By Joanna Plucinska
LONDON, Feb 13 (Reuters) – TUI TUI1n.DE, Europe’s largest travel operator, on Tuesday reported better-than-expected numbers in the first quarter as it swung to a profit on the back of robust travel demand.
The company reported an operating profit of 6 million euros ($6.46 million) versus a loss of 153 million in the year-ago period.
TUI maintained its outlook for a 25% growth in operating profit in the 2024 financial year and also set a medium-term target for a compound annual growth rate of 7%-10%.
Europe’s airlines are entering 2024 with robust outlooks as travel demand is expected to surpass pre-pandemic levels despite economic uncertainty, delays in plane deliveries from manufacturers, and rising jet fuel prices.
The firm was expected to report a loss of 102 million euros in the first quarter, according to an LSEG analysis.
Higher prices and bookings helped lift TUI’s earnings in the reported period, with the company seeing 3.5 million travellers, compared with 3.3 million travellers for the same quarter last year.
“People’s willingness to travel is still high, despite a market environment that remains challenging. We are thus creating the basis for TUI’s future profitable growth,” TUI Chief Executive Sebastian Ebel said in a statement.
The first quarter is usually the weakest for airlines as bookings are lowest in the first three months of the year.
STOCK EXCHANGE DELISTING
The travel company’s executive and supervisory boards also recommended that shareholders vote to remove the company from the London Stock Exchange at Tuesday’s annual general meeting.
The Hanover-headquartered company said having a single German listing could better reflect its ownership and trading patterns, in what would be a blow for the UK market.
TUI Travel’s dual London and Frankfurt listings resulted from the combination of Germany’s TUI with Britain’s First Choice Holidays in 2007.
($1 = 0.9289 euros)
(Reporting by Joanna Plucinska; Editing by Muralikumar Anantharaman and Sherry Jacob-Phillips)
((Joanna.Plucinska@thomsonreuters.com; 00447721669853; Reuters Messaging: @joannaplucinska))