13th Feb 2024 11:08
(Alliance News) - Tui AG on Tuesday reported a better first-quarter, including its best-ever revenue during a traditionally slower period, making the holiday firm one of the standout performers on a London equity market it is plotting an exit from.
Tui shares were up 2.9% at 596.50 pence each on Tuesday morning in London.
Tui's pretax loss narrowed to EUR103.1 million in the three months that ended December 31 from EUR272.6 million a year before, as revenue rose by 15% to a "record" EUR4.30 billion from EUR3.75 billion.
The revenue figure topped Deutsche Bank's prediction of EUR4.24 billion, but the German investment bank said the "real surprise" came at the bottom line.
Underlying earnings before interest and tax were EUR6.0 million, swung from a EUR153.0 million Ebit loss a year before. The outcome was markedly clear of Deutsche Bank's expectation of a EUR76 million loss.
It was Tui's first-ever positive adjusted Ebit during a first financial quarter.
In response the first-quarter performance, Tui on Tuesday reaffirmed its financial 2024 guidance of increasing underlying Ebit by at least 25%. In financial 2023, underlying Ebit was EUR977 million.
Tui also expects revenue to increase by at least 10% this year from EUR20.67 billion last year.
The Hannover, Germany-based holiday firm operates Hotels & Resorts, Cruises, Markets & Airlines, and the Tui Musement tours and activities businesses under the Tui, Hapag-Lloyd and First Choice brands.
Tui is holding its annual general meeting on Tuesday, at which shareholders will be asked to approve its plan to delist from the London Stock Exchange, while upgrading to a 'Prime Standard' listing in Frankfurt with inclusion on the MDAX index of German mid-cap stocks. The plan, announced early last month, is to achieve "centralisation of liquidity" for Tui shares.
Hargreaves Lansdown analyst Sophie Lund-Yates commented: "There are questions swirling about Tui's potential decision to drop its London listing. The added complexity and cost of maintaining dual listings since Brexit has seen others decide to go down a similar route. While it does little to change the business case, the optics for London are less than ideal."
AJ Bell analyst Russ Mould said the delisting makes sense for Tui, and its "patchy" record means it may not be "massively missed" by investors in the UK.
"However, if shareholders approve the London delisting, then it reduces the breadth and depth of a UK market already reeling from several snubs and high-profile departures," Mould added.
The London Stock Exchange, which has struggled to attract sizeable new listings, has also suffered a string of high-profile transfers of primary listings. Building materials firm CRH PLC moved its primary listing to New York in September. Plumbing and heating products supplier Ferguson PLC did the same in May 2022, months after miner BHP Group Ltd shifted its main listing to Sydney.
More recently, Paddy Power owner Flutter Entertainment announced it was looking to move its primary listing to New York. It would mean the firm is no longer eligible to be listed on the FTSE 100.
By Eric Cunha, Alliance News news editor
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