Tui Ag · XETR:TUI1
Tui — H1 2023 Earnings Presentation
44 slides from Tui's earnings presentation, May 10, 2023
Slide 1: FY23 Q2/H1 Results
FY23 Q2/H1 RESULTS 10 May 2023
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 FY23 Q2/H1 Highlights & Trading Update 2 FY23 Capital Increase & Q2/H1 Results 3 Summary – Update Strategic Initiatives 4 Appendix
Slide 4: Opening remarks – encouraging booking momentum underlines expectations for a strong Summer
Opening remarks – encouraging booking momentum underlines our expectations for a strong Summer Improved Winter season delivered in line with expectations, not yet fully back to pre-pandemic levels Easter confirmed strong customer demand across all our markets and for our hotels, cruise and experienc
Slide 5: Q2 delivers strong improvement vs. prior year - successful completion of €1.8bn capital increase
Q2 delivers strong improvement vs. prior year - successful completion of €1.8bn capital increase • 2.4m customers enjoyed holidays in the quarter, +0.6m, (88% of FY19 LFL levels), achieving airline load factors of 93% • Q2 Revenue €3.2bn, improving significantly by €1.0bn • Q2 Und. EBIT -€242m, impr
Slide 6: HEX Und. EBIT up €148m vs. PY
HEX Und. EBIT up €148m vs. PY - Strong performance in Hotels, Cruises again positive HOLIDAY EXPERIENCES Und. EBIT €80m (+€148m vs. PY) FY23 Q2 FY22 Q2 FY19 Q2 78 65 Q2 YoY Avail. Bednights: 7.0m +1% HOTELS & 24 RESORTS Occupancy: 83% +18%pts Ave. daily Rate1: €100 +16% 59 Q2 YoY 15 Avail. Pax Days
Slide 7: M&A +€47m vs. PY adjusting for state aid and hedging ineffectiveness
M&A +€47m vs. PY adjusting for state aid and hedging ineffectiveness MARKETS & AIRLINES +€47m Und. EBIT -€309m (-€46m vs. PY) Adj. vs. PY FY23 Q2 FY22 Q2 FY19 Q2 +47 Q2 YoY Departed pax: 2.4m +30% TOTAL M&A -262 Load Factor: 93% +9%pts -300 -309 -356 PY exceptionals +€94m • Reversal of PY +€50m Covi
Slide 8: M&A almost back to 2019 levels
M&A almost back to 2019 levels MARKETS & AIRLINES Und. EBIT -€309m (-€9m vs. FY19 Q2) FY23 Q2 FY19 Q2 • Revenue with €2.7bn, NORTHERN 8% above 2019 levels REGION based on strong ASP -121 -148 • Und. EBIT almost back to 2019 levels, despite CENTRAL REGION volumes still recovering -102 -87 and impact
Slide 9: Markets & Airlines – Winter 22/23 closed out in line with expectations
Markets & Airlines – Winter 22/23 closed out in line with expectations and pricing well ahead • 4.7m bookings for Winter 22/23 with 0.6m added since FY23 Q1 Update • Bookings up strongly +33% (-12% vs. W18/19) with ASP well ahead at +10% (+29% vs. W18/19) vs. Winter 21/22 • TUI well positioned in sh
Slide 10: Markets & Airlines – S23 Bookings +13% vs. PY
Markets & Airlines – S23 Bookings +13% vs. PY with continued strong booking momentum, capacity expected to be close to normalised levels S23 Cumulative Net bookings as % of S22 Vs S22 Vs S19 S23 L6W S23 8.3m bookings, +3.6m since FY23 Q1 BOOKINGS1 +13% -1% -4% 140% ASP +5% 8% LFL* +8% +26% * Exclude
Slide 11: Markets & Airlines – Booking momentum remains strong in the L6Ws
Markets & Airlines – Booking momentum remains strong in the L6Ws at +6% vs. S19 at higher prices S23 Net weekly bookings as % of S19 by market Summer 23 UK 150 +6% L6Ws 150 +6% L6Ws 117 110 113 108 109 103 104 102 108 103 100 101 100% 100% 50 50 0 0 26.03. 02.04. 09.04. 16.04. 23.04. 30.04. 26.03. 0
Slide 12: FY23 Trading: Positive momentum continues
