TUI is reporting a surge in late summer holiday bookings.
After a quiet summer due to travel restrictions, the group announced plans to raise 1.1 billion euros to reduce its debt.
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“We’re committed to providing a great opportunity to help you,” said Fritz Joussen, CEO of Tui. “As capital increases, we can take a big step towards our goal of quickly repaying government loans.”
TUI has been bailed out several times by the German government since the start of the pandemic.
Usually, around 9 million people booked for summer vacation, but this year’s booked was around 5 million. This was driven primarily by late summer holiday bookings by German and Dutch customers.
Russ Mold, investment director at AJ Bell, commented: Not for the first time in this crisis, the slow return to tourism’s normalcy has caused problems, putting more strain on the balance sheet than the tricycle elephant.
“The assumption from the pandemic was that despite the very troublesome balance sheet, TUI would never go to the wall, as German authorities would always intervene to bail out that.”
“However, the state-supported loans they received were not handouts. They need to pay them off, and therefore they need to go out and raise more funds through the issue of rights.”
