tui group investor presentation · hapag-lloyd tui ag tui with controlled container shipping exit...

TUI AG | Investor Relations |

Merrill LynchAll Stars 2009 Conference New York, 31 March - 01 April 2009

TUI GroupInvestor Presentation


I. Strategy

II. Tourism – Travel/Hotels&Resorts/Cruises

III. Container shipping – discontinued operations

IV. Financials

V. Outlook

Agenda


Tourism

TUI – current group structure

Tour Operator At equity (43.3%)Hotels Cruises


Hapag-Lloyd disposal: transaction highlights

Gain on disposal

Net debt

Approx. €1.0 bnRealization at closing

Significant reduction by approx. €2.8 bn

Additional liquidity frame of €1.1 bn

Entity Value

TUI sells 100% of Hapag-Lloyd to BidCo

TUI acquires 43.3% of BidCo; Albert Ballin KG holds 56.7% Deal Structure

€4.450 bn (=100%)

Deal components Container line, terminal participations and real estate

Timing Closing completed in March 2009


Deal structure

Albert BallinKG

Hapag-Lloyd

TUI AG

TUI with controlled Container shipping exit

TUI keeps a significant interest in Hapag-Lloyd

Earn-Out of €250 m on fulfillment of 3 year budget (cumulated)

TUI can sell 33.3% participation early 2010, but 10% immediately

pre-emption right of Albert Ballin KG

TUI holds a put option to sell all shares to Albert Ballin KG exercisable from 1 January 2012, but the execution of 10% can be extended until 2014

43 1/3% 56 2/3%

BidCo

100%


Tourism


TourismTUI Travel – overview

Merger of TUI Tourism activities with First Choice Holidays businesses in 2007

Europe’s leading international leisure travel company

Over 30 million customers from over 25 source markets

Over 150 aircraft

Circa 3,500 retail shops in Continental Europe, UK & Ireland

50,000 colleagues

Widest range of leisure travel experiences available


TourismTUI Travel – business segments

MainstreamSector

Classic TO business /market leadership

Online Destination

Services Sector

Destination services / Online accommodation

SpecialistsSector

Exclusive products / strong local brands

ActivitySector

Lifestyle travel products / market-leading brands

Turnover~€15,5 bn

Turnover~€1.0 bn

Turnover~€1.0 bn

Turnover~€0.5 bn


TourismTUI Travel – pillars of profitable growth

Product & Content Differentiated and specialist product

Levers

Business Model & People

Synergy deliveryEfficiency improvementsCapacity managementLeadership & structure

Distribution & BrandsDirect distributionBrand positioning

Growth & Capital Allocation

Acquisition programmeOrganic growthROI focusCash management

Delivering sustainable

margin growth

Strategic Imperatives


Tourism TUI Travel – integration and synergy update

TUI Travel achieved following milestones in 2008:

Integrating and relocating all tour operating and airline functions into Luton

Integrating the charter airlines in the UK under one common airline operating certificate

Integrating controlled distribution and introducing one reservation system for the Mainstream and Specialist tour operators in the UK

Integrating the former TUI and First Choice activities outside the UK, e.g. in France or in the Online Destination Services sector

Integration programme is well on track, additional amount of £25 m of synergies identified, particularly in the UK mainstream business➔ Full synergy benefit of £200 m expected


TourismTUI Hotels&Resorts


TourismTUI Hotels&Resorts – at a glance

No 1 leisure hotelier in Europe with

238 hotels and approx. 150,000 beds

Most hotel companies with local

partners

Focus on four star category (65%)

High occupancy rates (~80%) through

access to TUI Travel customers and

direct distribution


TourismTUI Hotels&Resorts – overview

Group-controlled hotel beds by regions

Eastern Mediterranean

19%

West. Mediterranean

33%

North Africa/ Egypt21%

Caribbean20%

Other7%

Hotels by categories

5 Stars23%

3 Stars12%

4 Stars65%

Total:238

Total:149,424


TourismTUI Cruises


TourismTUI Cruises

Joint Venture (50/50) with Royal Caribbean Cruises Ltd.