FY23 Trading: Positive momentum continues HOLIDAY EXPERIENCES Versus 2022 23 H21 Trading Environment HOTELS & • Booked Occ. % in H2 slightly ahead of PY at 57% (PY 54%) Avail. Bed Nights2 +5% RESORTS • Ave. Daily Rate in H2 ahead of PY by 8%, mainly driven by RIU • Turkey, Caribbean, Balearics, Gree
Slide 13: Agenda
AGENDA 1 FY23 Q2 Highlights & Trading Update 2 FY23 Capital Increase & Q2/H1 Results 3 Summary – Update Strategic Initiatives 4 Appendix
Slide 14: Achievements post Q1 Successful €1.8bn Capital Increase
Achievements post Q1 1 2 Successful €1.8bn FY23 Q2 Capital Increase Strong Operational Improvement on PY • Full repayment of WSF State Aid • Revenue €3.2bn +€1.0bn • Reduction of KfW RCF to €1.1bn – undrawn buffer • Und. EBIT -€242m +€88m (+€181m Adj.1) • Significant balance sheet progress • Net Deb
Slide 15: Capital increase impact on balance sheet
Capital increase impact on balance sheet Capital increase assumed to deliver a pro-forma Net Overall structure & implications Leverage Ratio below FY19 level in €bn Sources & Uses Net Debt Net Debt Proceeds +1.8 3.4 FY22 Q4 Excl. Boeing MAX In addition, SP I cost impact 1.4x2 repaid 2.8x Warrant Bon
Slide 16: Capital increase to support sustainable leverage ratio
Capital increase to support sustainable leverage ratio Capital increase to accelerate Gross Leverage Ratio1 down to ~3.0x Mid-term ambitions In addition, SP I • Leverage ratio of well below repaid 3x in line with 2025/26 mid- Excl. Boeing MAX term ambitions cost impact 2.7x2 4.7x 4.1x 3.0x ~3.0x 3.0
Slide 17: Income Statement
Income Statement Und. EBIT Q2 delivers a strong improvement compared to PY REVENUE In €m FY23 Q2 FY22 Q2 FY23 H1 FY22 H1 • Q2 revenue at €3.2bn, up 48% on Q2 FY22, following return to more normalised environment with 2.4m Markets & Airlines passengers departing, up 30% on Q2 Revenue 3,153 2,128 6,90
Slide 18: Q2 result – Strong improvement vs. prior year
Q2 result – Strong improvement vs. prior year, excl. exceptionals up €181m with all segments contributing FY23 Q2 vs. FY22 Q2 UNDERLYING EBIT IN €M +181m Holiday Experiences: +€148m • Hotels & Resorts 7.0m avail. bednights, up 0.1m YoY (+1%) and occupancy 83%, up 18%pts. • Cruises 2.4m avail. passen
Slide 19: FY23 Q2 Free Cash flow mainly driven by Working Capital inflow
FY23 Q2 Free Cash flow mainly driven by Working Capital inflow WORKING CAPITAL In €m FY23 Q2 FY22 Q2 FY23 H1 FY22 H1 • Strong inflow from customer prepayments for summer bookings & continued Underlying EBITDA -43 -123 15 -188 discipline Adjustments 0 -7 0 3 Reported EBITDA -43 -130 15 -185 AT EQUITY
Slide 20: Pro-forma net debt of €3.1bn post rights-issue
Pro-forma net debt of €3.1bn post rights- issue – €1.1bn improvement FY23 H1 vs FY22 H1 In €m FY23 H1 FY22 H1 IFRS 16 IFRS 16 YoY ∆ Financial liabilities -5,829 -5,572 -256 - Lease liabilities under IFRS16 -2,835 -3,146 312 - Bond with warrant -61 -149 88 - Convertible Bond -537 -527 -10 - Liabiliti
Slide 21: FY23 Modelling Assumptions per 10 May 2023
FY23 Modelling Assumptions per 10 May 2023 (post capital increase) FY23e1 FY22 Revenue2 Expect further strong increase in Revenue €16,545m Underlying EBIT2 Expect Und. EBIT to increase significantly €409m Adjustments -€40m to -€60m (Prior: -€60m to -€80m) -€89m (incl. PPA)3 Expect towards lower end
Slide 22: CFO priorities – ongoing capital structure development
CFO priorities – ongoing capital structure development Support Profitable Growth Cash Flow Focused Strengthen Balance Sheet • Support further • Strict cost discipline • Optimise maturity profile & transformation • Focus on WC, capex & cash interest expenses • Implement ESG initiatives from operation
