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TUI sees summer travel demand ‘significantly’ lifting 2023 profit

by Staff GBAF Publications Ltd
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2023 05 10T061017Z 1 LYNXMPEJ4906Q RTROPTP 4 AIR BERLIN TUI

TUI sees summer travel demand ‘significantly’ lifting 2023 profit

By Joanna Plucinska

LONDON (Reuters) -German travel firm TUI said it expects strong revenue and higher profit in 2023 on the back of a jump in summer bookings, despite the risk of travel disruption triggered by strikes.

Airlines such as Lufthansa, easyJet and Ryanair have all pointed to robust summer bookings, showing consumers prioritising travel spend despite high inflation and an uncertain economic outlook.

Bookings for the summer have jumped 13% compared with the same period last year and reached 96% of bookings in the summer of 2019, the last summer before COVID-19 restrictions hit. Average prices for summer trips are up 5% over last year.

“It will be a strong summer and a good financial year 2023 with a significantly higher operating result,” CEO Sebastian Ebel said in a statement.

Many European carriers are wary of potential strikes, particularly by air traffic controllers in France, as they fear further delays akin to last summer, where much of the continent was impacted by travel disruptions.

TUI has invested a “double-digit million” amount to increase its resilience in the face of strikes, Ebel told a media call, with more focus put on standby aircrafts.

He added that “it’s annoying because our numbers would’ve been better” if the company hadn’t had to implement these costly measures.

The company’s shares were down around 3% at 0800 GMT.

TUI repaid state financial aid in full earlier this year and reported a narrower quarterly underlying earnings before interest and tax (EBIT) loss of 242 million euros ($266.39 million), up 88 million over last year.

With fewer people normally travelling in the first three months of the year, the results for TUI’s second financial quarter are usually expected to be weaker.

($1 = 0.9084 euros)

(Reporting by Joanna Plucinska, Editing by Sonali Paul and Elaine Hardcastle)