TUI, owner of Europe’s largest travel company TUI Travel, was yesterday optimistic for 2009/10 as recent bookings showed holiday-makers do not want to miss out on summer breaks.
“Bookings in the key source markets have improved notably in the past few weeks,” TUI said after impressing investors with a better-than-expected net loss for its fiscal first quarter and an improvement at its container shipping business, Hapag-Lloyd.
TUI Travel shares closed down 0.7 per cent at 262p in London yesterday.
The group expects a stable performance at its tourism business in the current fiscal year to September and a slight rise in underlying operating earnings from continuing operations thanks to cost cuts, it said.
TUI Travel -- which accounts for almost 90 per cent of TUI’s annual underlying operating revenues -- and its UK rival Thomas Cook both said last week that the worst was behind them. TUI Travel also said at the time that it had seen an improvement in trading in its fiscal second quarter.
Such comments echo data released last month showing that economic sentiment in the eurozone strengthened much more than expected in December and January while German unemployment rose less than forecast in January. But in the three months to the end of December, TUI’s fiscal first quarter, the travel group still felt the pinch as holiday-makers cut back on spending amid growing concern about job prospects.
TUI’s first-quarter underlying loss before interest, tax and amortisation widened to €137.7m (£120m) from a loss of €98.4m in the same period a year earlier. Its net loss after minority interests narrowed 34 per cent to €102.8m.
Hapag-Lloyd, in which TUI still holds 43 per cent, reported a wider underlying operating loss of €21m year-on-year. But the result improved by €19m compared to the previous quarter, TUI said.
City A.M. Reporter