Thomson and First Choice parent company Tui AG has reported a jump in annual profits following improved performance in its subsidiary Tui Travel and the group’s hotels and resorts business.
The group’s net profit was up 20% on the previous year, rising to €141.9 million for 2011-12, while revenue rose 5% to €18.3 billion.
Tui said it is optimistic about 2013, and anticipates a “slight” increase in revenue.
The group’s chief executive Michael Frenzel said: “Our business model has proven to be stable and sustainable despite a challenging economic framework in our key source markets in Europe.
“Tui is outperforming the market. Thanks to our product strategy and our efficient capacity control, we have delivered record operating results.”
Frenzel added that net debt had been reduced by €639 million to €178 million.
Tui Travel, which owns Thomson and First Choice, saw revenue rise by 5%, with operating profits up almost 30% at €637 million, while its hotels and resorts business had a revenue increase of 6%, with operating profits up by almost a quarter at €179 million.
For Tui’s cruise division, revenue also rose but operating profits fell sharply, partly because of its efforts to expand its fleet.
Frenzel said that Tui is working on expanding its emerging-markets business, and the company plans to play an increasingly bigger role in the cruise industry.
Tui has cut its debt by selling off part of its interest in shipping company Hapag-Lloyd, and it now owns 22 % of the business.