TUI AG · XETR:TUI1
TUI — H1 2016/17 Earnings Presentation
46 slides from TUI's earnings presentation, May 15, 2017
Slide 1: 2016/17 H1 Results
2016/17 H1 Results 15 May 2017 Anaga Mountains, Tenerife, Canary Islands
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains a number of statements related to the future development of TUI. These statements are based both on assumptions and estimates. Although we are convinced that these future-related statements are realistic, we cannot guarantee them, for our assumpt
Slide 3: Agenda
Agenda 1 2 3 Opening Remarks Performance Review & Financial Performance Fritz Joussen Current Trading & Outlook Fritz Joussen Horst Baier 4 5 Summary Q&A Fritz Joussen Fritz Joussen & Horst Baier 3 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 4: Opening Remarks
Opening Remarks Good overall performance in H1 Delivering our transformation, Successful migration to with significant growth in hotel one brand continues and cruise profits More relevant to more customers – Proven resilience of the integrated Reiterate our guidance of at least growth in customers i
Slide 5: Clearer reporting to reflect performance of our Hotel and Cruise Businesses
Clearer reporting to reflect performance of our Hotel and Cruise Businesses FY16 UNDERLYING EBITA MIX FY16 UNDERLYING EBITA MIX – NEW SEGMENTAL REPORTING 29% Blue Diamond Hotels 31% Hotels €287m 42% from Northern Region Hotels €304m 50% 58% Hotels & Resorts 50% Cruises €130m Segment 13% 19% Cruise
Slide 6: Performance Review & Current Trading
PERFORMANCE REVIEW & CURRENT TRADING FRITZ JOUSSEN 6 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 7: H1 Review
H1 Review • Good overall performance in H1 driven by growth in Hotels & Resorts and Cruises • Further merger synergies of €10m achieved in the half UNDERLYING TURNOVER €6.4bn EBITA €-214.3m • Current trading for Summer 2017 in line with our expectations +3.3% /+8.2%1 -3.8% /+6.3%2 • Improved working
Slide 8: TUI Group Underlying EBITA Bridge H1 2016/17 in €m
TUI Group Underlying EBITA Bridge H1 2016/17 in €m -206 -193 €37m -214 -237 10 2 -24 25 31 -38 17 H1 15/16 Restatement for H1 15/16 Underlying Merger Aircraft TUI fly sickness H1 16/17 Easter timing FX H1 16/17 Discontinued Continuing Ops Trading Synergies Financing Continuing Ops translation Contin
Slide 9: Hotels & Resorts
Hotels & Resorts TURNOVER AND EARNINGS (€M) BRIDGE UNDERLYING EBITA (€M) 5 3 -3 -9 -3 H1 16/17 H1 15/16 % 34 Turnover 300.0 266.0 12.8 12 135 123 Underlying EBITA 122.8 96.0 27.9 96 84 o/w Equity results 42.8 30.8 39.0 Segment now includes Blue Diamond Hotels H1 15/16 Reclassification H1 15/16 RIU R
Slide 10: Hotel Openings & Pipeline
Hotel Openings & Pipeline OCT 2016 MAY 2017 DEC 2017 Opened Nov 2016 Opened Nov 2016 2 Hotels, 1 Resort, Opened March 2017 Openings calendar H2 Openings calendar H2 RIU Reggae Blue Diamond Royalton Blue Diamond Royalton TUI Blue Jadran Riu Dunamar Jamaica Blue Waters Jamaica & Hideaway Negril Croati
Slide 11: Cruises
Cruises TURNOVER AND EARNINGS (€M) BRIDGE UNDERLYING EBITA (€M) 5 -3 H1 16/17 H1 15/16 % 16 8 Turnover 345.9 308.9 12.0 9 78 75 Memo: TUI Cruises Turnover 458.8 364.2 26.0 49 40 Underlying EBITA 75.0 49.3 52.1 o/w EAT TUI Cruises* 38.3 29.8 28.5 H1 15/16 Reclassification H1 15/16 TUI Thomson HL Crui
Slide 12: Cruise additions and pipeline
Cruise additions and pipeline New New Currently MS1 Currently MS2 Hanseatic Hanseatic Mein Schiff 6 TUI Discovery 2 Mein Schiff 1 Mein Schiff 2 (TUI Explorer) (Name TBC) Nature Inspiration 2,534 2,894 2,894 1,832 1,924 1,912 230 230 BERTHS BERTHS BERTHS BERTHS BERTHS BERTHS BERTHS BERTHS Wholly owne
