TUI AG: Pre-Close Trading Update

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 TUI AG / Trading Statement 
TUI AG: Pre-Close Trading Update 
 
28-Sep-2017 / 08:00 CET/CEST 
Dissemination of a Regulatory Announcement, transmitted by EQS Group AG. 
The issuer is solely responsible for the content of this announcement. 
 
28 September 2017 
*TUI GROUP 
Pre-Close Trading Update* 
 
Prior to entering its close period ahead of reporting its full year results 
for the twelve months ending 30 September 2017 on 13 December 2017, TUI 
Group announces the following update on current trading. 
 
*Chief Executive of TUI Group, Friedrich Joussen, commented:* 
 
"As we near the end of the third financial year post merger, our results and 
trading performance show that we are consistently delivering our growth 
strategy. Our hotel and cruise brands continue to perform very well, having 
further expanded their unique offering this year; and the growth in Source 
Market customers demonstrates the strong appeal of our holidays and 
distribution capability. At this early stage, overall trading for future 
seasons remains in line with our expectations. Whilst there are at times 
external factors which can create uncertainty in specific markets and 
destinations, we are confident that our balanced portfolio, content led 
growth strategy and integrated model leave us well positioned to continue to 
deliver against our plans. We are therefore pleased to reiterate our 
guidance of at least 10% growth in underlying EBITA for the financial year 
2016/171, and look forward to providing an update on our strategy this 
December." 
 
1 At constant foreign exchange translation rates applied in the current and 
prior period, and based on the current group structure 
 
*Summer 2017* 
 
Overall, trading since our last update has remained in line with our 
expectations. Hotels & Resorts have continued to perform well, with high 
occupancy rates in most destinations and an increase in average revenue per 
bed compared with prior year. We will have opened ten new hotels in 
financial year 2016/17, bringing the total openings since merger to 28. In 
Cruise the launches of Mein Schiff 6 and TUI Discovery 2 this Summer have 
gone well. Yields and load factors remain strong. 
 
The Source Markets' programme is almost fully sold, with good growth in 
customer volumes, especially in Nordics, Germany and Benelux. Across our 
markets, customer volumes have grown versus last year for most destinations, 
especially Greece, Bulgaria, Croatia, Italy, Cape Verde and long haul. We 
are also pleased with the increase in bookings made direct and online (up 4% 
and 7% respectively), and with a further increase in sales of our own hotel 
and cruise brands. As previously stated, volumes in the UK have remained in 
line with last year's strong performance, despite the impact of the weaker 
Sterling on accommodation costs. In France, although the integration of 
Transat's tour operating business is progressing to plan, the lates market 
has been very competitive, with an adverse impact on margin. 
 
During the recent hurricanes, which affected our operations in the Caribbean 
and Florida, our primary focus has been on supporting customers staying in 
these areas and assisting with rebooking to alternative destinations where 
necessary. Despite this impact, we have reiterated our guidance of at least 
10% growth in underlying EBITA for the current financial year, demonstrating 
the resilience of our business model and our ability to deal with such 
external unforeseen events. 
 
*Source                          *Summer 2017* 
Markets - 
Current 
Trading2* 
*YoY                         *Total     *Total *Total *Programme 
variati                    Revenue* Customers*   ASP*  sold (%)* 
on%* 
 
*Northern Region*              *+8*       *+1*   *+7*       *98* 
UK                               +7       Flat     +7         98 
_Memo: UK incl. Thomson        _+9_       _+1_   _+8_       _98_ 
Cruise_ 
Nordics                         +14         +5     +9        100 
 
*Central Region*               *+9*       *+6*   *+3*       *98* 
Germany                          +6         +3     +3         98 
 
*Western Region*               *+6*       *+4*   *+2*       *95* 
Benelux                          +7         +4     +2         94 
 
*Total Source Markets*         *+8*       *+3*   *+4*       *97* 
_Memo: Total Source            _+9_       _+4_   _+5_       _97_ 
Markets incl. Thomson 
Cruises_ 
 
_2 These statistics are up to 24 September 2017, shown on a constant 
currency basis and relate to all customers whether risk or non-risk_ 
 
*Future Seasons* 
 
At this early stage, trading for future seasons is overall in line with our 
expectations. We will open five new year round properties in Hotels & 
Resorts this Winter for Riu, Robinson and Blue Diamond, and will reposition 
further hotels under our TUI Blue brand in 2018. We expect some hotel 
closures as a result of the recent hurricanes to allow for repair work to be 
carried out, but are overall pleased with demand for our clubs and hotels. 
In Cruise we have the first Winter of operations of our ships which launched 
in Summer 2017. Cruise demand remains strong for all three cruise brands and 
we remain pleased with yield performance. 
 
