In a trading update, Ebookers said it remained cautious about the April to June quarter, which is traditionally a weaker period.

But it said it expected a strong performance for the rest of the year.

Earlier this month the firm reported its first quarterly profit for the January to March period.

Positive outlook

The past few months has seen the travel industry hit by the effects of the war in Iraq and the spread of the deadly Sars virus.

We are very encouraged by the rebound in the market Dinesh Dhamija, Ebookers chief executive

Ebookers said some of its businesses had been affected by these factors, but that bookings had been growing since late April and the trend was in line with expectations.

It also said that the integration of the Travelbag business - which Ebookers bought for �55m earlier this year - was continuing on schedule.

"Overall we are very encouraged by the rebound in the market," said chief executive Dinesh Dhamija.

"(We) expect a strong performance for the remainder of the year and in the future in the rapidly expanding European online travel market."