A positive booking momentum and strong close to summer trading has left Tui Group “well positioned” to achieve at least a 25% hike in annual profits from €977 million achieved last year.
Summer bookings remain six per cent up year-on-year with 1.4 million more taken since the company’s last update on August 14 to give a total of 14.7 million for the season.
Tui said: “At 97%, virtually all of the programme has now been sold, which is 1% ahead of summer 2023.
“The UK is 97% sold with cumulative bookings up five per cent.”
Europe’s largest travel company has seen a 10% rise in bookings from Germany as it added capacity to Turkey, Greece, the Balearics, the Canary Islands and Egypt in response to the collapse of rival FTI.
“Across our markets, the short- and medium-haul programme has seen the strongest growth, with Spain, Greece and Turkey being the most sought-after destinations,” Tui said in a trading update for the year to the end of September.
“Bookings continue to be promising for winter 2024-25, with stronger demand for our wholesale and dynamic packages, translating into 7% more bookings taken.”
The winter performance comes as consumers “continue to prioritise spend for leisure experiences” with 1.8 million bookings taken so far.
“As usual, trading for the season is at a relatively early stage with 33% of the programme sold which is one per cent higher than the prior winter season,” Tui added.
“We have seen stronger demand year-on-year across all our key short- and medium-haul destinations with the Canaries, Egypt and Cape Verde again proving to be most popular.
“Thailand, Mexico, and the Dominican Republic are set to form a key part of our long-haul offering for the winter season.
“In [the] UK, which has been on sale for the longest period, bookings are in line with the high levels of the prior winter season. Here, 40% of the programme has been sold.”
Tui highlighted the popularity of its cruise offering across 17 ships, including five in the Marella fleet, in both the German speaking and UK markets.
The company’s in-house hotel portfolio across multiple brands has seen a six per cent rise in booked occupancy levels with a seven percent increase in average daily rates “emphasising the popularity of the product available.
“Key destinations for the half-year are expected to be the Canaries, Egypt, Cape Verde and the Caribbean.
“The segment is set for further growth in FY25 as we continue our hotel portfolio expansion across our destinations.”
The group added: “We continue to trade in line with management expectations and therefore reaffirm our guidance to increase underlying EBIT [earnings before income and taxes] and by at least 25% year-on-year.
“We have a clear strategy to accelerate profitable growth by increasing the customer lifetime value, creating a business which is more agile, more cost-efficient and achieving a higher speed to market with the aim to create additional shareholder value.”
Tui is due to issue results for the full financial year on December 11.