TUI Group's confidence on profit lifts shares

(Adds share price, analyst comment)

LONDON, March 25 (Reuters) - TUI Group, the world's largest leisure tourism group, said it was confident of growing underlying operating profit by between 10 and 15 percent this year thanks to higher holiday sales and prices.

The company, formed in December from the merger of London-listed TUI Travel and German majority owner TUI AG (LSE: TUI.L - news) , also said on Wednesday that it expected its underlying first half result this year to exceed last year's figure.

Shares (Berlin: DI6.BE - news) in the company rose 3.9 percent to 1,229 pence at 1012 GMT, the strongest performance in Britain's bluechip index , reaching their highest level since the merger was completed.

Analysts said TUI's announcement that it would from next month redeem two convertible bonds and cancel and repay a 300 million euro hybrid bond, was also boosting the stock.

Shore Capital analyst Greg Johnson said the repayment of the hybrid bond would boost earnings and came earlier than expected.

TUI said holiday sales for its winter season rose 1 percent while holiday prices for the coming summer were also 1 percent higher, with summer bookings also up 1 percent.

Its main competitor, Britain's Thomas Cook (Xetra: A0MR3W - news) , which earlier this month announced China's Fosun as a new investor, will provide its next update on Tuesday. It warned in February that average summer holiday prices were flat to 1 percent lower.

TUI is due to publish its first-half results on May 13, when it will also give further details on the strategy of the newly enlarged company. (Reporting by Sarah Young; Editing by Keith Weir)