Holiday company TUI says surge in bookings in Germany is leading to recovery
- TUI posts positive cash flow of 320 million euros in the third quarter
- Q3 adjusted EBIT loss of € 670 million
- Summer bookings of 4.2 million vs. typical summer of 9 million
- Stocks increase by 1%
LONDON, Aug.12 (Reuters) – Vacation company TUI Group (TUIGn.DE) said on Thursday that an increase in bookings from Germany had led to a recovery from the pandemic crisis and an easing of travel restrictions in Great Britain would give a new impetus.
The Germany-based company said bookings had jumped 1.5 million since May, and in total it had 4.2 million bookings for this summer, up from around 9 million in a typical summer, contributing to ease the strain on finances that have been strained by COVID. -19 crisis.
“We are adding bookings every day,” managing director Fritz Joussen told reporters.
The slower-than-expected reopening of trips to Britain dragged on TUI during its April-June quarter, but Joussen said UK bookings were increasing after the government lifted the quarantine for people fully vaccinated to most vacation destinations by mid-July.
The slower opening in the United Kingdom, however, forced the group to reduce its summer capacity to 60% of its 2019 program, against 75% expected in May.
London-listed TUI shares rose 1% to 336 pence in mid-morning trades, matching earlier gains of 3%.
Bookings from Germany and the rest of continental Europe helped TUI generate positive cash flow in April-June, for the first time since the start of the pandemic, with a cash inflow of 320 million. euros ($ 375.78 million).
“The good thing is that the liquidity is depleted, we are not burning any more money,” Joussen said, adding that profitability would be “reasonably good in the summer” and that bookings for 2022 were very strong.
TUI has taken out loans of more than € 4 billion and has been bailed out on several occasions by the German government after the pandemic forced it to stop taking vacations last year.
Joussen reiterated that the company would consider raising capital to help pay off the debt at some point. In July, its banks agreed to extend its two-year credit lines until 2024.
For its third quarter, TUI recorded an adjusted loss before interest and taxes of 670 million euros on sales of 650 million euros.
($ 1 = 0.8524 euros)
Reporting by Sarah Young, additional reporting by Ilona Wissenbach in Frankfurt; Editing by Kate Holton, Mark Potter and Barbara Lewis
Our Standards: Thomson Reuters Trust Principles.