TUI reports profit slump but bookings pick up as war‑fuel pressures ease
TUI posted a sharp profit decline for the quarter but said new bookings have jumped, hinting at a gradual normalisation of European travel.
TUI announced that its net profit for the June quarter fell 44.7% to €124.2 million, even as the company said bookings in the last four weeks were up 7% compared with the same period a year ago.
War, fuel and heat drive a turbulent summer
The dip in earnings reflects a perfect storm of higher jet‑fuel costs, sparked by the United States and Israel war against Iran, and extreme weather across the Mediterranean. Heatwaves and wildfires have roiled Spain, France, Portugal and Greece, while airlines and cruise lines grapple with the same fuel price surge.
"Business is coming back, it's normalising," chief executive Sebastian Ebel said on the earnings call. "We have seen strong weeks."
Hotel occupancy across the group slipped 3% in the quarter, a modest improvement from a 6% fall in the previous half‑year. Earlier in April, TUI issued a profit warning after the Middle‑East conflict forced the repatriation of 10,000 guests, including 5,000 stranded on two cruise ships in the Gulf.
Looking ahead to a steadier recovery
Ebel said the company has not yet felt the impact of the ongoing Europe's heatwave on bookings, as many of its destinations remain cooler than the scorching conditions in Germany. He added that a hotter summer could actually boost demand for autumn and spring travel, strengthening the traditionally weaker shoulder seasons.
Analysts will watch whether the uptick in bookings translates into higher revenues later in the year, and whether fuel‑price volatility eases enough for operators to restore profit margins.