Slide 23: Agenda
AGENDA 1 FY23 Q2/H1 Highlights & Trading Update 2 FY23 Capital Increase & Q2/H1 Results 3 Summary – Update Strategic Initiatives 4 Appendix
Slide 24: Our New Vision for TUI – Excellence in Leisure Experiences
Our New Vision for TUI – “Excellence in Leisure Experiences” 24
Slide 25: The New TUI Vision
The New TUI Vision TUI enriches lives through travel & leisure experiences. TUI Vision Powered by our unrivalled combination of product, technology & people, In a paragraph we create distinctive leisure experiences that open up the world responsibly and advance our position as pioneers in the market
Slide 26: Q2 Update on our strategic initiatives
Q2 Update on our strategic initiatives TUI targeting growth in Dynamic packaging, Acco/Flight-only, Cars, Tours & Experiences Expansion of TUI Flight Market Place Ancillaries growth Continued B2C sales growth in TUI Musement Platform rollout supports TUI BLUE asset light growth Sustainability Update
Slide 27: New & existing customers: Expansion of Flight Only
New & existing customers: Expansion of Flight Only Creating TUI Flight Market Place (TFM) TFM taking Flight Only offering to the next level • Development of Flight Only both in B2B and B2C business • Full integration of Flight Only product offering in TUI App • Already rolled out in Central and key
Slide 28: Ancillaries: Growth delivery & further potential
Ancillaries: Growth delivery & further potential ADDED-VALUE PRODUCTS WHICH HELP • One of the largest portfolios of extras covering the entire customer CUSTOMERS TO PERSONALISE THEIR journey HOLIDAY WITH EASE • Integration in all channels (App, TUI.com, Retail, MyTUI) BEFORE YOU GO AIRPORT EXTRAS •
Slide 29: New Customers: TUI Musement continued B2C Sales growth
New Customers: TUI Musement continued B2C Sales growth • Launch of tuiexperiences.com to drive growth of experience sales direct to consumer • Supports Group strategy by bringing new customers into the TUI ecosystem • +185% YoY growth for B2C experiences sold in Q2 • Increased focus on city experien
Slide 30: Digital platform rollout supports TUI BLUE asset light growth
Digital platform rollout supports TUI BLUE asset light growth – 14 new hotels across 4 continents starting Summer 2023 TUI BLUE HOTEL PIPELINE • TUI Blue is our modern hotel brand with great appeal to experience-oriented lifestyle travellers • Five new openings in Summer 2023 on the Balearic Islands
Slide 31: Q2 Sustainability Update
Q2 Sustainability Update 2030 targets approved by SBTi • Target 24% reduction in airline CO2e per rpk* • Target 27.5% reduction in absolute C02e from cruise • Target 46.2% reduction in absolute C02e from TUI Hotels & Resorts • New agreement in place with Shell on sustainable aviation fuel to promote
Slide 32: UK FY24 Capacity Expansion – 1.1m extra flight seats
UK FY24 Capacity Expansion – 1.1m extra flight seats, enhancing dynamic offer • Over a million extra flight seats and 1,500 hotels added for our biggest summer ever with unrivalled operation from over 20 regional airports • Providing more flexibility & choice for our customers • Increased frequency
Slide 33: Clear mid-term strategy to capture future market growth potential
Clear mid-term strategy to capture future market growth potential - Grow market share, New products & New customers Accelerate profitable growth OUR FY23 ASSUMPTIONS With new customer segments & more product sales ➢ Revenue1 expected to further increase strongly ➢ Und. EBIT1 expected to increase sig