Slide 13: Source Markets – Sales & Marketing
Source Markets – Sales & Marketing TURNOVER AND EARNINGS (€M) BRIDGE UNDERLYING EBITA (€M) H1 16/17 H1 15/16 % -287 -307 Turnover 5,374.9 5,261.0 2.2 -379 -384 Underlying EBITA -383.9 -307.2 -25.0 -20 -21 -5 -22 -24 -29 24 Thomson Cruises and Blue Diamond now reported in Cruise and H&R respectively
Slide 14: Strength in direct Distribution and Customer Relationships
Source Markets – Sales & Marketing Strength in direct Distribution and Customer Relationships • Balanced portfolio of source markets de-risks our BALANCED PORTFOLIO MORE DIRECT, MORE ONLINE business FY16 Customer Numbers (m) 73% UK 68% • Strong direct and online distribution channels FY14 1.2 German
Slide 15: Current Trading – Summer 2017
Current Trading – Summer 2017 HOTELS & • Two new TUI Blue hotel openings (Italy and Croatia) RESORTS • Subdued demand for Turkey and North Africa continue to be offset by the popularity of Spain, Canaries, Greece and Caribbean CRUISES • Newly built Mein Schiff 6 will launch in June; demand for cruis
Slide 16: Delivering the TUI Transformation
Delivering the TUI Transformation Merger complete + synergies delivered (end FY17) Integrated decision making + global scale based on common platforms (Brand, IT, Airline, Hotels, Cruises & Destination Services) The world’s leading integrated Disposals of non-core businesses free up capital tourism
Slide 17: Financial Performance & Outlook
FINANCIAL PERFORMANCE & OUTLOOK HORST BAIER 17 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 18: Income Statement
Income Statement In €m H1 16/17 H1 15/16 Turnover 6,382.4 6,178.7 ADJUSTMENTS €38M Underlying EBITA -214.3 -206.4 Consisting of €22m SDIs and €15m PPAs Full year expected to be ~€100m due to earlier recognition of Transat Adjustments (SDI's and PPA) -37.6 -34.5 integration costs EBITA -251.9 -240.9
Slide 19: Cash Flow
Cash Flow In €m H1 16/17 H1 15/16* EBITA reported** -251.9 -240.9 Depreciation** 199.6 187.7 Working capital -73.3 -373.4 IMPROVEMENT IN WORKING CAPITAL +€0.3bn Other cash effects 48.6 105.6 Improved seasonality in working capital following the disposal of Hotelbeds as we continue to deliver on our
Slide 20: Delivering the TUI Transformation – Financial Discipline
Delivering the TUI Transformation – Financial Discipline Business balanced through markets and destinations Further de-risked through portfolio ownership structure JV partners provide expertise; require less invested capital on a consolidated basis; delivering cash through dividend Creating value an
Slide 21: Outlook 2016/17 – Continuing Operations Basis
Outlook 2016/17* – Continuing Operations Basis Metric 2015/16 2016/17e Turnover €17,185m ~3% growth Underlying EBITA €1,001m At least 10% growth ~€100m Adjustments €102m (increased from ~€80m) ~€140m Net Interest €180m (reduced from ~€160m) Net Capex & Investments** €642m ~€1bn Net Cash/Debt €32m ne
Slide 22: Summary
SUMMARY 22 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 23: Summary
Summary The Group has delivered Summer 2017 continues to trade Continuing to deliver our transformation, a good H1 overall in line with our expectations focussed on growth of own hotel and cruise brands and driving further value from our source markets Our strategy, operational experience and Based
Slide 24: Q&A
Q&A 24 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 25: Appendix