First broschure published in early September 2008

First cruise in May 2009

Hapag-Lloyd Cruises operates 4 ships in the German premium and luxury segment

High average fleet utilisation with 80.2% in 2008


Container shipping – discontinued operations


944

634492 459 448 435 425 376 354 348 299 298 292 287 251 241 184 138

1,932

1,425

MAERSKMSC

CMA-CGM

EVERGREEN

HAPAG-LLOYD

COSCO

NOLNYKCSCL

MOLOOCLHANJINK-LI

NE

HAMBURG-SUD

YANG MIN

GCSAV

ZIMHYUNDAI

PILUASC

Capacities in tsd TEUships >399 Teu

Hapag-Lloyd ranked Number 5

Container shippingGlobal Top 20 Container Carriers

Source: Transmodal, Jan 09


Far East24%

Australasia13%

Latin America

18%

Atlantic25%

Trans-Pacific20%

Container shipping Hapag-Lloyd at a glance

Top 5 global container shipping company

128 container vessels with a total capacity

of 492,000 TEU*

Revenues in 2008: €6.2 bn

(+ 4.3% y-o-y)

Volume in 2008: 5.5 mill TEU

(+ 1.7% y-o-y)

Share of volume for FY 2008 (mill TEU):

*Fleet Status: 31 December 2008


I. Strategy



IV. Financials

V. Outlook

Agenda


46

439

548

404

0

100

200

300

400

500

600

- 88.6%

18.7

15.9

0

4

8

12

16

20

P&L highlights 2008

Turnover ReportedEBITA

-121

173

-200

-100

0

100

200

2007 2008Group profit after

minorities

in € bn in € m in € m

UnderlyingEBITA

+ 17.5% + 24.8%

2007 2008 2007 2008 2007 2008

Goodwill impairment

Reported EBITA 2008 impacted by integration related cost at TUI Travel


€ m 2008 2007 %

Tourism Turnover 18,628.4 15,814.5 + 17.8 Underlying EBITA 601.9 463.2 + 29.9Central operations Turnover 85.9 117.6 - 27.0 Underlying EBITA - 54.4 - 24.5 -122.0Continuing operations Turnover 18,714.3 15,932.1 + 17.5 Underlying EBITA 547.5 438.7 + 24.8Container shipping* Turnover 6,219.8 5,964.5 + 4.3 Underlying EBITA 211.1 177.4 + 19.0Consolidation Turnover -25.9 -38.2

Group Turnover 24,908.2 21,858.4 + 14.0 Underlying EBITA 758.6 616.1 + 23.1

Turnover and Earnings 2008

*Discontinued operations


Balance sheet 2008Net financial debt position

€ bn 2008 2007 %

Financial liabilities 4.98 5.53 - 9.9

thereof non-current 3.97 4.73

thereof current 1.01 0.80

Cash 2.05 1.61 + 27.3

Net debt 2.93 3.92 - 25.3Net debt container shipping 1.15 -

Net debt incl. container shipping 4.08 3.92 + 4.1

Reclassification of liabilities of €1.15 bn under IFRS 5 (Hapag-Lloyd)


Impact from Hapag-Lloyd disposalMedium-term capital employed in shipping

-in €m- Amount Maturity

TUI Vendor Loan 180 03/2014

TUI RCF 200 03/2010

New short-term loan 380 03/2010-11

New long-term loan 400 12/2011

New subordinated loan 300 12/2012

∑ Credit lines 1.460

43 1/3 % participation (Put option)

910

∑ ∑ Financial engagement 2.370

to be sold: Real estate 150

Remaining inter-company receivable of TUI AG – no fresh money

Repayment guaranteed by the consortium

Chances

Refinancing opportunities of Hapag-Lloyd to replace drawings

FactoringSecured financingAsset disposals

approx. US$ 600 - 700 m

€190 m to be repaid 03/2010

€1.1 bn liquidity frameActual drawings €0.7 bn


TUI Group

Net debt current structure (31.12.2008) €4.1 bn

Net impact upon closing of HL-deal (56.7%) €2.8 bn

Pro forma net debt after closing of shipping €1.3 bn

Drawings from liquidity frame €0.7 bn

Pro forma net debt including drawings €2.0 bn

Impact from Hapag-Lloyd disposalPro forma impact of disposal proceeds on net debt

