TUI share price jumps as annual growth beats guidance

on Dec 10, 2015
Listen

TUI’s (LON:TUI) share price surged at the opening bell today after the world’s largest tourism group reported solid annual growth, despite a turbulent year for the industry.

Are you looking for signals & alerts from pro-traders? Sign-up to Invezz Signals™ for FREE. Takes 2 mins.

In the 12 months ended September 30, TUI’s underlying core earnings rose 15.4 percent to €1 billion on a constant currency basis, beating the top-end of its own guidance for a rise of between 12.5 percent and 15 percent. The FTSE 100-listed group also posted an eight percent increase in underlying turnover in the year to 30 September, to €20 billion.

TUI, formed last December through the merger of London-listed TUI Travel and German majority owner TUI AG, further said that for its summer 2016 programme, it had seen a good start to trading, with bookings from Britain up 11 percent. This gave it confidence in its target to grow core earnings by at least 10 percent on a constant currency basis in the current financial year. TUI also said it would raise its dividend per share to 56 cents from 33 cents.

The tourism sector has been in decline since Britain suspended flights to the Egyptian resort area Sharm el Sheikh on fears that a bomb brought down a Russian plane late last month. Security fears were also intensified by the attacks on Paris that killed 130 people on November 13. Vacation packages to Tunisia from Britain had already been halted after the death of 38 tourists in a massacre on a Tunisian beach in June. However, Tui said its upbeat outlook “demonstrates the resilience of our business model, against the backdrop of the tragic events in Tunisia in June 2015 and geopolitical turbulence in some of our other destinations”.

Investors have hailed the update, sending TUI’s share price 5.71 percent higher to 1,185.00p as of 10:08 GMT. The group was outperforming the FTSE 100 index, which meanwhile stood 0.38 percent down at 6,103.45 points.

Ad

Want easy-to-follow crypto, forex & stock trading signals? Make trading simple by copying our team of pro-traders. Consistent results. Sign-up today at Invezz Signals™.

0/10
Learn more
Stock Market Transport & tourism