So far, TUI boss Sebastian Ebel has counted around 8.3 million bookings for the most important holiday months, which is only four percent fewer than at the same time in 2019. The manager wanted the presentation to show whether the summer would ultimately be a little weaker or a little better than it was then of the quarterly figures on Wednesday but not predict. He also did not dare to make a more precise profit forecast for the current financial year.
The news was received negatively on the stock exchange: the TUI share ultimately lost 5.08 percent to EUR 6.13 in Frankfurt via XETRA. In the past few months, their course had come under the wheels – also as a result of a billion-dollar capital increase, with the help of which the group recently repaid the last state aid from the State Economic Stabilization Fund (WSF). The WSF and the state bank KfW saved TUI from going under with a total of 4.3 billion euros during the Corona crisis.
TUI is now heading for much better times again. In view of the large number of bookings for the summer, Ebel sees the group on course to “significantly” increase operating profit adjusted for special items (adjusted EBIT) in the current financial year by the end of September.
After billions in losses during the Corona crisis, TUI had again achieved an operating profit of 409 million euros in the past financial year. But that was still significantly less than before the pandemic: In the 2018/19 financial year, the company would have earned around 1.2 billion euros in day-to-day business without the burden of the then flight ban for the Boeing jets (Boeing) of the type 737 Max. TUI management wants to build on this level again in the coming years.
In any case, for the summer of 2023, Ebel assumes that the group will be able to at least compensate for the costs that have increased with inflation through higher travel prices. Because customers are once again digging deeper into their pockets for their holidays. According to the information, the average price of TUI trips sold for the summer is 5 percent higher than in the previous year. Compared to the summer of 2019, people spend an average of 26 percent more.
Nevertheless, more customers decide to vacation with TTUIui. Most recently, the number of summer bookings was 13 percent higher than a year ago, reaching 96 percent of the 2019 level, with around 55 percent of the offer sold. In Great Britain, TUI even had 10 percent more customers than before the pandemic. At that time, however, the group also had a major competitor: the British tour operator Thomas Cook with brands such as Neckerman Reisen filed for bankruptcy at the end of September 2019.
TUI did not benefit as much from the rival’s bankruptcy as other providers, Ebel admitted on Wednesday. “That annoys us,” he said in a video conference with journalists. He wants to change that in the coming financial year and increase the number of flights in Great Britain by 1.1 million seats. In addition, as in other countries, TUI will increasingly rely on the daily purchase of flight tickets, hotel beds and other travel components directly from the providers. This is intended to further expand the group’s range and enable additional combinations.
According to Ebel, TUI has armed itself against impending bottlenecks and cancellations in air traffic in the most important travel season in the upcoming summer. “We have taken absolute precautions, unlike in previous years.” The group always has 12 to 13 aircraft on standby. In addition, the company has already received all the new aircraft that are planned for the summer. According to Ebel, the recent problems of the manufacturer Boeing with the delivery of new jets of the type 737 Max do not affect TUI.
In the second business quarter up to the end of March, TUI continued to recover from the corona pandemic in day-to-day business. Compared to the same period of the previous year, sales increased by around half to around 3.2 billion euros. The seasonal operating loss before special effects (adjusted EBIT) fell by a good quarter to around 242 million euros. The net loss attributable to the shareholders increased by almost nine percent to 364 million euros, also due to a lower tax credit.
In April, TUI repaid the last state aid to the WSF with the help of a capital increase. Of the aid funds from the pandemic, the group only retained a credit line of 1.1 billion euros with KfW, but is currently not using it. If these measures are included, net debt recently fell to 3.1 billion euros. The group hopes that this will result in a significantly lower interest burden.
However, these steps have not helped the price of the TUI share so far. CFO Mathias Kiep was expressly “not satisfied”. After all, the investors put 1.8 billion euros in fresh money into the company during the capital increase and now expect this money to earn interest. Instead, the price of the TUI share fell so far in the weeks after the start of the capital increase that the entire group on the stock exchange is worth 3.2 billion euros, despite the recent injection of billions, as much or less as before.
HANNOVER (dpa-AFX)
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