APPENDIX 25 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 26: 2016/17 H1 Turnover by Segment
2016/17 H1 Turnover by Segment (excludes Intra-Group Turnover)* In €m H1 16/17 H1 15/16 Change FX Change ex FX Northern Region 2,232.9 2,358.3 -125.3 -266.2 140.9 Central Region 2,028.0 1,987.1 40.9 0.5 40.4 Western Region 1,114.0 915.6 198.3 0.2 198.1 Source Markets 5,374.9 5,261.0 113.9 -265.5 379
Slide 27: 2016/17 H1 Underlying EBITA by Segment
2016/17 H1 Underlying EBITA by Segment* In €m H1 16/17 H1 15/16 Change FX Change ex FX Northern Region -138.0 -120.9 -17.1 23.9 -41.0 Central Region -143.7 -110.6 -33.1 -0.1 -33.0 Western Region -102.2 -75.7 -26.5 - -26.5 Source Markets -383.9 -307.2 -76.7 23.8 -100.5 Riu 175.2 153.6 21.6 -4.9 26.5
Slide 28: 2015/16 Restated Turnover by Quarter
2015/16 Restated Turnover by Quarter (excludes Intra-Group Turnover)* In €m Q1 2015/16 Q2 2015/16 Q3 2015/16 Q4 2015/16 FY 2015/16 Northern Region 1,188.2 1,170.1 1,661.7 2,575.0 6,595.0 Central Region 1,089.4 897.7 1,346.4 2,229.4 5,562.9 Western Region 486.9 428.7 734.6 1,219.7 2,869.9 Source Mark
Slide 29: 2015/16 Restated Underlying EBITA by Quarter
2015/16 Restated Underlying EBITA by Quarter* In €m Q1 2015/16 Q2 2015/16 Q3 2015/16 Q4 2015/16 FY 2015/16 Northern Region -42.8 -78.1 71.9 432.1 383.1 Central Region -27.0 -83.6 3.5 192.2 85.1 Western Region -27.7 -48.0 -6.4 168.2 86.1 Source Markets -97.5 -209.7 69.0 792.5 554.3 Riu 59.2 94.4 64.6
Slide 30: Deliver Merger Synergies
Deliver Merger Synergies Per Capital Markets Realised to FY16 Realised to H1 FY17 Update May 2015 Synergies One-off Synergies One-off Synergies One-off costs costs costs In €m to achieve to achieve to achieve Corporate 50 35 40 35 50 35 streamlining Occupancy 30 - 30 - 30 - improvement Destination 2
Slide 31: Adjustments
Adjustments In €m H1 16/17 H1 15/16 Restructuring expense -17.1 -5.5 Loss on disposals -0.7 -0.9 Other one-off items -4.6 -10.5 PPA -15.2 -17.6 Total Adjustments -37.6 -34.5 31 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 32: Net Interest Result
Net Interest Result In €m H1 16/17 H1 15/16 Debt related interest -54 -57 Non-debt related charge -15 -35 Interest income 8 10 Net interest result -61 -82 o/w cash interest -30 -41 32 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 33: Movement in Net Debt
Movement in Net Debt In €m 31 Mar 2017 31 Mar 2016 Opening net (debt)/ cash as at 30 350 -214 September Movement in cash net of debt -1,382 -1,190 Other cash movement - employee benefit -21 -51 trust Foreign exchange movement -54 63 Non cash movement in debt - Asset backed -6 -10 finance Non cash mo
Slide 34: Net Financial Position, Pensions and Operating Leases
Net Financial Position, Pensions and Operating Leases In €m 31 Mar 2017 31 Mar 2016 Financial liabilities -2,027 -2,505 - Finance Leases -1,230 -939 - High Yield Bond - -294 - Senior Notes -295 - - Other liabilities (incl RCF) -502 -1,272 Cash 623 926 Net debt -1,404 -1,579 - Net Pension Obligation
Slide 35: Hotels & Resorts KPIs H1 2016/17
Hotels & Resorts KPIs H1 2016/17 CAPACITY1 REVENUE/BED2 OCCUPANCY3 UNDERLY. EBITA4 y-o-y (%) (`000 y-o-y (%) (€) y-o-y (ppts) (%) y-o-y (€m) (€m) ) Flat 8,383 7 69.3 1 88 22 175 2 1,167 3 93.2 -1 62 5 1 OTHER Flat -53 TUI H&R 2 14,288 5 64.7 -1 75 27 123 1 Group owned or leased hotel beds multiplied
Slide 36: Hotels & Resorts Blue Diamond – Key Figures 2015/16
