tui group investor presentation...tui ag | investor relations | seite 4 turnover and earnings 2007...
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TUI AG | Investor Relations | Seite 1
TUI GroupInvestor Presentation
Deutsche BankGerman Corporate ConferenceFrankfurt, 04 - 05 June 2008
TUI AG | Investor Relations | Seite 2
Agenda
I. Financials 2007
II. Tourism
III. Shipping
IV. Outlook 2008 & Strategy
TUI AG | Investor Relations | Seite 3
P&L highlights 2007
21.920.5
0
4
8
12
16
20
24
Turnover ReportedEBITA
175
-890-400
-200
0
200
Group profit after minorities
in € m in € m
2006 2007
in € bn
548
419
616
201
0
100
200
300
400
500
600
700
+ 173.0%
+ 47.2%
2006 2007 2006 2007 2006 2007
Goodwill impairment
-1,000
+ 6.6%
UnderlyingEBITA
TUI AG | Investor Relations | Seite 4
Turnover and earnings 2007
€ m 2007 2006 % 2007 2006 %
Tourism 15,638.5 14,085.1 + 11.0 448.9 394.7 + 13.7
TUI Travel 15,258.7 13,676.0 + 11.6 304.4 258.6 + 17.7
TUI Hotels & Resorts 379.8 346.7 + 9.5 146.1 123.2 + 18.6
Other - 62.4 - - 1.6 12.9 n.m.
Shipping 6,201.6 6,254.0 - 0.8 196.7 89.2 + 120.5
Container shipping 6,018.4 6,093.7 - 1.2 182.5 81.3 + 124.5
Cruises 183.2 160.3 + 14.3 14.2 7.9 + 79.7
Central operations 25.5 175.5 - 85.5 - 29.5 - 65.4 + 54.9
Continuing operations 21,865.6 20,514.6 + 6.6 616.1 418.5 + 47.2
Discontinuing operations - 401.0 - - 29.8 -
Group 21,865.6 20,915.6 + 4.5 616.1 448.3 + 37.4
Turnover Underlying EBITA
TUI AG | Investor Relations | Seite 5
Good start into the new financial year - Q1 2008
Significant increase in Group Turnover to €5.1 bn (Q1 07: €4.1 bn, +24.3%) especially due to consolidation of First Choice Holidays
Underlying Group EBITA improved by 21% to €-196 m (Q1 07: €-248 m)
Underlying EBITA of Tourism* (TUI Travel, TUI Hotels & Resorts, Cruises) almost unchanged at €-221 m (Q1 07: €-227 m) despite the first time consolidation of First Choice with €-83 m. The former TUI Tourism business strongly improved to
€-138 m.
Underlying EBITA of container shipping** with substantial performance improvement at €18 m (Q1 07: €-36 m)
* Cruises in tourism business with effect from Q1 2008 ** Container shipping classified as discontinued operation with effect from Q1 2008
TUI AG | Investor Relations | Seite 6
Tourism
TUI AG | Investor Relations | Seite 7
TourismTUI Travel - Overview
Merger of TUI Tourism activities with First Choice Holidays businesses
Europe’s leading international leisure travel company
Over 30 million customers from over 20 source markets
Circa 160 aircraft
Circa 4,000 retail shops in Continental Europe, UK & Ireland
48,000 colleagues
Widest range of leisure travel experiences available
TUI AG | Investor Relations | Seite 8
TourismTUI Travel - New structure
MainstreamSector
Classic TO business /market leadership
Online Destination
Services Sector
Online accommodation / Destination services
SpecialistsSector
Exclusive products / strong local brands
ActivitySector
Lifestyle travel products / market-leading brands
Pro forma FY 2007*: Turnover: ~€18.9 bn
Ebita (underlying): ~€500 m
Turnover:~€16,100 m
Ebita: ~60%
Turnover:~€1.500 m
Ebita: ~10%
Turnover:~€650 m
Ebita: ~10%
Turnover:~€700 m
Ebita: ~15%
* unaudited
TUI AG | Investor Relations | Seite 9
TourismTUI Travel - Business model
Choice of Product Flexibility for the Customer
CONTENT
CUSTOMER
Self SelectionIndividual Components
Self SelectionDynamic Packaging
Traditional Packages
Exclusive / Differentiated Holidays
Tailor Made Holidays
Online
Retail
Call Centre
Providing choice and flexibility for the customer
Flights
Bed-bank
Car hire, transfers, excursions
Differentiated
Exclusive
Added Value
Expertise
Scarce Assets
Component
Specialist
TUI AG | Investor Relations | Seite 10
Tourism TUI Travel - Value Creation Opportunities
Intensive Care
RecoveryStage
CriticalStage
Healthy Stage
ThrivingStage
