By Joanna Plucinska
LONDON (Reuters) -Holiday group TUI said on Tuesday it was seeing a positive travel recovery trend for the upcoming summer season as holidaymakers make plans to enjoy their breaks following a pandemic hiatus.
Many feared recessionary pressures could dampen demand for holidays, but results for airlines such as Ryanair, Wizz Air and easyJet showed promising momentum and indicate that consumers are gearing up for their holidays.
TUI, one of the world’s largest tour operators, said the number of guests in the first quarter was 3.3 million, compared with 2.3 million in fiscal 2022, while upcoming bookings for the 2023 winter and summer seasons hit 8.7 million.
First-quarter revenue reached 3.8 billion euros ($4 billion), while its group loss before interest and taxes halved to 158.7 million euros from 274 million euros a year earlier.
“Our strategy is clear: quality, cost discipline and market share.
New products, additional customers, and as a result, more market share and above-average growth are the basis for future increases in revenue and earnings,” TUI Chief Executive Officer Sebastian Ebel said.
European consumers are grappling with the highest levels of inflation in a generation, but to-date demand for holidays has proved resilient.
Low-cost airlines such as Ryanair, Wizz Air and easyJet have all reported strong summer bookings.
Price increases in the tourism sector remained lower than inflationary cost hikes, allowing for continued optimism, Ebel said, adding that the earthquake in Turkey had also caused a slight slowdown in bookings to that country.
Separately, TUI shareholders are expected to vote on a capital increase plan later on Tuesday to repay Germany’s Economic Stablisation Fund, set to take place by the end of the year.
“The actual capital raise, we will do that at the right time in the right capital market window,” Chief Financial Officer Mathias Kiep said.
($1 = 0.9317 euros)
(Additional reporting by Miranda Murray and Ilona Wissenbach; Editing by Himani Sarkar, Kim Coghill, Sherry Jacob-Phillips and Shounak Dasgupta)
