DJ TUI AG: Quarterly Statement 1 October 2019 - 30 June 2020
TUI AG (TUI)
TUI AG: Quarterly Statement 1 October 2019 - 30 June 2020
13-Aug-2020 / 08:00 CET/CEST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
Quarterly Statement 1 October 2019 - 30 June 2020
Q3 FY20 Summary
· Group revenue of EUR 75m1, down 98%, reflecting business standstill for
most of the quarter with partial operations successfully resumed from
mid-May.
· 55 hotels reopened in the quarter (15% of total portfolio) as lockdown
restrictions eased worldwide from mid-May. Hotel volumes remain
significantly lower than usual summer levels however there were
encouraging signs of customer demand with average occupancy of 23%
achieved, reflecting the initial restart of operations in Europe, Mexico,
the Caribbean and Egypt and the necessary social distancing protocols in
place.
· All three Cruise operations remained suspended throughout the quarter,
adhering to both German and UK government advice on cruising.
· From mid-June, our Summer tour operator programme was partially
restarted from Central Region, taking customers to Majorca, Ibiza and
Formentera. Operations also resumed from Benelux.
· Q3 Group underlying EBIT loss of EUR 1.1bn1 reflects business
suspension for most of the quarter, impairments triggered by COVID-19 and
net costs arising from ineffective hedging contracts. Fixed costs were
reduced to around EUR 237m per month, in line with communication at H1
results, reflecting the swift action of our team to reduce cash fixed
costs by more than 70% as the business moved into crisis mode.
· 9M Group underlying EBIT loss of EUR 2.0bn1, an increase of EUR 1.8bn
versus prior year, reflects underlying costs of EUR 1.3bn from business
suspension since March, impairments triggered totalling EUR 410m and net
costs from ineffective hedges amounting to EUR 189m.
· Comprehensive compensation agreement relating to the Boeing 737 Max
grounding was concluded in the quarter. The specific details of the
agreement with Boeing are confidential however consist of three key
elements
1) staggered compensation to be received over the next two years
2) credits against future orders and
3) a deferral of 61 aircraft deliveries enabling our fleet capacity to be
flexed to all demand scenarios as the market recovers post COVID-19.
· Post balance sheet date on 7 July, we successfully completed the sale of
Hapag-Lloyd Cruises to TUI Cruises joint venture against a difficult
market environment on the terms and conditions agreed in February 2020.
The first stage of disposal proceeds has been received in the third
quarter with remaining proceeds and full deconsolidation to be competed in
the final quarter of the current financial year.
1 at constant currency rates
Bookings - latest position
· Bookings for Summer 2020 are down 81%2 and ASP down 10%. This equates to
16%2 sold of our original programme reflecting impact of cancellations
from mid-March, versus 88% sold at the same point last year. Rebased on
our adjusted capacity plans, we are currently 57% sold to date.
· Capacity plans for both Winter 2020/21 and Summer 2021 have been
adjusted from original plans to reflect both current government advice and
consumer demand. Capacity for Winter 2020/21 has been reduced by 40% and
overall bookings are down broadly in line with this capacity adjustment.
For the UK, bookings are down 5% 2 and ASP is up 2%.
· Summer 2021 capacity has been cautiously adjusted by 20%, with
flexibility to adjust as we gain more visibility. Bookings are currently
up significantly as customers both rebook holidays from this Summer and
look to secure new holidays early. Bookings for Summer 2021 are
consequently up 145%2 with ASP up 9%.
2 These statistics are up to 2 August 2020, shown on a constant currency
basis and relate to all customers whether risk or non-risk
Liquidity - latest position
We have reached an agreement with the German Federal Government for an
additional stablisation package for EUR 1.2bn. The package strengthens our
liquidity position and would provide sufficient liquidity in this volatile
market environment, to cover TUI's seasonal working capital swing through
Winter 2020/21 and thereafter, should there be further periods of travel
restrictions and disruptions related to COVID-19.
The additional stabilisation package agreed with the German Federal
Government is in the form of both debt and a convertible bond
· KfW loan increasing TUI's existing Revolving Credit Facility by an
additional EUR 1.05bn
· The drawing of the additional KfW tranche is subject to the issuance of
a convertible bond to the Economic Stabilisation Fund (WSF) in the amount
of EUR 150m by 30 September 2020
· The additional state aid is furthermore subject to an agreement with the
bondholders of the EUR 300m Senior Notes due in October 2021 regarding a
covenant waiver for potential future limitation of indebtedness
· The additional EUR 1.05bn RCF will have a maturity date in line with
the initial tranche - the maturity date of October 2021 will be
automatically extended to July 2022 on the refinancing of EUR 300m Senior
Notes bond ahead of October 2021
· Dividend payments and share buy-backs will be restricted for the term of
the stabilisation package. In addition, the stabilisation package provided
by the WSF will be linked to further limitations regarding, inter alia,
investments in other companies and the remuneration for Board Members as
long as the WSF remains invested
· Inclusive of the further liquidity agreed, the Group, as at 12 August,
would have total cash and available facilities amounting to EUR 2.4bn
Global Realignment Programme
We have launched a global realignment programme which targets to permanently
reduce our annual overhead cost base by 30% across the entire Group. A
comprehensive review of our activities across every business unit and group
companies worldwide to identify benefits and savings has been triggered. We
are targeting a permanent annual saving of more than EUR 300m with the
first benefits expected to be delivered from FY21 and full benefits to be
delivered by FY23. Negotiations have begun within respective business units
and we expect FY20 restructuring costs to be in the region of EUR 240m in
FY20, EUR 40m in FY21 and EUR 10m in FY22. In two years' time, TUI Group
will emerge stronger, leaner, more digitalised and more agile, in what is
likely to be a much more consolidated market.
