For 2009 the International Monetary Fund (IMF, World Economic Outlook, April 2009) has revised its previous forecasts. The Fund currently expects a decline of 1.3% in global gross domestic product and thus the most comprehensive recession since the end of the Second World War. Experts consider a substantial recovery in the second half of the year to be unlikely. Rather, they expect a continued – albeit in some cases slower – contraction of the world economy for the remainder of the year and presume that economic activity will pick up relatively moderately in 2010. For the US, the losses in the value of financial and property assets and the uncertain perspectives in the labour market are expected to result in further declines in private household spending. This development is also forecast for the Eurozone; however, recessionary tendencies may slow down somewhat in the second half of the year in this region. In the light of the persistently weak demand in the industrialised countries, the economy is not expected to pick up in the emerging countries in the next few months, either.
Tourism
The UNWTO (World Tourism Barometer, January 2009) expects the tourism market to stagnate or decline by up to 2% for the overall year 2009. The forecast may have to be further revised downward if the current recessionary tendencies should aggravate.
In the first quarter of 2009, the persistently difficult economic environment in TUI Travel’s volume business resulted in weaker incoming bookings, as expected. Booked turnover in TUI Travel’s Mainstream business decreased 5% year-on-year in the winter season, with customer volumes down 14% year-on-year on 16% less capacity. For the summer season, booked turnover is 13% and customer volumes 15% down year-on-year. At the same time, TUI Travel has reduced its capacity for the 2009 summer season by 14%. This active capacity management has proven its worth in the year to date. Restrictive capacity management secured load factors and sound pricing in the winter season. For the forthcoming summer season, TUI Travel also expects to be able to achieve the planned pricing and load factor targets in an overall declining market. While adverse earnings effects were recorded in the first quarter of 2009 due to external factors impacting the travel market in individual destinations, the business performance in the rest of the year will benefit from the sustainable synergies from the integration of tourism activities. Following a further upgrade in the first quarter of 2009, these synergies will account for 200m British pounds in the final phase.
TUI Hotels & Resorts continues to expect stable earnings year-on-year for the current financial year. It remains to be seen whether the current softening of bookings for Mexico caused by the ‘swine flu’ will have a lasting effect.
Due to the start-up costs for TUI Cruises to be expected for financial year 2009, earnings by cruise activities continue to be expected to fall considerably short of the previous year’s level.
Based on the current earnings estimates for TUI Travel, TUI Hotels & Resorts and Cruises, the TUI Group expects tourism, its core business, to continue to post a stable development of operating earnings. The planned capacity cuts are expected to help avoid a margin risk for the summer business.
Discontinued operation
Concerning the global demand for container transportation, the IHS Global Insight research institute has adjusted its forecast from previous year downward and currently expects a decline of 3% (IHS Global Insight, March 2009). Here, too, a further deterioration of earnings cannot be ruled out in the light of the current negative economic forecasts.
Hapag-Lloyd recorded a first quarter, which fell short of expectations and continues to expect a considerable decline in earnings year-on-year due to lower volumes and a fall in average freight rates. The share of results of joint ventures and associates to be included in the consolidated financial statements as from April 2009 following the completion of the sale of the container shipping will therefore be negative.
Continuing operations/Group
Overall, the Executive Board expects earnings by the TUI Group’s continuing operations (tourism and all central operations) to decline in financial year 2009 as a result of the reduced business volume in tourism and the persistent weakness of the exchange rate of the British pound.
In the light of the expected negative at equity profit contributions by container shipping, going hand in hand with a stable development of tourism, underlying earnings by the TUI Group for 2009 are expected to fall below the level generated in the completed financial year 2008. Further adverse effects on the development of earnings may arise from the repercussions of the current financial and real market crisis on operative business.
Reported consolidated earnings will be positive in 2009 due to the decrease in integration expenses in tourism and the gains on disposal from the sale of container shipping and will improve significantly year-on-year.
24.05.2012
