TUI third-quarter profit sinks 55%; reiterates full-year earnings guidance
StockMarketWire.com - Travel company TUI posted a 55% fall in third-quarter profit after it was hurt by lower consumer confidence and the grounding of Boeing's 737 MAX aircraft, though it stuck to its full-year earnings guidance.
TUI also announced that it had agreed to sell two German specialist businesses -- Berge & Meer and Boomerang -- for an enterprise value of €96m to €106m, including a €10m earn-out.
Net profit for the three months through June declined to €47.3m, down from €104.8m on-year.
Underlying Ebita fell 46% to €100.9m, as revenue rose 3.7% to €4.75bn.
For the first nine months of the company's financial year, it recorded a net loss of €240.4m and an underlying Ebita loss of €199.7m.
TUI reiterated its underlying Ebita guidance for the full year of up to a 26% fall from €1.18bn on-year.
The company's holiday experiences business, which includes its owned hotel and cruise ship units, posted a 16.7% rise in third-quarter underlying Ebita to €208.3m.
However, this was offset by the markets and airlines business swinging to a €103.9m loss over the period.
Costs related to the 737 Max grounding were expected to amount to around €300m for the year.
'We have seen a later booking behaviour to date from the ongoing knock-on impact of last year's extraordinary hot summer with demand continuing to be impacted by Brexit uncertainty,' TUI said.
For summer 2019, 87 % of the programme had been sold compared with 88% on-year, with bookings adown 1% but average selling price up 1%.
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