Hotels & Resorts Blue Diamond – Key Figures 2015/16 (€M) HOTEL LOCATIONS Blue Diamond 100% view Total 2 Cuba Turnover 312 3 Jamaica EBITA 51 21 1 Bahamas EBITA margin 16% Hotels 1 14 Dom Rep EAT 34 Mexico o/w EAT to TUI (49%) 17 CAPACITY & OCCUPANCY FINANCING STRUCTURE (%) Var % ppts Abs. 5% Bed Nig
Slide 37: Cruises KPIs H1 2016/17
Cruises KPIs H1 2016/17 PASSENGER CRUISE DAYS AVERAGE DAILY RATE OCCUPANCY UNDERLY. EBITA y-o-y (%) (`000 y-o-y (%) (€) y-o-y (ppts) (%) y-o-y (€m) (€m) ) 24 2,032 Flat 147 -1 100 8 38* 28 1,090 9 161** 2 100 12 22 -2 164 6 595 5 15 -1 74 * Equity result **Inclusive of transfers, flights and hotel c
Slide 38: Cruises Thomson Cruises - Key Figures 2015/16
Cruises Thomson Cruises - Key Figures 2015/16 Turnover and Earnings (€m) FY16 Turnover 406 OWNERSHIP 100% Underlying EBITA 61 INTEGRATION • Within Thomson (UK Source Market) Passenger cruise days (‘000) 2,081 • ~100% Thomson Airways Occupancy (%) 100.6 Average rate (€) 161 PRODUCT • UK leader in fly
Slide 39: Source Markets KPIs H1 2016/17
Source Markets KPIs H1 2016/17 CUSTOMERS DIRECT DISTRIBUTION ONLINE UNDERLY. EBITA y-o-y (%) (`000) y-o-y (ppts) (%) y-o-y (ppts) (%) y-o-y (€m) (€m) 5 2,363 Flat 90 4 63 -17 -138 Northern Region* Central Region -3 2,146 2 47 3 17 -33 -144 -€24m relates to TUI fly sickness Western Region* 10 1,835 3
Slide 40: Source Market H1 KPIs by country
Source Market H1 KPIs by country1 Direct Distribution Online Distribution Customers (000) H1 16/17 H1 15/16 H1 16/17 H1 15/16 H1 16/17 H1 15/16 UK 91% 91% 59% 57% 1,784 1,654 Nordics 89% 89% 75% 71% 579 596 Germany2 47% 43% 17% 14% 1,980 2,079 Benelux 75% 72% 61% 56% 1,559 1,520 Total Source Markets
Slide 41: Source Markets Current Trading – Summer 2017
Source Markets Current Trading – Summer 2017 CURRENT TRADING1 REVENUE CUSTOMERS ASP PROGRAMME SOLD Y-O-Y VARIATION (%) 8 65% UK (excl. Thomson Cruises) 8 Flat Nordics 8 3 5 58% Germany 7 4 3 62% Benelux 3 7 3 61% Source Markets 8 4 4 62% 1These statistics are up to 7 May 2017 and shown on a constant
Slide 42: Key Sources of Funding March 2017
Key Sources of Funding 31 March 2017 Interest % Instrument Issue Maturity Amount €m p.a.* Revolving Credit Facility Sep 14 Dec 20 1,750** E/L +1.40 Senior Notes Oct 16 Oct 21 300 2.125 Finance *Upgrade leases of our rating Various by S&P has reduced our RCF interest margin from 1.55% Various to 1.40
Slide 43: Aircraft Commitments by Financing Type
Aircraft Commitments by Financing Type Operating Lease* Finance Lease Owned Total As at 30 September 2016 125 16 8 149 Order book financing - - - - External Lessor deliveries 1 - - 1 External Lessor Returns (1) - - (1) As at 31 March 2017 125 16 8 149 * Includes aircraft leased from and operated on
Slide 44: Aircraft order book deliveries – FY 2017 to FY 2021
Aircraft order book deliveries – FY 2017 to FY 2021 16/17 17/18 18/19 19/20 20/21 B737 NG - - - - - B737-MAX - 5 18 18 12 B787-8 - - - - - B787-9 1 2 - 2 - Firm order book deliveries 2017-2021 1 7 18 20 12 Financial Years (FY) ending 30 September; figures correct as at 31 March 2017 In addition to t
Slide 45: Financial Calendar 2017
Financial Calendar 2017 15 MAY 2017 10 AUGUST 2017 28 SEPTEMBER 2017 13 DECEMBER 2017 Q2 2016/17 9M 2016/17 PRE-CLOSE ANNUAL REPORT REPORT REPORT TRADING UPDATE FOR FINANCIAL YEAR 2016/17 45 TUI GROUP | H1 2016/17 Results | 15 May 2017
Slide 46: Contact
Contact Contacts for Analysts and Investors in UK, Ireland and Americas Sarah Coomes, Head of Investor Relations Tel: +44 (0)1293 645 827 Hazel Chung, Investor Relations Manager Tel: +44 (0)1293 645 823 Contacts for Analysts and Investors in Continental Europe, Middle East and Asia Nicola Gehrt, Hea