Tui to reveal scale of Covid losses amid concerns over Omicron travel impact

Travel group Tui is set to reveal heavy losses next week after Covid travel curbs continued to hamper performance across its divisions throughout the year.

The update will come just as renewed restrictions threaten to derail the group’s plans to ramp up capacity over the winter holiday season.

Bosses said in October that the firm was planning to hit 60-80% of pre-pandemic volumes and they will be looking to reassure investors that plans will be going ahead when they update the City on the full year’s trading on Wednesday December 8.

Tui revealed losses of 939 million euro (£802 million) in the nine months to June, down from 1.5 billion euro (£1.3 billion) on the same period in 2020 as it benefited from an uptick in customers booking holidays to take place over the key summer period.

The group delivered around 2.6 million holidays over the summer, doubling the 1.3 million customers in the same period last year, and investors will be keen to see whether this can temper losses for the full year’s trading.

Winter holiday bookings topped one million, which Tui said had been driven by tourists looking or winter sun in the Canary Islands, mainland Spain, Egypt and Cape Verde.

But all eyes on will be on guidance for the period ahead to see how much the group has pared back plans on the back of increased European travel restrictions.

Analysts at S&P Global warned in October that a return of restrictions could push a full recovery in trading volumes beyond late 2022.

They said: “Long-haul destinations or destination countries with lower vaccination rates, such as Turkey, are expected to recover more slowly because of travel restrictions or lower demand.

“Volumes will likely not approach pre-pandemic levels before the second half of April-September 2022, and could be further depressed by renewed or prolonged travel restrictions.”

Despite an uptick in winter holidays, bookings overall remained at 54% of pre-pandemic levels and the group said it was prioritising addressing the high levels of debt it had accrued borrowing during the pandemic.

The firm bolstered its cash reserves for the winter with a 1.1 billion euro capital increase in October raised by selling shares.