TUI reports a huge shift away from Turkey
TUI has reported holidaymakers shifting away from Turkey as a destination with Summer 2016 bookings down by 40%.
At its first quarter results ending December 31, the travel giant said it had been able to act quickly to add capacity to other destinations such as Spain and the Canaries.
Overall TUI group reported a reduced loss of €102m compared to €105m the previous year – a 7.2% improvement in earnings before interest, tax and amortization (EBITA).
This, it said, was despite the impact of what it described as ‘geopolitical events’ and was in line with expectations.
For Summer 2016, UK bookings performance is strong, up 9%, despite demand for Turkey being down.
While 41% of the programme has been sold in the UK, average prices are down 1%.
For Winter 2015/16, UK bookings were up 3% and average selling prices were up 1% with lower jet fuel costs and the impact of the weaker Euro on accommodation costs partly offsetting the increase in long haul.
It said 76% of its UK winter programme had been sold. Long haul bookings are up 16% with growth in demand for Mexico, Dominican Republic and Jamaica as well as the addition of Costa Rica.
It added that short/medium haul was still 1% up despite lower demand for Egypt due to the operator remixing its programme to offer alternatives.
TUI said in the Nordics bookings are flat and in Germany bookings are down 3%.
Chief executive of TUI Group, Friedrich Joussen, said: "It is evident that there has been a significant shift in demand away from Turkey, with Summer 2016 bookings to that destination currently down around 40%. Our scale business model and own hotel content means that we have been able to act quickly to remix capacity to alternative, profitable destinations.
"In addition, our own hotels in destinations outside Turkey (such as Spain and the Canaries) are benefitting from the shift in demand. Based on current trading, and the resilience of our integrated business model, we continue to expect to deliver underlying EBITA growth of at least 10% in 2015/161.
"We are continuing to deliver our merger synergies as planned, with a further €10m realised in the quarter, and the disposal process for Hotelbeds remains on track."
Diane
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