Slide 34: Appendix
APPENDIX
Slide 35: FY23 Q2 Revenue by Segment
FY23 Q2 Revenue by Segment (excludes Intra-Group Revenue and JVs/associates)1 FY23 Q2 FY22 Q2 Change Change In €m FX IFRS 16 IFRS 16 incl FX ex FX Hotels & Resorts 218.3 181.0 37.4 12.6 24.8 - Riu 185.0 152.0 33.0 13.0 20.0 - Robinson 18.8 18.1 0.7 0.0 0.7 - Blue Diamond2 - - - - - - Other 14.6 10.9
Slide 36: FY23 Q2 Underlying EBITDA by Segment
FY23 Q2 Underlying EBITDA by Segment1 FY23 Q2 FY22 Q2 Change Change In €m FX IFRS 16 IFRS 16 incl FX ex FX Hotels & Resorts 123.6 68.0 55.6 -0.8 56.4 - Riu 112.9 66.4 46.5 5.9 40.6 - Robinson -1.8 -1.4 -0.3 0.2 -0.6 - Blue Diamond2 27.1 20.8 6.3 1.1 5.2 - Other -14.7 -17.9 3.2 -8.0 11.2 Cruises 33.0
Slide 37: FY23 Q2 Underlying EBIT by Segment
FY23 Q2 Underlying EBIT by Segment1 FY23 Q2 FY22 Q2 Change Change In €m FX IFRS 16 IFRS 16 incl FX ex FX Hotels & Resorts 78.0 23.7 54.4 -1.3 55.6 - Riu 86.9 44.0 42.9 4.9 38.0 - Robinson -10.8 -10.3 -0.5 0.2 -0.7 - Blue Diamond2 27.1 20.8 6.3 1.1 5.2 - Other -25.2 -30.9 5.7 -7.5 13.2 Cruises 14.8 -
Slide 38: FY23 H1 Revenue by Segment
FY23 H1 Revenue by Segment (excludes Intra-Group Revenue and JVs/associates)1 FY23 H1 FY22 H1 Change Change In €m FX IFRS 16 IFRS 16 incl FX ex FX Hotels & Resorts 429.2 379.3 49.9 25.3 24.6 - Riu 359.0 314.4 44.6 25.6 19.0 - Robinson 41.6 38.7 2.9 0.2 2.7 - Blue Diamond2 - - - - - - Other 28.6 26.2
Slide 39: FY23 H1 Underlying EBITDA by Segment
FY23 H1 Underlying EBITDA by Segment1 FY23 H1 FY22 H1 Change Change In €m FX IFRS 16 IFRS 16 incl FX ex FX Hotels & Resorts 245.3 175.0 70.3 -1.5 71.9 - Riu 203.0 152.7 50.3 10.4 39.9 - Robinson 15.0 9.3 5.6 0.5 5.1 - Blue Diamond2 31.6 25.6 6.0 1.2 4.8 - Other -4.3 -12.7 8.4 -13.7 22.1 Cruises 50.9
Slide 40: FY23 H1 Underlying EBIT by Segment
FY23 H1 Underlying EBIT by Segment1 FY23 H1 FY22 H1 Change Change In €m FX IFRS 16 IFRS 16 incl FX ex FX Hotels & Resorts 149.7 84.8 64.9 -3.2 68.1 - Riu 150.4 106.1 44.3 8.0 36.3 - Robinson -3.2 -8.9 5.7 0.4 5.2 - Blue Diamond2 31.6 25.6 6.0 1.2 4.8 - Other -29.1 -38.0 8.9 -12.9 21.8 Cruises 15.0 -
Slide 41: Financing facilities and support packages overview per 31 March 2023
Financing facilities and support packages overview per 31 March 2023 Support Facility Instrument Utilisation €m Debt/equity Maturity date package # €m - 1,454 1,439m drawn Debt RCF Bank - 190 guarantee line - July 2024 (unsecured) facilities 1&2 2,1001 undrawn Debt Schuldschein - 425 - Debt July 202
Slide 42: Movement in Net Debt
Movement in Net Debt FY22 H1 to FY23 H1 In €m FY23 H1 FY22 H1 In €m FY23 H1 FY22 H1 IFRS 16 IFRS 16 YoY ∆ IFRS 16 IFRS 16 YoY ∆ Opening net debt as at 1 October -3,436 -4,954 1,518 Financial liabilities -5,829 -5,572 -256 FCF after Dividends -747 129 -876 - Lease liabilities under IFRS16 -2,835 -3,1
Slide 43: Movement in Net Debt
Movement in Net Debt FY23 Q1 to FY23 H1 In €m FY23 H1 FY23 Q1 In €m FY23 H1 FY23 Q1 IFRS 16 IFRS 16 QoQ ∆ IFRS 16 IFRS 16 QoQ ∆ Opening net debt as at 1 October -3,436 -3,436 - Financial liabilities -5,829 -6,888 1,059 FCF after Dividends -747 -1,959 1,212 - Lease liabilities under IFRS16 -2,835 -2,
Slide 44: Analyst and Investor Enquiries
ANALYST AND INVESTOR ENQUIRIES Nicola Gehrt, Group Director Investor Relations Tel: +49 (0)511 566 1435 Adrian Bell, Senior Investor Relations Manager Tel: +49 (0)511 566 2332 James Trimble, Investor Relations Manager Tel: +44 (0)1582 315 293 Stefan Keese, Investor Relations Manager Tel: +49 (0)511