Presentation Media Call 13 May 2015 Taking TUI to the next level: The World s Leading Tourism Business
H1 results 2
TUI Group with strong H1 performance 14% improvement in underlying 1 EBITA Source markets in line with expectations Underlying EBITA improved to a seasonal loss of - 273m (H1 2013/14: -341m) Includes 16m profit on sale of Riu Waikiki; 14m Easter impact, the favourable new financing for Europa 2 and 2m adverse foreign exchange translation Source Markets improved operating loss to -265m (H1 2013/14: -271m) with good performance in Northern and Western Region Strong performance in Hotels & Resorts as well as Cruises Underlying EBITA of Hotels & Resorts improved to 35m (H1 2013/14: 33m) including former TUI Travel hotels; excluding 16m profit on sale of Riu Waikiki & favourable foreign exchange translation Cruises increased profitability to 13m, up 29m, excluding financing for Europa 2 Remain confident of delivering full year underlying operating profit growth of 10% to 15% at constant currency 1 excluding profit on sale of Riu Waikiki, Europa 2 refinancing benefit and foreign exchange translation 3
We ve strongly improved our Underlying EBITA Underlying EBITA H1 2014/15 bridge ( m) 4
Strategy update 5
Member of the* Group Executive Committee Executive Board We are becoming more agile and competitive through flatter hierarchy Friedrich Joussen Peter Long Horst Baier Sebastian Ebel Will Waggott David Burling Joint CEO Joint CEO CFO Central Region Hotels & Resorts Cruises Inbound Services IT & Central Specialist & Activity Hotelbeds Group LateRooms Group Northern Region Hotel concepts Aviation Elie Bruyninckx Thomas Ellerbeck Erik Friemuth Kenton Jarvis Dr. Hilka Schneider Western Region Group Director Corporate & External Affairs Group Chief Marketing Officer Group Director Controlling and FD Tourism Group Director Legal, Compliance & Board Office *Christian Clemens will be a member of the Group Executive Committee until his resignation as CEO TUI Deutschland at the end of this year 6
We create a clear structure to deliver growth and value Tourism Business Other Businesses Northern Region Hotels & Resorts Hotelbeds Group Specialist & Activity Central Region Cruises Western Region Inbound Services (from 2015/16) Platforms (aviation & customer/it) LateRooms Group Held for sale Hapag-Lloyd AG 7
The World s Leading Tourism Business Accommodation >7m customers Inbound Service 11m customers Integrated platforms Integrated management Marketing & Sales >20m customers Flight 13m customers Strong positions in all parts of the value chain Business risk minimised through integrated decision making From growing profits to profitable growth Customer numbers based on 2013/14, including JVs. Marketing & Sales includes Northern Region, Central Region and Western Region; Flight includes Corsair and TUIfly passengers flown for Air Berlin; Inbound Service relates to in-house customers only; Accommodation includes former TUI AG hotels and cruise customers, former TUI Travel hotels customers and Blue Diamond (Canadian JV) customers 8
Marketing & Sales We will operate our business throughout Europe with one brand* If we set up our company today we would build it on one brand If we fast forward into the future one brand would be necessary to compete, particularly online We will ensure that we don t lose the benefits of our local brand equity * The implementation takes place with respect for all interests of third parties and existing contractual obligations 9
Phase 2 Phase 1 Marketing & Sales We are starting our brand migration process right now* NL FR BE Introduce TUI Phased approach allows transfer of best practice and enables us to minimise risk Nordics UK Supporting Workstreams Airline rebranding, destination & airport rebranding, external & internal communication, IT migration * The implementation takes place with respect for all interests of third parties and existing contractual obligations 10
Flight We operate Europe s 7 th largest airline fleet 59 aircraft 8 aircraft 10 aircraft 29 aircraft 22 aircraft Aircraft numbers as at 31 September 2014; TUIfly excludes aircraft leased out to Air Berlin; Corsair excluded from above figures 11
Central Platform Flight We will implement a central platform with local airlines Organisational structure Business model / ways of working Scale Local airlines One central organisation across 5 AOC s One engineering & maintenance function Full interoperability among fleet & crew One IT landscape serving all AOCs Fully joint long-haul planning to optimised utilisation Common fleet deployment & capacity planning process One procurement organisation leveraging scale on all contracts Common supply chain & process Crew rostering Flight planning Delivering operational efficiency improvement 12
Inbound Service We will integrate all our reps into one organisation Over 6,500 employees Transport One organisation Transfers 11m customers Service Excursions Handling 109 destinations Being fully integrated within Tourism Delivering our differentiation strategy in all destinations Customer experience Increase NPS and CSQ Cost Reduce cost of sales & overheads Sales Increase sales & margin People engagement Increase engagement scores Bringing World of TUI to life Figures shown relate to Inbound Services business which is being moved from Hotelbeds Group to Tourism 13
Accommodation We grow with our strong Hotel and Club Brands Hotels Clubs Brand Strategy Footprint (30/9/14) Continue to grow the highly profitable brand Nth Africa Caribbean Other Med Our new brand : New hotels plus repositioning of some existing brands Distribution ~50% through TUI >75% through TUI Other Nth Africa Expand & internationalise the club product Med Nth Africa Med 95% through TUI Targeting ~60 new hotels by 2018/19 14
Accommodation We will achieve profitable growth in our Cruise business Brand Fleet Structure Customer Proposition 4* (+2 on order) JV with Royal Caribbean Premium all-inclusive, German-speaking 5 Part of Northern Region Wide range of great value cruises 4 Subsidiary Luxury & expedition cruising Cruise company management to become more integrated over time *Fleet includes Mein Schiff 4 (delivers June 2015) 15
Other businesses We run this businesses independently to maximise growth and value Hotelbeds Group Specialist & Activity LateRooms Group Hapag-Lloyd AG Optimise strategic future through standalone operation Run as independent business Inbound Services being integrated into Tourism Evaluating our options Portfolio of businesses Run independently and managed for value Held for sale Held for sale 16
We are taking TUI to the next level The World s Leading Tourism Business Merger integration ahead of our original plan - we are working well together New organisation structure in place - a flatter, more agile structure Strong and sustainable business model with exciting growth prospects 10-15% EBITA growth this year At least 10% CAGR over the next three years Committed to progressive dividend growth Well positioned to deliver underlying EBITA CAGR of at least 10% over the next three years 17
Q&A