Tui chief executive Fritz Joussen dismissed fears that the weak pound could price UK customers out of holidays as he reported Tui’s first-ever profit for the nine months to June.
Joussen reported UK bookings “at the high level” recorded last year “despite price inflation” in third-quarter results last week and described UK demand as “very resilient”.
He acknowledged “some weakening demand” following the fall in sterling after Britain’s vote to leave the EU, and said: “We didn’t know what the new normal in the UK would be.” But the Tui boss said: “It’s resilient now. People are getting used to higher prices.”
Joussen added: “Partly, people will go to destinations where costs are lower so they don’t see prices change.
“Spain is pretty full. Last year, we had an all-time high [to Spain] and this year we will be on similar levels. If demand is very high prices are high and other destinations build because they are more affordable. That is what is happening. We see Bulgaria increasing. People will change from the Canary Islands to Cape Verde.”
He forecast full-year growth in group turnover “of more than 3% [and] our underlying operating result to grow by at least 10%”, saying: “This good performance reflects our successful transformation and focus on our own hotel and cruise brands. We have significantly reduced the seasonal swing of our business.”
Joussen reported the sale of Travelopia to private-equity backers for £325 million and recent sale of Tui’s remaining stake in container-shipping firm Hapag Lloyd for €244 million would leave the group debt free at the end of the year.
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Tui reports 19% rise in third-quarter profits