Travel firm TUI confident on outlook as bookings rise

TUI Group, the world's largest leisure tourism firm, said bookings were up on last year, as European demand for holidays continued despite increased security threats, putting it on track to grow annual earnings by over 10 per cent.

Security worries have forced holiday companies like TUI to cancel trips to some destinations this year. In November, Britain suspended flights to Egyptian resort Sharm al-Sheikh, while trips to Tunisia were cancelled earlier in the year after the death of 38 holidaymakers in a massacre on a beach in June.

The threat was further intensified by the attacks on Paris which killed 130 people on November 13th.

TUI said that for its summer 2016 programme, it had seen a good start to trading, with bookings from Britain up 11 per cent, giving it confidence in its target to grow core earnings (EBITA) by at least 10 per cent on a constant currency basis in the current financial year.

For the 12 months ended September 30th, it reported underlying core earnings of €1 billion on a constant currency basis, 15.4 per cent higher than last year, beating the top-end of its own guidance for a rise of between 12.5 per cent and 15 per cent.

The positive outlook from Germany-headquartered TUI, reflected forecasts from smaller rival, Britain’s Thomas Cook , which said in November that demand for its holidays was ahead of last year.

TUI, formed last December through the merger of London-listed TUI Travel and German majority owner TUI AG, also said it would raise its dividend per share to 56 cent from 33 cent.

Reuters