Business Express is an online portal that covers the latest developments in the world of business and finance. From startups and entrepreneurship to mergers and acquisitions, Business Express provides reporting on the stories that matter most to business leaders and decision-makers.The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
2024 02 13T091511Z 1 LYNXNPEK1C07N RTROPTP 4 TUI RESULTS scaled - Business Express

TUI swings to surprise first-quarter profit on robust travel demand

TUI swings to surprise first-quarter profit on robust travel demand

By Joanna Plucinska and Ilona Wissenbach

LONDON (Reuters) – Europe’s largest travel operator TUI on Tuesday reported far better-than-expected first quarter results as it swung to a profit on the back of robust travel demand, sending its shares 7.4% higher in early trading in Frankfurt.

The company reported an operating profit of 6 million euros ($6.46 million) versus a loss of 153 million in the year-earlier period and an LSEG forecast for a loss of 102 million euros.

Europe’s airlines are entering 2024 with robust outlooks as travel demand is expected to surpass pre-pandemic levels despite economic uncertainty, delays in plane deliveries from manufacturers and rising jet fuel prices.

TUI’s first-quarter beat is a positive signal for the airline sector as a whole, an investor in other airlines, who did not wish to be named, said.

“These updates highlight the strength of demand for holidays at present,” Dudley Shanley, an analyst at Goodbody, said in a note. “This summer should be very strong for… the European airlines.”

The first half of the fiscal year is usually weak with the bulk of annual profit coming from the main April to September summer season.

TUI shares in London were up by almost 4%. The company’s executive and supervisory boards recommended that shareholders vote to remove TUI from the London Stock Exchange at Tuesday’s annual general meeting to focus on the Frankfurt listing, in what would be a blow for the UK market.

Higher prices and bookings helped lift TUI’s earnings in the first quarter, with the company serving 3.5 million travellers, compared with 3.3 million travellers in the year-earlier quarter.

“People’s willingness to travel is still high, despite a market environment that remains challenging. We are thus creating the basis for TUI’s future profitable growth,” TUI Chief Executive Sebastian Ebel said in a statement.

Customer numbers are set to hit 20 million this year, reaching pre-pandemic levels, up from 19 million last year, Chief Financial Officer Mathias Kiep told a media call, adding later that second-quarter results are also expected to be stronger than last year.

Don't miss out on any breaking news or insightful opinions!
Subscribe to our free newsletter and stay updated on the go!

By submitting this form, you are consenting to receive marketing emails from: Global Banking & Finance Review. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email.

TUI maintained its outlook for a 25% increase in operating profit in the 2024 financial year which ends in September, and also set a medium-term target for a compound annual growth rate of 7%-10%.

Deliveries of Boeing MAX 737 10s are expected to be delayed but MAX 737 8 planes on order should arrive on time, CEO Ebel said on the call, adding that some leasing deals have been extended to ensure capacity.

TUI shares in Frankfurt have fallen 12% since the start of 2023.

On de-listing from the London Stock Exchange, the Hanover-headquartered company said having a single German listing could better reflect its ownership and trading patterns.

Three-quarters of shareholders at the annual general meeting need to vote in favour of the delisting to pass the motion.

TUI Travel’s dual London and Frankfurt listings resulted from the combination of Germany’s TUI with Britain’s First Choice Holidays in 2007.

($1 = 0.9289 euros)


(Reporting by Joanna Plucinska; Editing by Muralikumar Anantharaman, Sherry Jacob-Phillips, Kirsten Donovan and Susan Fenton)


Recent Post: