TUI Travel , the world's biggest tour operator, reported a better-than-expected full-year profit, boosted by strong online sales and demand for exclusive resorts and offering a stark contrast to struggling rival Thomas Cook .

The group, which takes 30 million people on holiday each year, said Monday operating profit for the year to September rose 18 percent to a record 471 million pounds. The average forecast had stood at 461 million, according to a Thomson Reuters I/B/E/S poll.

We have delivered another year of profit growth, against a backdrop of unrest in key North African destinations and weak consumer sentiment in some source markets, Chief Executive Peter Long said. Even in the current challenging market conditions, we continue to operate from a position of strength.

TUI Travel, which operates Thomson and First Choice, said it had managed to grow sales and profit in Britain, while its main competitor foundered, because of its greater online presence and the high proportion of differentiated product that cannot be bought from other travel firms.

The group has focused on brands such as Holiday Village and Thomson Couples which offer holidays to exclusive resorts like Sensatori. It has also benefited from appealing to a broader demographic of customer than Thomas Cook -- whose core customer base of young families has suffered most through the downturn.

The results reflect the strategy of an astute management team operating in exceptionally challenging conditions, a strategy sharply at odds with the inept approach of their opposite numbers at Thomas Cook, said Richard Curr, head of dealing at Prime Markets.

Thomas Cook has endured a torrid 2011, issuing a string of profit warnings, and faces an uncertain future as it battles to regain the confidence of holidaymakers and investors after securing a rescue package from its lenders.

Long said TUI Travel had seen an upturn in bookings in the past fortnight since Thomas Cook said it would need to ask its lenders for help for the second time in five weeks.

We've seen an improved volume of business. If people aren't booking with Thomas Cook, then we would be the natural place for them to migrate to, Long told reporters on a conference call.

However, Long added it was too early to say whether the upturn in trading was a long-term trend, pointing out that the comparative period last year was affected by snow.

TUI Travel, which is majority-owned by Germany's TUI AG , has looked to cash in on its rival's misfortune, placing advertisements in national newspapers stating: Another holiday company may be experiencing turbulence, but we're in really great shape.

RBS said it expected the group to benefit from Thomas Cook's distress in the critical post-Christmas trading period when the majority of customers book their holidays.

We expect TUI Travel to benefit from any fall-out as being the most trusted alternative brand and we further expect TUI Travel to continue with its aggressive marketing campaign, it said in a research note.

TUI Travel said it was embarking on self help measures to help offset the tough economic environment. Those measures include cost savings of 107 million pounds over three years.

TUI Travel shares, which have gained 29 percent over the last two weeks, were up 0.2 percent to 169.9 pence at 1210 GMT.

(Reporting by Matt Scuffham; Editing by Helen Massy-Beresford and Mark Potter)