Tui cuts winter losses as year starts strongly

Tui cuts winter losses as year starts strongly

Tui has reported a strong start to the year with turnover increasing by 8.5% to €3.49 billion.

Underlying earnings before tax (EBITDA) in the three months from October to December rose by 17% to a loss of €66.7 million, an improvement on last year when losses for the period stood at €80.4 million.

Chief executive Fritz Joussen, said: “The transformation of our business as an integrated tourism business based on own hotel and cruise brands, initiated in 2014, is really paying off.

“This has been demonstrated by the very good performance delivered in the completed financial year and has been confirmed in Q1 2016/17.”

The results come after the group confirmed the sale of its specialist travel division, Travelopia, last night to private equity firm KKR for £325 million.

Joussen said: “Last night we successfully completed the sales process for Travelopia. The price was based on an enterprise value of 381 million euros and equals a multiple of 14.4 times underlying EBITA of the segment. This means that the transaction creates value.

“It also marks the next strategic step to further sharpen Tui’s profile as a vertically integrated tourism business. Tui is in an excellent state of health, and we are delivering on our promises.”

The UK helped drive a strong trading performance for the “northern region”, with passenger volumes up more than 10% year on year. Tui said this was been driven by long-haul and cruise with the launch of Tui Discovery in summer 2016.

The UK was said to be Tui’s most sold source market for summer 2017 on 43% while revenues were up 12% and bookings up 3%.

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