Restart, transition, return to normalised levels in FY22 and beyond -
rebuild financial profile
FY21 will be a year of transition and we expect a normalised level of
business from FY22. Our performance to date and priorities over the next few
years can be summarised as follows: -
Q3 FY20 performance: Restart and liquidity management
· Successful and responsible restart across our markets, reopening of over
50% of Group hotels worldwide and launching short cruises in Europe by
August
· Well managed liquidity position, immediate reduction of cash costs by
>70% to crisis mode levels
· Expect to be broadly operationally cash break-even for Q4 FY20 based on
present restart operations
· Further liquidity secured with German government to support Winter 20/21
and thereafter
FY21 priorities: Transition
· Further ramp up in bookings as more destinations reopen and consumer
confidence returns
· Accelerate digitalisation initiatives and deliver global realignment
cost reduction programme
· Rebuild robust group financial profile - reduce gross leverage, restore
credit rating and return to profitability
FY22 and beyond: Return to normalised level of demand and profitable growth
· TUI is well positioned to emerge from the crisis as an even stronger
market leader due to its trusted brand and differentiated products
· First synergies from global realignment to be realised
· Benefits from digital accelerations and platform harmonisations
· Return to pre-crisis booking levels with subsequent growth
Our priority will be rebuilding a robust financial profile. The Group will
now evaluate options to achieve the optimal balance sheet structure to
support the business over the longer term.
Income statement of TUI Group for the period from 1 Oct
2019 to 30 Jun 2020
EUR million Q3 Q3 2019 Var. % 9M 9M 2019 Var. %
2020 adjusted 2020 adjusted
Turnover 71.8 4,745.0 - 98.5 6,710 11,421.4 - 41.2
.4
Cost of sales 983.6 4,519.2 - 78.2 7,954 11,146.1 - 28.6
.6
Gross profit - 225.8 n. a. - 275.3 n. a.
911.9 1,244
.2
Administrative 202.7 222.4 - 8.9 731.1 754.1 - 3.0
expenses
Other income 4.5 1.6 +181.3 97.6 14.4 +577.8
Other expenses 14.9 2.1 +609.5 18.6 16.0 +16.3
Impairment of 53.1 - n. a. 53.1 - n. a.
goodwill
Impairment of 72.1 - 7.0 n. a. 95.6 - 9.8 n. a.
financial
assets
Financial 4.8 11.7 - 59.0 27.2 81.6 - 66.7
income
Financial 56.1 39.8 +41.0 206.7 118.9 +73.8
expenses
Share of - 78.3 n. a. - 184.5 n. a.
result of 158.6 116.7
joint ventures
and associates
Earnings from - 60.0 n. a. - - 323.3 -
(MORE TO FOLLOW) Dow Jones Newswires
August 13, 2020 02:00 ET (06:00 GMT)
continuing 1,460 2,341 624.1
operations .0 .1
before income
taxes
Income taxes - 7.4 11.5 n. a. - - 82.7 +48.5
42.6
Group loss - 48.5 n. a. - - 240.6 -
1,452 2,298 855.3
.7 .5
Group loss - 22.8 n. a. - - 320.3 -
attributable 1,424 2,316 623.3
to .4 .6
shareholders
of TUI AG
Group loss - 25.7 n. a. 18.1 79.7 - 77.3
attributable 28.2
to
non-controllin
g interest
Condensed cash flow statement of TUI Group
EUR million 9M 2020 9M 2019
Cash inflow / cash - 1,959.0 700.8
outflow from
operating activities
Cash outflow from - 39.9 - 948.8
investing activities
Cash inflow / cash 2,303.9 - 718.2
outflow from
financing activities
Net change in cash 305.0 - 966.2
and cash equivalents
Change in cash and - 9.1 - 16.8
cash equivalents due
to exchange rate
fluctuation
Cash and cash 1,747.6 2,548.0
equivalents at
beginning of period
Cash and cash 2,043.6 1,564.9
equivalents at end
of period
of which included in 55.6 -
the balance sheet as
assets held for sale
Financial position of TUI Group as at 30 Jun 2020
EUR million 30 Jun 30 Sep
2020 2019
adjusted
Assets
Goodwill 2,914.7 3,009.2
Other intangible 656.7 710.7
assets
Property, plant 3,508.7 5,810.7
and equipment
Right-of-use 3,468.9 -
assets
Investments in 1,330.5 1,507.6
joint ventures
and associates
Trade and other 394.0 60.9
receivables
Derivative 15.4 43.9
financial
instruments
Other financial 13.0 43.0
assets
Touristic 137.7 183.7
payments on
account
Other 415.5 369.9
non-financial
assets
Income tax assets 9.6 9.6
Deferred tax 250.1 202.0
assets
Non-current 13,114.9 11,951.1
assets
Inventories 87.2 114.7
