TUI First Quarter Loss Widens but Expects Annual Profit at Top End of Guidance
TUI Travel, Europe's largest tour operator has reported a rise in its first quarter operating loss which is attributed mainly to the weakness of the euro.
However, TUI which operates the Thomson and First Choice brands said it expects the underlying operating profit for the fiscal 2013 to be of 7 to 10 percent, at the "top end of roadmap guidance".
TUI posted an underlying operating loss of £116m ($181.6m, €134.3m) in the final three months through December, a decline of 6 percent compared to £109m recorded for the same period previous year. Revenue for the first quarter fell 4 percent to £2.7bn.
However, the group reported increase in its holiday travel bookings with 4 percent rise in summer bookings and 2 percent increase in January bookings. This records a 7 percent rise from the same period last year.
TUI said the UK and the Nordic countries showed particularly encouraging growth for the company with the UK recording 9 percent rise in summer bookings.
"Our leading position in the UK has further benefited from increased market share as a result of higher demand for our unique holidays," said Peter Long, chief executive of TUI Travel.
"Across all our key markets demand for the overseas holiday remains strong, despite the overall economic environment".
Separately, rival Thomas Cook, the world's oldest travel group said its operating loss for the first quarter reduced to £ 69.8m, down 23 percent from the £91.1 m loss reported in the same period last year.
The 172-year-old group which was struggling over the last two years with slump in sales said it had reduced debt by £86m to £1.56bn and is expected to cut costs by further £60m this year.
Thomas Cook said its winter and summer bookings were in-line with expectations.
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