TUI Group completes 1.1 billion euros capital increase to strengthen the balance sheet – Demand for travel remains high

• 1.1 billion euros fully underwritten capital increase with subscription rights enables sustainable strengthening of the balance sheet structure and lower interest costs
• Major shareholder Unifirm / Mordashov family has undertaken to exercise all subscription rights attributable to its shareholding and to subscribe directly for these new shares
• Demand for travel remains high: Overall Summer 2021 programme totals 5.2 million bookings, an increase of ~1.1 million since an update in August
• Over 2.6 million customers have booked a TUI holiday during July and August 2021 – twice as many as in the same period of the previous year; Summer 21 bookings in the last few weeks in Germany and the Netherlands well above the level of Summer 19 (see details hereunder)
• As of October 4, 2021, TUI’s cash and available facilities amounts to 3.4 billion euros – slightly more than in August 2021
• CEO Joussen: „We want to, we can and we will find our way back to economic strength. We are working on this relentlessly. The capital increase is a further step. We want to repay the government loans quickly.“

Demand for travel remains high: 5.2 million summer bookings

Overall Summer 21 programme of the Group now totals 5.2m bookings, an increase of c.1.1 million bookings since our August update. In particular, TUI has seen strong improving trends over recent weeks with bookings in Germany and the Netherlands in particular, well ahead of Summer 2019 levels.

This reflects the returning customer confidence in departure in our Continental European markets. with load factor improvement in the last two to three weeks before departure evident of the short-term booking trend and pent-up demand for TUI holidays. The high demand for travel and the continuing short-term booking trend is reflected in the load factor improvement of the aircraft fleet in the last two to three weeks before departure. Over 2.6m customers departed for their TUI holidays during July and August, doubling the 1.3 million customers who travelled in July and August last year.

For the overall Winter 2021/22 programme, bookings at this stage are 54 percent of Winter 2018/19 levels and ASP is up +14 percent. Travel restrictions are now largely lifted for short and medium-haul winter destinations in key markets and the vaccination rates of the EU and UK adult population has reached a very high level. Therefore, TUI expects a wider increase in international travel this Winter.

TUI currently plans winter capacity between c.60 to c.80 percent of a normalised programme, with long-haul destinations expected to recover more slowly. The most popular winter destinations include the Canary Islands, mainland Spain, Egypt and Cape Verde.

For Summer 2022, TUI has a very encouraging pipeline of 1.6 million bookings. Overall Summer 2022 bookings are up 54 percent and ASP is up 15 percent versus Summer 2019 in the same period.  Turkey, Florida, Greece, and Cyprus are the most popular destinations at present. With the strong indications of pent-up effects, TUI believes Summer 2022 volumes will likely recover close to normalised levels of Summer 2019.

The demand is there. Wherever government travel restrictions have been lifted, TUI immediately experiences the rapid return of business, catch-up effects and higher sales of customers for their trips. In Germany and the continental European markets, this development could already be seen throughout the Summer of 2021. In England, this occurred more frequently after the previously extensive restrictions were eased in recent weeks.