(Reuters) - Car rental company Dollar Thrifty Automotive Group posted a quarterly profit ahead of market expectations, helped by a recovery in the U.S. leisure travel market. The car rental industry, tied closely to airline traffic and hotel bookings, has seen demand strengthening in the past one year. Rival Avis Budget (CAR.O) forecast a strong 2012 last week, while another competitor Hertz (HTZ.N) raised its full-year outlook. Dollar Thrifty (DTG.N) -- the object of a prolonged takeover battle between Hertz and Avis until October -- on Wednesday reiterated its full-year outlook, which it raised late last month. "The recovery in the leisure travel market continues to show steady improvement, and as we head into the peak season we are pleased with the strength of our forward reservation bookings," Dollar Thrifty Chief Executive Scott Thompson said in a statement. The company expects strength in the used-car market to continue and travel volumes to improve in 2012. Dollar Thrifty's first-quarter net income rose to $40.4 million, or $1.35 per share, from $16.5 million, or 53 cents per share, a year ago. Hertz CEO Mark Frissora earlier this month said the company had made "substantial progress" towards obtaining antitrust clearance that would allow it to move forward on the Dollar Thrifty acquisition. Thompson declined to comment about this on a post-earnings conference call. Hertz said in October that it would make another bid for Dollar Thrifty if it received antitrust approval. Dollar Thrifty shares, which have risen 30 percent since Hertz put the acquisition bid on hold, were flat at $80.35 on Wednesday on the New York Stock Exchange. (Reporting by Sagarika Jaisinghani in Bangalore; Editing by Maju Samuel)

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