Tui Group reported growth as it shifts its focus to hotels and cruises
Tui Group, owner of Thomson and First Choice, reported its second year of strong performance after its merger in 2014.
Underlying earnings before interest, taxes and amortisation increased 12.5 per cent to €1.03m, (£875,541), while earnings for the world's biggest tourism operator's continuing operations – without Travelopia – increased 14.5 per cent.
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The German company's hotel brand earnings moved up to €287m from €235 last year. Seven new hotels were opened this year, and the end-goal is to open 40 to 45 new hotels by the next financial year.
The company's efforts to push cruises is doing well, particularly in the UK with its new Tui Discovery ship, with total earnings from cruises up to €130m from €81m.
Shares were up 2.35 per cent in morning trading.
Why it's interesting
The travel company ditched Hotelbeds Group in September and is in the process of dropping its specialist travel brand Travelopia to focus on growing its hotel and cruise brands because of their strong growth and margin potential, chief executive Fritz Joussen said.
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The UK performed well for the travel company, with four per cent more holidays booked this year, driven by Tui's unique holiday options, the company said.
Falling demand for holidays in Turkey and North Africa hurt the company. Terror attacks in Turkey cut demand in half and customer volumes fell overall as a result. Loss of interest in the two areas cost the company €50m.
Tui's outlook remains strong in the post-Brexit climate, and it expects to deliver at least 10 per cent growth in underlying earnings next year.
Read more: TUI must not get clouded by Brexit drama if it wants to woo holidaymakers
What Tui said
Joussen said the course is set for the company to grow further:
Tui is in good shape, the course is set for growth. We are in a strong position in Europe, continue our expansion, in particular in Mexico and the Caribbean, and seek to benefit from the growth momentum in other parts of the world, where more people are discovering leisure travel.