Loss making < 1%Operating
Margin1% – 3% 3% – 5% > 5%
RevenueContribution1,2
UnderlyingOperating Profit1,2
-€66m(-£48m)
€1.8bn(£1.3bn)
€4.3bn(£3.1bn)
€5.6bn(£4.1bn)
€3.6bn(£2.6bn) €2.3bn
(£1.7bn)
€32m(£23m)
€85m(£62m)
€130m(£95m)
€212m(£155m)
€11bn1 (£8bn) of Under-Performing Revenue
1 based on year end 2007 GBP / € exchange rate of: 0.73 2 Proforma 12 months to 30 September 2007
TUI AG | Investor Relations | Seite 11
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
TUI AG | Investor Relations | Seite 12
TourismTUI Travel – Merger related synergies
32%
9%
9%
33%
17%
Airline Restructuring & IT Distribution Tour Operations Group & Global
Synergy mix
Synergies upgraded by 50%: Full synergy benefit of approximately €200 m* (₤150 m) expected until 2010Cost of expected synergies at around €250 m* (₤180 m)
* based on year end 2007 GBP / € exchange rate of: 0.73
TUI AG | Investor Relations | Seite 13
TourismTUI Hotels & Resorts - At a glance
No 1 leisure hotelier in Europe with
237 hotels and 145,000 beds
Most hotel companies with local
partners
Focus on four star category (approx.
60%)
High occupancy rates (~80%) through
access to TUI Travel customers and
direct distribution
TUI AG | Investor Relations | Seite 14
TourismTUI Hotels & Resorts - Overview
Group-controlled hotel beds by regions
Eastern Mediterranean
19%
Western Mediterranean
36%
North Africa / Egypt18%
Caribbean18%
Other9%
3 Stars16%
5 Stars21%
4 Stars63%
Hotel categories
Selective organic growth through
new hotel projects with 16
scheduled openings in 2008
TUI AG | Investor Relations | Seite 15
TourismTUI Cruises
Hapag-Lloyd Cruises operates 4 ships in the German premium and luxury segment
Utilisation of all ships was 78.6% in 2007, up by +5.1p.p. y-o-y
Joint Venture (50/50) with Royal Caribbean Cruises Ltd.
Permission received from European antitrust regulators in March 2008
Plan on track to start business in Summer 2009
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Shipping
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Global volume development container shipping(in TEU mill )
ShippingContinuously strong market volume growth
Source: Global Insight, March 2008
CAGR 10% CAGR 7%
74
86
96
105
114121
130
140
149
158
167
2003 2004 2005 2006 2007 2008e 2009e 2010e 2011e 2012e 2013e
TUI AG | Investor Relations | Seite 18
ShippingVolume development of main trade lanes
World Container Trade 2008e (TEU m)
13.6 (+8.0%)
Latin America
North America Europe
Africa
Far East
Middle East /Indian Ocean
Australia/New Zealand
3.7 (+5.1%)
5.6 (+6.8%)2.9 (+4.2%*)
6.6 (+6.4%)
1.3 (+5.1%)
2.9 (+5.6%)
Intra Far East
Source: Global Insight, March 08
16.2 (+7.7%)
25.4 (+7.5%)
*Compound Annual Growth Rate
(CAGR) 2008-2011 forecast in%
is shown in brackets
Dominant legNon-dominant leg
TUI AG | Investor Relations | Seite 19
ShippingHapag-Lloyd at a glance
Top 5 global container shipping company
through acquisition of CP Ships
141 container vessels with a total capacity
of 493,000 TEU
Revenues in 2007: € 6.0 bn
Volume in 2007: 5.5 mill TEU
Share of volume for 2007 (mill TEU):
Far East26%
Australasia13%
Latin America
16%
Atlantic27%
Trans-Pacific19%
TUI AG | Investor Relations | Seite 20
Shipping transport chain Highly efficient integrated IT systems
Empty Container (Return)
Factory/ Distribution
Centre
Inland Transport to Consignee
InboundPort
Ocean LegInland Transport
to PortOutbound PortFactory
Empty Container (Delivery)
Source: Company information
Fully integrated throughout the global organisation of more than 260 locations
Covers the entire transport chain (“only one transport file per shipment”)
Infrastructure supports all services throughout the value chain to offer customers efficient and reliable solutions
Developed in-house over past years with significant investment
an industry-leading IT system...
