Tui says winter holiday bookings affected by Omicron fears

Tui, Europe’s largest tour operator, warns that concerns about rising Omicron and coronavirus infection rates are beginning to affect bookings.

The company, often seen as a bell of confidence in travel, said Wednesday that “increasing media coverage of rising incident rates and the emergence of new Omicron variants” had a particularly negative impact on winter vacation bookings.

He added that if this trend continues, winter capacity (hotel rooms and flights offered to customers) will be around 60% in 2019, up from the previously expected 80%. I did.

Friedrich Joussen, CEO of Tui, said the introduction of new variants in the low season would be beneficial to the company. “I wouldn’t worry too much, but I can’t say it doesn’t affect me,” he said.

The emergence of Omicron at a time when infection rates were already rising in Europe has hit the hospitality and travel industry, reinstated restrictions, increased pre-travel testing and discouraged some passengers. rice field.

In the UK, Tui’s second market after Germany, this week’s government Reintroduction of pre-departure testing For those who enter the country.

Abta, a travel industry group, described the resurgence of testing as “a big blow to travelers and an already devastated travel industry.”

Edison analyst Richard Finch said increasing uncertainty about travel bans hinders the recovery Tui achieved in the final quarter of the fiscal year after benefiting from strong demand in Europe in the summer. Said there is a possibility.

For the three months to the end of September, Tui has made positive returns in the first quarter before interest, taxes, depreciation and amortization since the start of the pandemic.

However, by the end of September, full-year revenues were € 4.7 billion, 40% lower than fiscal year 2020 and 75% lower than 2019. The pre-tax loss was € 2.5 billion and the loss was € 2.5 billion. Profit of € 3.2 billion in 2020 and € 691 million in 2019.

The company is backed by consumers spending more on their holidays. Prices for next summer rose 23% compared to 2019 as people upgraded to more luxurious accommodation and chose longer vacations.

Joussen said Tui hopes to also benefit from the demise of rival Thomas Cook. Liquidation September 2019.

Despite the direct influence of Omicron, Tui said the summer vacation program was “well booked”, especially among UK customers, and Easter 2022 was already booked up to about 90% of the 2019 level. Said that.

October, Tui Raised 1.1 billion euros Through a rights issue, it has raised liquidity to 4.5 billion euros.

However, since the end of October, liquidity has declined to € 3.5 billion due to the normal low-season cash outflow. Citi analyst James Einley pointed out the weaknesses in recent bookings and said the company’s cash position declined “faster than expected.”

Tui says winter holiday bookings affected by Omicron fears Source link Tui says winter holiday bookings affected by Omicron fears

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