TUI Travel reports major losses

  TUI Travel has reported a record £333 million half-year loss after figures were hit by the weak pound and Easter falling in the second half of its trading year. The deficit for the First Choice and Thomson holidays firm was 13% wider than 2008, although it did see first-half revenues improve 4% to £5.38 billion.The firm said that results were hit by a 30 million pounds currency translation impact resulting from the devaluation of sterling, socio-political events in the French West Indies and Madagascar, weaker demand in Canada, and the timing of Easter. Revenue rose to 5.4 billion pounds, from 5.2 billion pounds. Tui Travel noted that, despite economic weakness, it’s encouraged by current trading patterns and is well positioned to meet fiscal-year expectations.

Trading for summer 2009 has continued to strengthen with cumulative bookings for the summer season in line with anticipated demand and capacity cuts across all key markets; fewer holidays left to sell across all regions due to capacity reduction.

Strategic co-operation between TUIfly and Air Berlin announced in March; secures optimal capacity for our German tour operating business and delivers substantial financial benefit.

Peter Long, chief executive officer of TUI Travel PLC, commented: “TUI Travel has delivered a first half performance in line with our expectations, having managed certain source market and destination specific issues, while continuing to deliver our key strategic goals and synergy targets. In addition, during the first half we agreed the joint venture in Russia and Ukraine and the strategic co-operation between TUIfly and Air Berlin. Despite the ongoing economic weakness, we are encouraged by current trading patterns and consumer sentiment across the breadth of the group. This confidence coupled with our strong brands, market leading positions and our flexible business model means we remain well positioned to meet our expectations for the year to 30 September 2009.”
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