TUI Sees Robust Summer Trading Despite Tunisia Attack

Strong summer travel demand offset the impact of the Tunisian beach massacre for TUI which said annual profit would come in at the upper end of its forecast range.

TUI said summer trading had been robust and it now expected underlying core earnings (EBITA) to rise by between 12.5 and 15 percent in the current financial year, against a previous forecast for between 10 and 15 percent.

European travel companies have had to cope this summer with the impact of an attack on a beach in Tunisia in late June that killed 38 people, 33 of whom were TUI customers. The Greek financial crisis has also affected tourist travel.

Cancelled trips to Tunisia would cost between EUR€35 million and EUR€40 million (USD$39 million - USD$44 million) this year, TUI co-chief executives Peter Long and Friedrich Joussen said.

TUI and rival Thomas Cook pulled people out of Tunisia after Britain and other countries told them to leave. Trips to the North African country have been cancelled until October, leaving TUI with empty hotels.

Long was not optimistic that TUI's full summer offering in Tunisia would return any time soon.

"I sadly don't think that we're going to see a full reinstatement... in the near term," he said.

Thomas Cook said in July that its annual profit would be reduced by GBP£25 million due to events in both Tunisia and Greece.

This summer's robust demand has been driven by strong appetite for cruises and as Britons booked more holidays abroad, encouraged by the strength of the pound.

Tourists from northern Europe were deterred from booking trips to Greece in late June and early July due to concerns over Greece's potential exit from the euro zone.

TUI said that in recent weeks there had been a recovery in bookings to Greece, which accounts for about 10 percent of its trips, and overall bookings there were up year-on-year.

When asked about the situation on some Greek islands, notably Kos, where there have been clashes between police and migrants, TUI's Joussen said it was not affecting bookings at the minute.