Tui posts strong Q1, maps out future

Operator giant to expand into new source markets
Tui Group has reduced its seasonal loss in its financial results for the first quarter. The group delivered a growth in turnover in the period, with the seasonal Q1 loss reduced year-on-year.
Including the impact of foreign exchange translation, underlying EBITA (earnings before interest, taxes and amortisation) rose 25% to €–60.3 million. Tui Group’s turnover climbed 8.5% to €3.49 billion.
Fritz Joussen, chief executive, emphasised the group’s strength “despite a challenging market environment in some destinations”.
He said: “A broad portfolio of group-owned hotel and cruise companies, aircraft and tour operators are gathered under the group umbrella and we operate in more than 100 countries around the globe.
“This gives us great flexibility and enables us to quickly remix our programme if our customers’ travel preferences change.
“The transformation of our business as an integrated tourism business based on own hotel and cruise brands, initiated in 2014, is really paying off.”
The group completed on Monday the sales process for its specialist division Travelopia. The price was based on an ‘enterprise value’ of €381 million.
Tui’s Q1 growth was driven by long-haul and cruise. However, the Nordics continue to operate in a challenging market environment, the group said, with lower demand for Turkey and North Africa.
Meanwhile, Tui Group underlined its intention to reposition its brand, while expanding into new source markets including countries in southern Europe and Southeast Asia, China and India.
In a conference call, Joussen said that while the group had been transforming from predominantly a tour operator to a “vertically integrated business” it had been considering which markets it could enter afresh.
“We must enter them in a different way to our other source markets,” Joussen said. “We will enter them fully digitally and we have a plan to achieve one million customers by 2022.”
TTG Digital