TUI AG, the German owner of Europe's largest travel business, yesterday reported a second-quarter loss on costs to merge its tourism brands and lease aircraft.
The loss of 55.6 million euros (US$82.9 million), or 24 cents a share, compares with a profit of 58.9 million euros, or 19 cents, a year earlier, Hanover-based TUI said. That beat the median estimate of five analysts surveyed by Bloomberg News, which predicted a loss of 73.9 million euros. Sales rose 20 percent to 6.25 billion euros.
TUI, which also owns the Hapag-Lloyd shipping line, repeated that it expects "substantial" earnings growth from tourism this year, without being more precise.
TUI is combining its Thomson and First Choice brands and absorbing acquisitions following the merger that created its publicly traded, United Kingdom-based subsidiary TUI Travel Plc last year.
"Acquisitions are being integrated successfully and are on track to deliver targeted synergies," John Mattimoe, an analyst at Merrion Stockbrokers in Dublin, wrote in a note yesterday.
Smaller rival Thomas Cook Group Plc yesterday reported a narrower operating loss after maintaining vacation prices.
Besides TUI Travel, TUI AG owns hotels and cruise ships.
Tourism sales both inside and outside the UK subsidiary rose 28.3 percent to 4.72 billion euros. The company had 231 million euros of one-time costs in its tourism business. Excluding them, operating profit rose.
TUI reduced debt to 3.1 billion euros as of June 30 from 3.9 billion euros a year earlier, according to the statement.
