One of the UK’s largest travel companies, Tui, has reported pre-tax profits of £144m up to the end of September.
The travel group, which operates the Thomson and First Choice travel brands, recorded the increase in profitability after making a loss of £73m in 2010.
Record underlying operating profits of £471m were up by 18 per cent despite the challenging economic environment.
“We are very pleased with our robust performance in 2011 and have delivered another year of profit growth, against a backdrop of unrest in key North African destinations and weak consumer sentiment in some source markets,” said Peter Long, Chief Executive of TUI Travel PLC.
“The UK, Nordic region, Belgium, the Netherlands, Canada and Austria delivered record results. These achievements reflect the strength of our strategy to increase differentiated and exclusive product sales, increase controlled distribution with a focus on online to enhance our customer access and reduce distribution costs, and our delivery of the turnaround and cost efficiency programmes.”
But despite the better than expected performance of the company, winter holiday bookings, particularly to destinations such as North Africa, are lower than they were last year – in total 11 per cent lower than last year. Tui will cut capacity on UK holidays by 9 per cent for winter and summer 2012 travel deals. In the UK Tui claims to have currently sold 19 per cent of next year’s programme.
In Specialist & Activity revenue, Tui reported year-on-year profits up by 7 per cent, with growth achieved in all divisions except Adventure, which continues to be affected by lower demand for North Africa. Education and North American Specialist travel packages are performing well.
The Tui figures are in contrast to the current struggles experienced by rival Thomas Cook, which was on the brink of bankruptcy until the operator secured its short-term future with banks making £200 million worth of funds available.
