Specialist
Former senior executive at Tui Deutschland GmbH
Agenda
- H2 2022 and post-summer bookings expectations and timeline for return to pre-coronavirus booking levels, assessing consumer behaviour through economic downturns
- Tui’s (ETR: TUI1) key points of differentiation vs low-cost operators and OTAs (online travel agencies)
- Tui’s unit economics outlook – hotelier inflation, fuel costs rising ASPs, working capital dynamics and cost-reduction opportunities
Questions
1.
What capacity do you expect to be booked for summer 2022 for Tui?
2.
Out of Tui’s 80-85% of normal capacity booked, how many bookings are new customers vs customers that booked and paid in 2020 and pushed it back?
3.
Do you think Tui can fill in the additional missing capacity for summer 2022 to return to 2019 levels?
4.
Would you expect Tui to supplement capacity in any way in summer 2022 for additional seats, as you mentioned they’re available?
5.
Looking ahead to summer 2023, would you say the 80-85% capacity is the new normal or would you expect Tui to reach 2019 capacity volumes soon?
6.
How would you assess consumer confidence and demand towards holidays? Are we starting to see any trends in deposit defaults or cancellations?
7.
What are your expectations for bookings in H2 2022 post-summer season? How would this compare to 2019 or a normal year?
8.
Could you share any expected volume capacity figures to compare the first half of winter to the second half?
9.
You mentioned some customers switching from a summer booking to winter. Have you observed this behaviour of people postponing their holidays to winter, and if so, what proportion?
10.
What percentage of capacity do you expect to have already been booked for winter? Are there any re-bookings from previous winters?
11.
What does our discussion mean for Tui’s working capital inflow and outflow for H2 2022?
12.
Do you expect Tui to have any liquidity challenges moving into the second half of winter, where you mentioned a more noticeable demand slowdown?
13.
You mentioned an average of 15-20% price increases. How much headroom is there to increase these further in H2 2022 and the winter season?
14.
How is the current booking cycle or curve structured if we think about winter and summer 2023? How does it compare to a pre-pandemic year?
15.
Have you observed any booking window trends? I’ve seen some reports around this shortening and more people booking last-minute holidays.
16.
Given there’s a bigger threat of additional coronavirus waves going into the winter months, would you expect a shorter bookings window for winter or is that not a possibility?
17.
How would you assess Tui’s move towards a franchise and managed hotel financing structure? Could you highlight any growth opportunities?
18.
What economics are you expecting on contracts in terms of fees and other factors? You mentioned higher hotelier costs.
19.
How reliant are Tui’s hotels on bed banks to supply capacity?
20.
Would you see the reliance on bed banks growing if Tui struggles to secure new management or franchise partners?
21.
How do you assess the performance of Tui’s Musement strategy division, including the digital transformation to date in terms of market competitiveness?
22.
What would Tui need to do to improve competitiveness in large cities? Is that possible?
23.
How competitive could Tui’s B2B Musement offering be?
24.
Tui management has disregarded the possibility of an IPO in the near-to-medium-term for the Musement division, but could this be a potential long-term option for the group?
25.
What do you believe are Tui’s key points of differentiation across its entire offering? Why would customers choose the company today post-pandemic vs a fractured booking across an OTA [online travel agency] or a low-cost airline?
26.
Could you outline Tui’s key cost drivers? What trends have you been seeing in these buckets?
27.
What magnitude of contract dollars does Tui typically secure yearly? You mentioned buying hotel arrangements in dollars.
28.
You mentioned Tui has 25-35% fuel volume hedged for summer 2022 and potentially 10% for summer 2023. When might fuel prices really hit the company’s ability to hedge?
29.
How feasible is Tui’s current cost-savings programme and what levers does the company have available to cut costs?
30.
Would you expect Tui to struggle at all with a potential talent drain? We’ve heard of labour shortages across the board.
31.
Tui raised a significant level of debt during the pandemic, so how would you assess the company’s debt burden today? What’s its next step?
32.
How would you assess Tui’s liquidity run rate today?
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