Late bookings flurry boost Tui profits 57%

Late bookings flurry boost Tui profits 57%

A surge in late booking by UK holidaymakers has helped profits of Tui Travel rise 57 percent to £102m in the quarter ending June.

Europe’s largest travel group cited receding fears of swine flu, including a flurry of last-minute bookings to Mexico, contributing to figures that remain on target for the financial year ending 30 September.

Tui resumed flights to Mexico in May, when UK government lifted its swine-flu travel advisory. Last month, bookings made from the UK to Mexico were 27 percent higher than the same time last year.

However revenues for the group fell 1 percent to £3.6bn due to the cutbacks in capacity. In the UK, holiday bookings are still down 12 percent over the past nine months, while in the Netherlands, bookings have fallen by 14 percent. France and the Nordic countries saw less dramatic falls of 10 percent, while in Germany bookings are down 9 percent.

Chief executive Peter Long said he expects this late booking trend to continue: “We are pleased with these results and remain well positioned to meet the Board’s expectations for the year ending 30 September 2009. Our UK Summer 2010 programme, which only launched recently, is trading well and we remain satisfied with our trading performance across all open seasons. Now, more than ever, customers are choosing to book their holidays with our high quality, trustworthy brands.
In the nine months to the end of June, pre-tax losses decreased by 40 percent to £411m on revenues that rose 2 per cent to £9bn.

ADVERTISEMENT

In some parts of Europe, there has been some seasonal pickup in the quarter compared to the previous quarter as holidaymakers booked summer vacations. Bookings from the UK are up 2 percent compared to the previous quarter and up 7 percent from Nordic countries.

But bookings in Germany and the Netherlands were both down 6 percent this summer compared with the previous Spring quarter.

The group sent a word of caution for the forthcoming winter season. It has already cut 15 percent of its capacity over fears that winter holidays are more discretionary than summer ones. In the UK, winter holiday bookings are down 21 percent year-on-year, although the group has managed to compensate for some of the decline in volumes by raising average prices by 9 percent.