Tui Backs FY Earnings Outlook Amid Momentum in Summer Bookings
2022.09.20 05:29
© Reuters.
By Scott Kanowsky
Investing.com — Tui AG NA (LON:) reiterated its full-year earnings guidance despite lingering concerns that macroeconomic challenges may weigh on a recovery in travel demand.
In a trading update, the German tour operator backed its expectation that it will post “significant positive” annual underlying earnings before interest and taxes in its results for the twelve months ending September 30. It added that bookings during its key summer season were almost at pre-pandemic levels, as customers pursued higher value or longer holidays following the lifting of Covid-19 restrictions in some places.
Meanwhile, flight disruptions, especially in the U.K. in May and June, also improved throughout Tui’s fourth quarter, although they remain “elevated.”
But it flagged that a potential flare-up in the Covid crisis, as well as the conflict in Ukraine, may create headwinds to its near-term performance.
“The greatest area of uncertainty will be the impact on consumer confidence, should travel restrictions be reintroduced, should there be further cost inflation volatility and/or an escalation of the war,” the firm said.
Even still, Tui predicts that demand for its winter program will rebound to close to pre-Covid numbers. Bookings for the entire period currently stand at 78% of winter 2018/19 levels, while the months of November and December in particular are at 81%, according to the company.
London-listed shares in Tui were lower in mid-morning European trading, paring back early gains.
