26th Sep 2013 07:24
LONDON (Alliance News) - TUI Travel PLC continues to outperform rival travel operator Thomas Cook Group PLC, as both companies issued pre-close trading statements Thursday. Though both reported positive conditions, TUI Travel lifted its full-year profit forecast for this financial year, while Thomas Cook left its unchanged.
The two travel operators, which are both listed in London and formed out of international mergers, also are both in the middle of transformation programmes.
Former Thomas Cook Chief Executive Officer Manny Fontenla-Novoa was accused of taking on too much debt for the company, and the company, with a storied history in the travel industry, has spent a lot of time getting its balance sheet back to a heathier state.
TUI Travel, on the other hand, was in slightly better shape before embarking on its restructuring.
TUI Travel raised its underlying operating profit growth forecast, saying it expects to achieve full-year profit growth of at least 11% on a constant currency basis.
TUI Travel said that its seen strong high-season summer trading in the UK and Nordics, with revenues up 8% and 10% respectively.
It said that so far it has sold around 31% of its overall mainstream programme for the winter 2013/2014 season, with average selling prices across all key markets up year-on-year. It also said that it has reduced its winter Egypt programme significantly, to increase capacity elsewhere.
TUI Travel said that it has seen strong online accommodation growth. It said that new customers in the UK, Nordics and Germany all rose, by 13%, 11% and 5% year-on-year, respectively for Summer 2013, while online sales accounted for 48% of the total in the UK, and 70% in the Nordics.
"Our strong performance in the market continues to be driven by increased customer demand for unique holidays and higher levels of direct distribution," said TUI Travel Chief Executive Officer Peter Long in a statement.
Meanwhile, Thomas Cook Group said its trading in line with expectations, and is confident in meeting full year profit targets, with the help of its cost-cutting measures and capacity reductions.
It reported positive summer trading figures, with over 95% of bookings for the summer season already sold. It said that as expected, its bookings on a year-on-year basis have slowed compared to last year's strong late-booking market, although bookings outperformed its planned capacity management by over 4%.
Thomas Cook said UK bookings were down 3% on last year, with a capacity reduction of 2.5%. It said that it expects UK trading to meet its full-year expectations, as it saw a year-on-year increase in average sales prices of over 4.5%.
It said that in Northern Europe bookings were 1% below last year, although its average selling price rose by approximately 4%.
It also said that Airlines Germany is finishing the year strongly, with booking and average selling prices both up around 3% on last year.
In early trading Thursday, TUI Travel was quoted at 364.40 pence per share, up 8.00p or 2.2%. Thomas Cook was down 10.00p or 6.4% at 145.60p.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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