Tui Group faces €25 million in costs as wildfires on Rhodes forced the evacuation of 8,000 holidaymakers.
The figure was disclosed as Europe’s largest travel group swung back into profitability in the last quarter with current booking levels “confirming expectations” for a strong summer.
The financial impact of the wildfires in recent weeks involves cancellations and lost margin, customer compensation as well as repatriation flights and welfare costs totalled €25 million.
Tui said: “In total we evacuated 8,000 of our guests, but it is also important to point out that 80% of our guest on the island have been unaffected. Rhodes accounts for 5% of our full summer 2023 programme.”
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The group added: “We continue to monitor the situation concerning the wildfires in southern Europe and remain in close contact with local authorities.
“As events unfolded in Rhodes, the safety of our guests and colleagues in the affected areas was paramount.
“Together with our 300 service staff, we were able to provide our guests with 24/7 support and welfare.
“We operated 12 repatriation flights with additional aircraft deployed to bring our guests home safely, all highlighting the benefit of our customer proposition.
“However, we also want to support the communities on the island directly affected by the fires. The Tui Care Foundation has launched a fundraising campaign. Every donation received will be doubled by the foundation.”
Bookings were impacted in the short-term as a result of the wildfires in southern Europe and flight cancellations to Rhodes, but have subsequently recovered as operations have resumed.
As a result, bookings for the last week were up by 5% against summer 2022.
Tui emphasised: “For the customer it has once again been shown that the package tour booked with the tour operator offers great advantages and comprehensive service in extraordinary situations.”
The company achieved an underlying third quarter profit of €169.4 million against a loss of €27 million in the same period last year “and we are on track to deliver on full year 2023 expectations” as revenue rose by 19% to €5.3 billion.
This came as carryings in the three months rose by 9% to 5.5 million holidaymakers and 95% of equivalent pre-pandemic levels. Overall summer bookings are up 6% over last year to total 12.5 million, with average prices 7% higher.
Group-wide bookings are at 95% of the level of pre-pandemic summer 2019.
A total of 86% of summer capacity has already been sold, which is in line with the previous year and also pre-Covid 2019.
“The UK remains our most advanced market in terms of booking with 89% of the season sold and bookings at +1% against summer 2022 and +4% against summer 2019,” Tui said.
Bookings for winter 2023-24 “are at a very early stage but the season has started promisingly across our markets with the UK most advanced at 33% sold, up 7% year-on-year,” the company added.
Following a €1.8 billion capital raise in April, the group extended its existing credit lines totalling €2.7 billion in May.
Chief executive Sebastian Ebel said: “Summer 2023 is going very well and demand for holidays remains high.
“The Mediterranean remains the most sought-after destination for summer holidays.
“The heatwave in morthern Europe in June and the wildfires in southern Europe have only dampened temporarily the previously strong development – but overall it will be a very good travel summer and a good year for Tui in 2023.
“For the full year we continue to expect a significant year-on-year increase in underlying EBIT [earnings].
“We are investing today to continue to significantly grow profitably in the future. We continue to drive Tui’s transformation and strengthen our competitive position by investing in our profitable growth areas.”
He added: “The travel summer of 2023 will be very good for Tui – with very good figures from our hotels and resorts and our cruise brands, strong growth in the activities segment and an overall strong booking performance from our tour operators.
“Our competitive position is very good. Where we see challenges – in the UK market and in the Nordic countries – we have taken actions to strengthen and grow our market position. In all segments we are clearly focused on growth.”
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