong.

Airtours has already announced it its reducing the number of holidays it has on offer next year to avoid getting caught out be a possible fall in demand if there is a UK recession.

The strong results boosted other shares in the travel industry, with First Choice rising by 7p to 104p, and Thomson Travel up 1p at 156.5p.

But Airtours shares were down 36p, to 400p on profit-taking.

Wide range of tours

Airtours runs a wide range of all-inclusive holidays from the UK. It has a chain of 700 travel agents, under the Going Places brand, three cruise ships, and an airline with ten Airbus A320s, six Boeing 757s, and three Boeing 767s.

Airtous has also been expanding abroad, buying up tour operators in Canada and Scandinavia. Almost half of its bookings now come from overseas.

It spent over £200m on acquisitions last year, including the purchase of a leading Internet holiday booking service, Direct Holidays.

Carnival Corporation, a US cruise operator, has a 29% stake in the company.