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BERLINThe German leisure operator Tui Group has recorded a €3bn loss after the Covid-19 pandemic forced the company to slash its holiday and cruise itineraries and seek financial support from the German government.
The tour operator, which also revealed €4.2bn net debt, said on Thursday that it had managed to increase cost savings from €300m to €400m as it scrambled to slim down its asset-heavy structure in order to cope with the fallout from the crisis.

Revenues in the year to the end of September fell 58 per cent to €7.9bn, resulting in a €3.2bn pre-tax loss, down from a profit of €692m in 2019.

Last week, it secured a €1.8bn financing deal from a consortium of investors, banks, and Germany’s state-backed economic support fund.

As part of the funding Tui’s largest shareholder, the Russian businessman Alexei Mordashov, will increase his 25 percent stake in the business. It is Tui’s third government-backed financing since the crisis began, bringing the total to €4.8bn.

The group had €2.5bn of cash on its balance sheet at the end of November. It has fixed costs of €250m to €300m and said it had paid out about €140m in customer refunds over the summer.

Tui, which has a fleet of roughly 150 aircraft and 17 cruise ships, has struggled more than nimble online rivals such as Love Holidays and On The Beach to cope with the fallout from frequently changing travel advice that has resulted in holiday cancellations and the knock-on hit to consumer confidence.

It normally carries roughly 21m travelers on holiday each year — a number that fell to 8.1m in the year to the end of September.#
Via (Financial Times)

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