Tui, the travel operator, reported a stronger than expected start to its trading year on Tuesday, as first-quarter turnover rose and the company forecast full-year profit growth of at least 10%.
While the company, which formerly operated in the UK under the Thomson brand, reported a net loss for the period - not unusual for a travel company, many of which don't start generating profits until later in the year - the shortfall narrowed from the previous year.
First quarter highlights
- Turnover rose 9.1% on a constant currency basis to €3.549bn
- Underlying earnings before interest, tax, depreciation and amortisation up 112.6% to €69.3m
- Net loss for the period €58.7m, down from €81.6m in Q1 2017
- Net capital expenditure and investments €140.7m, down from €310.2m in Q1 2017
- Net debt narrowed to €874.2m from €1.518bn
The company said it had a good start to the financial year and expected demand and growth in digitalisation and investments would enable it to deliver on its growth strategy.
"Current trading is progressing in line with our expectations and we are well positioned to deliver at least 10% underlying EBITA growth in 2018," the company said.
Chief executive Friedrich Joussen (left) said: "We continue to grow. Following three consecutive years of double-digit earnings growth, we are aiming to deliver similarly strong growth in 2018.
“Our strategy is successful. Our focus is on hotels and cruises. While we used to be a trading company, we have now become developers, investors, and operators.
"This makes Tui more profitable, and we now generate our earnings more evenly across twelve months."
Investors welcomed the results and pushed the shares 2.44% higher to £16.40 on the London Stock Exchange.
The shares listed on the Frankfurt Stock Exchange in the company's native Germany, rose 2.91% to €18.47.
Picture courtesy of Tui Investor Relations website