The Winter 2017/18 booking cycle for most Source Markets is still at an 
early stage, with just over a third of the programme sold, in line with 
prior year. Overall performance is positive, with revenues booked to date up 
7% and customer volumes up 3%. There is good growth in bookings for Cape 
Verde, Cyprus, North Africa and Thailand, although we are seeing some impact 
on demand for some parts of the Caribbean and Florida as a result of the 
recent hurricanes. Germany has had a strong start to the season, as TUI 
continues to gain market share. Nordics has also had a strong start, with 
customer volumes up compared with prior year and selling price performance 
reflecting the earlier sale of lower margin and shoulder season product. In 
the UK, booking and selling price performance are in line with our 
expectations, given the very strong start in prior year trading (when 
bookings were up 22%) and impact of currency inflation on selling price. 
Both load factor and percentage of the UK programme sold are in line with 
prior year, as we continue to balance capacity in line with demand. We are 
very pleased to launch the TUI rebrand in the UK in the coming weeks, ahead 
of the key Summer 2018 selling period. 
 
*Source Markets -                   *Winter 2017/18* 
Current Trading2* 
*YoY                      *Total     *Total   *Total *Programme 
variation%*             Revenue* Customers*     ASP*  sold (%)* 
 
*Northern                   *+4*       *-2*     *+6*       *41* 
Region* 
UK                            +2         -7      +10         37 
_Memo: UK                   _+7_       _-5_    _+13_       _39_ 
incl. 
Thomson 
Cruise_ 
Nordics                       +8         +9       -1         51 
 
*Central                   *+14*      *+11*     *+3*       *34* 
Region* 
Germany                      +13        +10       +3         34 
 
*Western                    *+3*     *Flat*     *+3*       *29* 
Region* 
Benelux                       +1       Flat       +2         27 
 
*Total                      *+7*       *+3*     *+5*       *36* 
Source 
Markets* 
_Memo: Total                _+9_       _+3_     _+5_       _36_ 
Source 
Markets 
incl. 
Thomson 
Cruises_ 
 
_2 These statistics are up to 24 September 2017, shown on a constant 
currency basis and relate to all customers whether risk or non-risk_ 
 
In Summer 2018, we are planning to open a Sensatori in Rhodes. We will also 
launch new ships for TUI Cruises (new Mein Schiff 1) and Thomson Cruises 
(TUI Explorer, previously Mein Schiff 1 in TUI Cruises), the sales for which 
continue to progress well. As usual, trading for the Source Markets is at a 
very early stage, and only the UK is more than 10% sold. UK revenue is up 2% 
compared with prior year, with bookings down 3%, in line with our 
expectations against strong prior year comparatives (when bookings were up 
7%). 
 
*Fuel/Foreign Exchange* 
 
Our strategy of hedging the majority of our jet fuel and currency 
requirements for future seasons, as detailed below, remains unchanged. This 
gives us certainty of costs when planning capacity and pricing. The 
following table shows the percentage of our forecast requirement that is 
currently hedged for Euros, US Dollars and jet fuel for our Source Markets, 
which account for over 90% of our Group currency and fuel exposure. 
 
                    *Summer 2017* *Winter 2017/18* *Summer 2018* 
Euro                     97%            90%             55% 
US Dollars               96%            89%             72% 
Jet Fuel                 95%            91%             80% 
_As at 22 September 
2017_ 
 
We do not hedge the impact of foreign exchange translation of results in 
non-Euro currencies. Based on exchange rates at current levels we anticipate 
an adverse impact of approximately EUR10 million to EUR15 million from 
foreign exchange translation on the full year 2016/17 underlying EBITA 
result. 
 
*Outlook* 
 
Overall, Summer 2017 is closing out in line with our expectations and we 
reiterate our guidance of at least 10% growth in underlying EBITA for the 
financial year 2016/171. Trading for future seasons, albeit at an early 
stage, is also overall in line with our expectations. Whilst there are 
external factors which can impact specific parts of the business, we are 
confident that our balanced portfolio, content led growth strategy and 
integrated model leave us well positioned to continue to deliver against our 
plans. 
 
1 At constant foreign exchange translation rates applied in the current and 
prior period, and based on the current group structure 
 
*Annual Report 2016/17* 
 
TUI Group will issue its Annual Report on Wednesday 13 December 2017 and 
hold a presentation for investors and analysts on the same day. Further 
details will follow. 
 
*Analyst & Investor Enquiries* 
 

Peter Krüger, Director of        Tel: [phone] 
Investor Relations and Special 
Projects 
 
Contacts for Analysts and Investors in UK, Ireland and Americas 
Sarah Coomes, Head of Investor   Tel: [phone] 
Relations 
Hazel Chung, Investor Relations  Tel: [phone] 
Manager 
 
Contacts for Analysts and Investors in Continental Europe, 
Middle East and Asia 
Nicola Gehrt, Head of Investor   Tel: [phone] 
Relations 
Ina Klose, Investor Relations    Tel: [phone] 
Manager 
Jessica Blinne, Team Assistant   Tel: [phone] 
 
The EQS Distribution Services include Regulatory Announcements, 
Financial/Corporate News and Press Releases. 
Archive at www.dgap.de/ukreg 
 
ISIN:           DE000TUAG000, DE000TUAG281, DE000TUAG299 
Category Code:  TST 
TIDM:           TUI 
LEI Code:       529900SL2WSPV293B552 
OAM Categories: 3.1. Additional regulated information required to be 
                disclosed under the laws of a Member State 
Sequence No.:   4661 
 
End of Announcement EQS News Service 
 
613683 28-Sep-2017 
 
 

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September 28, 2017 02:00 ET (06:00 GMT)