Cruise Business Drives TUI’s Earnings Up
- Business & Finance
The cruises segment was one of the growth drivers for Germany-based TUI Group in 2017, which was another positive year for the group.
Despite a challenging market environment, TUI increased its underlying EBITA by 12 percent to EUR* 1.1 billion from EUR 1 billion seen in 2016.
In addition, the group delivered turnover growth of 11.7 percent. The turnover rose to EUR 19.2 billion in 2017 from EUR 17.2 billion recorded in 2016.
“For the third consecutive year, we have delivered double-digit growth in our operating result. More than half of our earnings are delivered by TUI’s hotel and cruise companies. Our successful strategic realignment is also clearly reflected in our set of results. Thanks to the strong growth of our hotel and cruise brands, TUI now delivers stronger margins and is less seasonal,” Fritz Joussen, TUI CEO, said at the presentation of the results for financial year 2017 – October 1, 2016, to September 30, 2017 – in London.
“Our business profile is now much more evenly structured across the entire year. The clear focus on investments in high-margin hotels and ships was the core of the strategy for the new TUI following the merger in 2014,” Joussen added.
Since the first half of financial year 2017, the cruises segment has comprised the results of all three cruise companies – TUI Cruises, Marella Cruises (formerly Thomson Cruises) and Hapag-Lloyd Cruises. In the period under review, the segment delivered a 33.9 percent growth in underlying EBITDA, which increased to EUR 255.6 million from EUR 190.9 million.
In June 2017, Mein Schiff 6 joined TUI Cruises’ fleet and in 2018, the new Mein Schiff 1 will be launched.
Additionally, the Marella Cruises’ fleet has continued with its modernization – in the period under review, it launched Marella Discovery 2.
As explained, the fleet operated by TUI’s subsidiary Hapag-Lloyd Cruises will also be expanded and modernized in the medium term. In calendar year 2019, the newbuilds Hanseatic nature and Hanseatic inspiration will join the fleet.
* EUR 1 equals USD 1.17 as of December 13.