TUI is returning the first part of the credit lines provided during the pandemic on 1 April 2022. The financial resources made available by the German government and private banks in the framework of the three stabilisation packages will then be reduced by around €700 million. A large part of this refers to the KfW Revolving Credit Facility (RCF).
Fritz Joussen, CEO TUI Group: "TUI was a very healthy company before the pandemic. The worldwide travel restrictions, especially at the beginning of the pandemic, almost completely deprived us of our business basis. That is why temporary aid was important and right. Thanks to the credit lines from the German federal government and from the private banks and the contribution of our shareholders, we have steered TUI safely through its most serious crisis. I would also like to thank our employees for their outstanding commitment over the past two years. We are on course and the trends are intact. People want to travel, we see the demand in bookings and expect a good Summer 22 at TUI. The company is leaner, more digital and more efficient after the pandemic and transformation. The pandemic aid from the state was mostly interest-bearing credit lines. In recent weeks, we already stopped using the state credit lines. As announced, we are now returning part of this state aid - this is another important step towards normality and to refocus TUI for growth."
The KfW RCF credit line, which was still drawn at around €500 million at the beginning of February, could be reduced to zero “due to the expected good operational performance” reports TUI. As of 28 March, TUI had liquidity of €4.1bn. Less the partial return on 1 April 2022, the liquidity stands at €3.4bn.
The company has returned the secured RCF provided by KfW and the private banks as part of the third stabilisation package in the amount of €170 million (originally €200 million). As well as the €91 million bond portion of the €150 million warrant bond fully subscribed by WSF. The part of the warrant-linked bond convertible into TUI shares of €59 million remains in place. Also retuned is €414 million of the unsecured RCF from KfW as part of the first two stabilisation packages.
Tui reports that demand for travel and booking momentum remain high with Summer 22 at 80% of Summer 19 bookings (previously 72% at Q1 2022 update).
Tui expects to close the Winter 21/22 programme as expected with capacity in the low to mid-range of its assumed range of 60% to 80% of pre-crisis levels. Bookings are currently at 66% of Winter 18/19 levels.
“Due to continued good demand combined with the full lifting of travel restrictions and the later booking profile, we expect Summer 22 to almost reach the normalised level of Summer 19,” said Tui.