€1.6 bn cash€1.2 bn net debt


I. Strategy



IV. Financials

V. Outlook

Agenda


Tourism – TUI TravelTrading update

Summer 2009

y-o-y variation% ASP Sales Customers Capacity Left to sell ASP Sales Customers Capacity Left to sell Short-haul + 5 - 12 - 16 + 8 - 17 - 23 Medium-haul + 10 + 1 - 8 + 11 - 7 - 16

Long-haul + 6 + 2 - 4 + 12 - 16 - 25

UK Charter + 10 - 2 - 11 - 9 + 4 + 10 - 10 - 18 - 17 - 14Nordic + 2 - 6 - 8 - 8 - 11 + 8 - 14 - 20 - 14 - 10

Northern Region + 7 - 3 - 9 - 8 + 3 + 10 - 11 - 19 - 16 - 15

Germany - charter flat - 4 - 4 + 1 - 12 - 13 Germany - Scheduled + 16 - 15 - 27 + 14 + 22 + 7Total Germany + 7 - 5 - 11 - 16 - 29 - 2 - 11 - 9 - 15 - 17Austria + 8 - 20 - 26 - 27 + 4 - 15 - 18Switzerland - 5 - 14 - 9 - 29 - 8 - 26 - 20Poland + 7 + 17 + 10 + 17 flat - 52 - 52

Central Europe + 6 - 6 - 11 - 17 - 30 -2 - 13 - 11 -15 - 17

France + 7 - 7 - 13 - 10 + 4 - 20 - 23Belgium + 4 + 2 - 2 - 6 flat - 7 - 7Netherlands + 2 - 7 - 9 - 15 + 1 - 19 - 20

Western Europe + 4 - 5 - 9 - 10 - 18 + 1 - 15 - 15 - 10 - 5

Specialist + 11 - 1 - 11 + 2 - 15 - 17

Activity n/a - 7 n/a n/a - 20 n/a

ODS + 1 + 2 + 1 + 3 - 9 - 11

Winter 2008/09

Based on trading statistics up to 15 March 2009


Measure US$ m Details

Ship system 193 Service network optimization, re-routing, bunker management

Terminal, inland, operations 118 Renegotiation terminal and inland contracts

General and administration 45 Consulting, IT, Travel etc.

Hiring freeze, temps 9 No extension of temporary staff contracts, hiring freeze

Total 365

Cost saving measures Hapag-Lloyd in 2009


Outlook 2009Expectations for underlying earnings (EBITA)

2008 2009

€453 m

€142 m

€7 m

€211 m

Synergy benefits from integrationTight capacity managementStable product margins; high capacity utilization

Slightly higher capacityStable earnings expected

Positive development of Hapag-Lloyd KreuzfahrtenEarnings expected to fall due tostart-up costs of TUI Cruises

Full consolidation until 03/09 (no cash impact!)At equity from 04/09 (43.3%) Cost saving program initiated (~ US$ 360 m)


25 March 2009 Financial Year 2008

11 May 2009* First Quarter 2009

13 May 2009 Annual General Meeting 2009

13 August 2009* Second Quarter 2009

12 November 2009* Third Quarter 2009

Financial calendar 2009

TUI AG Investor Relations - E-Mail: [email protected] - Phone: +49-511-566-1425

* scheduled


Future-related statements

This presentation contains a number of statements related to the future

development of TUI. These statements are based both on assumptions and

estimates. Although we are convinced that these future-related statements

are realistic, we cannot guarantee them, for our assumptions involve risks

and uncertainties which may give rise to situations in which the actual

results differ substantially from the expected ones. The potential reasons

for such differences include market fluctuations, the development of world

market fluctuations, the development of world market commodity prices,

the development of exchange rates or fundamental changes in the economic

environment. TUI does not intend or assume any obligation to update any

forward-looking statement to reflect events or circumstances after the date

of these materials.

tui group investor presentation · hapag-lloyd tui ag tui with controlled container shipping exit...

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