6th Oct 2021 07:02
(Alliance News) - Tui AG on Wednesday said it has seen a bounce in holiday bookings, as Germany and Netherlands lead the way, with the UK playing catch-up but getting a boost more recently as travel curbs have been relaxed.
In addition, the tour operator announced plans to go cap in hand to investors once again, this time raising EUR1.1 billion through a fully underwritten capital increase with subscription rights.
Tui will offer investors 523.5 million new shares. They will be handed out at a ratio of 10 new shares for every 21 existing shares already held.
The new stock will be priced at EUR2.15 each, which Tui explained is a 35% discount to the theoretical ex-rights price.
Tui shares closed 1.9% lower at 326.80 pence, about EUR3.84, each in London on Tuesday. The stock is up 14% so far this year, however.
The money raised will go towards paying back all drawings under its loan facility with German state-owned development bank KfW. Drawings stood at EUR375.0 million as of Monday.
The cash will also contribute towards paying down part of a separate cash facility, which as of the start of the week had EUR1.49 billion drawn. Drawings of this facility would be reduced to EUR762.0 million.
Turning to its trading, Tui said overall bookings for its summer 2021 programme, which runs from July to October, totalled 5.2 million, a 1.1 million increase since an update in August. Tui ended its financial year on September 30.
"For peak summer period to date (July to October), we have so far operated a capacity of 42% for July and 48% for August," the company said.
In Germany and the Netherlands, summer bookings were "well-ahead" of levels seen in 2019, before the onset of the pandemic. The UK has lagged, however, but a recent change in travel rules has led to a pick-up in bookings.
Under plans announced in September, which then came into effect on Monday, the UK's traffic light travel system has been scrapped.
Locations are now categorised as either on the red list or not - and there are UK press reports that the number of countries on the red list will be slashed to nine from 54.
Since plans for the relaxation were announced, UK winter getaway bookings have been "trending strongly", Tui said.
"As a result, we now expect to operate a capacity for peak summer period (July to October) of between 50% and 60%. Peak summer period bookings (July to October) are currently 49% of 2019 levels," the company said.
As a holiday firm, Tui was badly-hit at the onset of the pandemic, as mobility curbs and the spread of the contagion sapped demand for travel and emptied skies.
Tui has turned to equity raises before and also received government relief packages.
In January, the company raised EUR568 million through a capital increase. It formed part of a financing package which also included a EUR200 million additional facility from KfW and a EUR700 million package from Germany's Economic Stabilization Fund.
By Eric Cunha; [email protected]
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