TUI reported its revenues overtook pre-pandemic levels in its half year results this morning, as it cashed in on increased bookings and a boom in summer travel demand.
The travel company reported revenues of £2.78bn (€3.2bn), a £870m (€1.bn) improvement on the previous year, with bookings hitting 12.9m across the winter and summer seasons.
Losses shrunk by £180.75 (€208.2m) on the previous year, at £343.17m (€395.3m.)
Sebastian Ebel, chief executive of Tui, said “Strong booking development and significantly improved quarterly figures underline our expectations: it will be a strong Summer and a good financial year 2023 with a significantly higher operating result.”
The popular tour operator said that capacity was returning to pre-pandemic levels, with the agency “confident” it would close in on 2019 figures this summer.
This comes after TUI announced the era of ultra cheap flights was ‘over’, as reported in the Times, as Ebel said airlines would no longer offer tickets under 50 Euros simply to fill flights.
Its share price dropped by 3.7 per cent this morning to -20.80.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown said that despite the positives, the results had not done enough to “plug the biggest hole,” as liquidity risk remains “at the forefront of investors’ minds.”
“The airline sector is one marred by consolidation during tough times too, and weaker links are at more risk of facing difficulty.”
She added: “It also seems that summer bookings are off to a flying start, and the huge cache of state aid taken on during Covid has been paid down thanks to a recent rights issue.”
Bookings for the summer season were up up by 13 per cent year-on-year, at 96 per cent of of pre-pandemic levels, with holidaymakers choosing Spain, Greece and Turkey as the most popular destinations.
The winter season also a rise in reservations, up 133 per cent on the previous season and 88 per cent of Winter 2019 levels, with Egypt and Cape Verde the most popular destinations.
The half-year results follow a turbulent few years for the travel firm, which saw covid-19 hit revenues, followed by a downturn in business as a result of the cost of living crisis.
EU sanctions as a result of the war in Ukraine also forced the resignation of its majority shareholder, Russian billionaire Alexi Mordashev, in March 2022.
The travel firm now looks benefit from a recent uptick in summer travel demand, which has seen airlines such as Easyjet and Jet2 report bumper profits this quarter.