Trade and other 596.6 876.4
receivables
Derivative 198.0 303.8
financial
instruments
Other financial 9.5 31.1
assets
Touristic 1,033.0 908.7
payments on
account
Other 113.8 131.5
non-financial
assets
Income tax assets 62.2 155.7
Cash and cash 1,988.0 1,741.5
equivalents
Assets held for 808.3 50.0
sale
Current assets 4,896.6 4,313.5
Total assets 18,011.4 16,264.6
Financial position of TUI Group as at 30 Jun 2020
EUR million 30 Jun 30 Sep
2020 2019
adjusted
Equity and
liabilities
Subscribed capital 1,505.8 1,505.8
Capital reserves 4,207.5 4,207.5
Revenue reserves - 5,245.6 -
2,259.2
Equity before 467.7 3,454.2
non-controlling
interest
Non-controlling 685.5 711.4
interest
Equity 1,153.3 4,165.6
Pension provisions 959.4 1,035.6
and similar
obligations
Other provisions 769.4 775.0
Non-current 1,728.7 1,810.6
provisions
Financial 4,133.9 2,457.6
liabilities
Lease liabilities 2,917.4 -
Derivative 58.9 59.1
financial
instruments
Other financial 30.8 18.8
liabilities
Other 198.8 100.1
non-financial
liabilities
Income tax 61.7 70.9
liabilities
Deferred tax 151.1 226.9
liabilities
Non-current 7,552.8 2,933.5
liabilities
Non-current 9,281.6 4,744.2
provisions and
liabilities
Pension provisions 30.6 32.4
and similar
obligations
Other provisions 397.3 361.9
Current provisions 427.9 394.3
Financial 84.7 224.6
liabilities
Lease liabilities 727.8 -
Trade payables 1,458.0 2,873.8
Derivative 331.4 157.1
financial
instruments
Other financial 686.0 89.6
liabilities
Touristic advance 2,534.3 2,911.2
payments received
Other 748.8 519.3
non-financial
liabilities
Income tax 63.4 81.9
liabilities
Current 6,634.2 6,857.4
liabilities
Liabilities 514.5 103.1
related to assets
held for sale
Current provisions 7,576.6 7,354.9
and liabilities
Total equity and 18,011.4 16,264.6
liabilities
Cautionary statement regarding forward-looking statements
The present Quarterly Statement contains various statements relating to TUI
Group's and TUI AG's future development. These statements are based on
assumptions and estimates. Although we are convinced that these
forward-looking statements are realistic, they are not guarantees of future
performance since our assumptions involve risks and uncertainties that could
cause actual results to differ materially from those anticipated. Such
factors include market fluctuations, the development of world market prices
for commodities and exchange rates or fundamental changes in the economic or
political environment. TUI does not intend to and does not undertake any
obligation to update any forward-looking statements in order to reflect
events or developments after the date of this Statement.
Analyst and investor enquiries
Mathias Kiep
Group Director Investor Relations and Corporate Finance
Tel.: + 44 1293 645 925 /
+ 49 511 566-1425
Nicola Gehrt
Director, Head of Group Investor Relations
Tel.: + 49 511 566-1435
Contacts for analysts and investor in UK, Ireland and Americas
Hazel Chung
Senior Investor Relations Manager
Tel.: +44 (0)1293 645 823
Corvin Martens
Senior Investor Relations Manager
Tel.: + 49 170 566-2321
Contacts for analysts and investor in Continental Europa, Middle East and
Asia
Ina Klose
Senior Investor Relations Manager
Tel.: +49 (0)511 566 1318
This Quarterly Statement, the presentation slides and the video webcast for
9M 2020 are available at the following link:
www.tuigroup.com/en-en/investors [1]
Financial Calendar
Date
Quarterly Statement Q3 2020 13 August 2020
Pre-Close Trading Update September 2020
Annual Report 2020 December 2020
Annual General Meeting 2021 February 2021
TUI AG
Karl-Wiechert-Allee 4
30625 Hanover, Germany
Tel.: + 49 511 566-00
www.tuigroup.com
ISIN: DE000TUAG000
Category Code: QRT
TIDM: TUI
LEI Code: 529900SL2WSPV293B552
OAM Categories: 3.1. Additional regulated information required to be
disclosed under the laws of a Member State
Sequence No.: 81646
EQS News ID: 1116953
End of Announcement EQS News Service
1: https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=redirect&url=8e080343e3e3e5bb48431aa13ff7cbdd&application_id=1116953&site_id=vwd&application_name=news
(END) Dow Jones Newswires
August 13, 2020 02:00 ET (06:00 GMT)
© 2020 Dow Jones News
