Tui losses shrink to £525m as holiday giant hails strong demand for summer breaks and eyes return to profits
- The latest quarter was ‘significantly improved’ with Covid rules easing
- It told shareholders it could return to profit by the end of the year as a result
- In terms of sectors, cruises is set to be the slowest area to recover
Holiday giant Tui more than halved losses over the past six months compared to 2021 levels, as it hailed a strong recovery in customer demand for the summer.
The company, headquartered in Hanover, Germany, reported an earnings loss of £525million for the half-year to 31 March, following a £1.1billion loss for the same period a year earlier.
It told shareholders on Wednesday it could return to profit by the end of the year as a result.
Holiday giant Tui has more than halved its losses for the past six months as it hailed a strong recovery in customer demand for the summer
Tui said it expects a ‘strong’ summer and has already achieved 85 per cent of the booking levels seen in summer 2019, before it felt the heavy impact of the pandemic.
The latest quarter was ‘significantly improved’, Tui added, as the easing of pandemic restrictions helped boost bookings.
The travel group said its UK operation ‘continues to lead the way’ for summer bookings, which currently show an 11 per cent increase against the levels seen in summer 2019.
It expects overall bookings for the summer to ‘almost reach’ levels from 2019.
In terms of sectors, cruises are set to be the slowest area of the business to recover.
However, Tui noted that since the beginning of April all 16 ships across its three cruise brands, which comprise Mein Schiff, Hapag-Lloyd Cruises, and Marella Cruises, are back in operation, with bookings currently ‘trending at higher rates… in comparison to previous years’.
Overall, Tui has been buoyed by holidaymakers booking ‘more at short notice’ and also spending more money on each trip.
Meanwhile, revenues for the past half-year increased more than five-fold to £3.8billion against the same period a year earlier, when the firm was still struggling with Covid-19 restrictions.
Commenting on the results Tui chief executive officer Fritz Joussen said: ‘The high demand for travel and the very good business performance confirm our forecasts.
‘2022 will be a good financial year. Capacity almost reaches pre-corona level of 2019.
‘After two years of crisis, we expect Tui to become profitable again in the current financial year with a significantly positive underlying EBIT (earnings before interest and tax).
‘This is the basis for new growth.’