* Q3 adj EPS C$0.70 vs est C$0.22
* Q3 rev C$867.3 mln vs est C$845.5 mln
* Sees rise in Q4 rev, margins
* Shares up as much as 7 pct (Recasts; adds analysts comments, share movement)
BANGALORE, Sept 9 (Reuters) - Canada's Transat AT Inc TRZa.TO TRZb.TO said a rise in travel to Europe and higher pricing helped strong third-quarter results and will boost revenue and margins in the current quarter, sending the tour operator's shares up as much as 7 percent.
The Canadian company's outlook is in stark contrast to comments from European tour operators Thomas Cook (TCG.L) and TUI Travel TT.L, both of whom issued profit warnings last month as Britons cut back on vacation spending.
"International tourism remains resilient, people continue to show an inclination to travel," Transat co-founder and Chief Executive Jean-Marc Eustache said in a statement.
The company, which operates Air Transat airlines, said fourth-quarter bookings and average revenue per booking are higher in Canada and Europe, while capacity is expected to be about 15 percent higher.
"We see the solid bookings and pricing on Canada-Europe market as positive since they point to strong fourth-quarter results," BMO Capital Markets analyst Claude Proulx wrote in a note to clients.
Pricing in all transatlantic markets are now above last year even after converting tickets sold in euros and pounds into Canadian dollars, said Proulx, who maintained his "outperform" rating on the company's stock.
According to Thomson Reuters I/B/E/S, analysts were expecting revenue to rise about 4 percent in the quarter for the Montreal-based company, which also operates in the Caribbean and Mexico.
However, while the transatlantic market remains strong, the weak sun-holiday market is expected to roll over into the quarter with intense competition pressuring selling prices.
While quarterly bookings and load factors in the market are slightly higher, capacity remains unchanged, Transat said.
Transat, which competes with WestJet Airlines' (WJA.TO) WestJet Vacations, Air Canada's ACb.TO Air Canada Vacations and Sunwing Vacations, said margins in the market were lower in the third quarter as cost cuts only partly offset a fall in prices.
Third-quarter net income fell to C$20.9 million ($20.17 million), or 55 Canadian cents a share, from C$31.0 million, or 94 Canadian cents a share, a year ago.
On an adjusted basis, the company's earnings of 70 Canadian cents a share handsomely beat analysts' expectations of 22 Canadian cents a share.
Revenue rose 6 percent to C$867.3 million, ahead of estimates of C$845.5 million.
The company's Class B shares, which have gained about 41 percent since their year-low in May, were up 4 percent at C$14.20 in afternoon trade Thursday on the Toronto Stock Exchange. They earlier touched a high of C$14.60. ($1=1.036 Canadian Dollar) (Reporting by Bhaswati Mukhopadhyay and Isheeta Sanghi in Bangalore; Editing by Anne Pallivathuckal)