TUI sees losses more than double after heatwave hit

Business environment 'challenging'
Business environment 'challenging'

Holiday giant Tui has blamed last year’s “unusually long and hot summer” and the weak pound as first-quarter losses more than doubled.

The group - which last week sent shares tumbling after warning over full-year profits - reported seasonal underlying losses of f83.6 million (£73.3m) for the three months to December 31 against losses of f36.7m (£32.2m) a year earlier.

It said results were impacted by last year’s prolonged hot weather across northern Europe, combined with the Brexit-hit pound and overcapacity in western Mediterranean destinations, such as the Canary Islands.

The group said summer 2019 bookings were “broadly” in line with a year earlier and holiday prices had held firm, but cautioned its profit margins were taking a hit.

“The market environment for all tour operators remains challenging,” it added.

Shares fell 5%, having tanked last week when Tui warned underlying earnings for the year to September 30 were expected to come in flat at around f1.17 billion (£1bn).

This compares with previous guidance for at least 10% growth in earnings.