Only one Transport File per Shipment
Provides network to facilitate decentralised, global blueprint organisation
Real-time availability of information worldwide
Provides and combines operational and financial data
Contribution-driven, cost-effective business steering model
Improves accuracy and control of transport and documentation
...with significant efficiency benefits
Hapag-Lloyd operates
TUI AG | Investor Relations | Seite 21
ShippingProductivity development
693
754
856
873
751
916
471
0
100
200
300
400
500
600
700
800
900
1.000
2002 2003 2004 2005 2006 2007
HL Land personnel CP Ships
(82%)
(95%)(100%)
- TEU/employees -
Figures as of year end
TUI AG | Investor Relations | Seite 22
ShippingCost reduction measures
Reduction of bunker consumption:
Speed reduction of vessels in selected services
Silicone-based underwater paint
Optimization of service schedules
Cargo selection according to weight
Hedging strategies for bunker and currency exposure
Optimization of imbalance steering
Continue productivity enhancements
Continue process optimization
TUI AG | Investor Relations | Seite 23
Agenda
I. Financials 2007
II. Tourism
III. Shipping
IV. Outlook 2008 & Strategy
TUI AG | Investor Relations | Seite 24
TourismBooking update
y-o-y variation% SalesSummer 2008
Customers Capacity SalesWinter 2008/09
Customers Capacity Short-haul +1 -13 -23 -5 -9 -25
Medium-haul +21 +9 -4 +15 +9 -13
Long-haul +8 +8 +2 +6 +2 -4
UK +8 -2 -13 +15 +6 -16
TUI Nordic +3 +1 flat +1 -4 +2
Northern Europe +7 -2 -11 +9 +2 -12
TUI Germany +4 +1
TUI Austria -22 -20
TUI Switzerland +12 +11
Central Europe +3 flat -14
TUI France -6 -10
TUI Belgium +7 +3
TUI Netherlands +6 +2
Western Europe +1 -2 flat
Specialist +9 +2
Activity +4 n/a
ODS +32 +24
Not on sa
le
Based on trading statistics up to 4 May 2008
TUI AG | Investor Relations | Seite 25
Outlook Tourism 2008
European travel market expected to grow 3-4%*
Turnover forecast to reach up to €19 bn
For the Tourism division underlying EBITA is expected to rise significantly
Drivers for underlying EBITA improvement of TUI Travel: - Full year consolidation of First Choice businesses- Synergy benefits in first full year - Capacity management and growth of controlled distribution & differentiated
content in the Mainstream sector - Combination of organic & acquisition led growth in specialist sectors
Drivers for Underlying EBITA improvement of TUI Hotels & Resorts:- Increase in number of bednights- Slight rise in the average revenues per bed
* WTTC Report 2007
TUI AG | Investor Relations | Seite 26
Container Shipping Freight rate trends by trade lanes
1,511
1,508
1,494
1,422
1,381
1,645
1,266
1,459
1,562
1,234
1,506
1,415
1,345
1,392 1,443
1,626
1,653
1,556
1,4661,451
1,2031,179 1,2211,1741,179
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08
Freight rate in US$/TEU Atlantic
Trans-PacificLatin America
Far East
Australasia
TUI AG | Investor Relations | Seite 27
Outlook Container Shipping 2008
Market growth of approx. 7%* expected
Hapag-Lloyd transport volumes in-line with market growth
Average freight rates are forecast to rise against last year
Depending on the development of the US Dollar versus the Euro an increase in
turnover to up to €7 bn should be possible
Underlying EBITA expected to increase significantly based on:
- Growth in average freight rates and rise in volumes
- Full synergies from the integration of CP Ships being available
- Further cost savings in operative business
* Global Insight December 2007
TUI AG | Investor Relations | Seite 28
Strategy - Separation of container shipping
All options are being examined like: spin off, merger or divestment as a single entity
taking into account the interests of our shareholders, bondholders and employees
Separation process progressing according to plan
- Internal project team has been installed
- External advisors have been mandated
- Information memorandum in preparation
- Approach of interested parties can be expected for late May / early June
Targeted impact on TUI Group financials
- Significant reduction of net debt
- Enhanced financial flexibility for further investments in the tourism division
- Appropriate consideration of shareholders
TUI AG | Investor Relations | Seite 29
TUI - current group structure
Tourism Shipping
TUI AG | Investor Relations | Seite 30
Financial calendar
15 May 2008 First Quarter 2008
14 August 2008 Second Quarter 2008
TUI Travel PLC: Third Quarter 2008
14 November 2008 Third Quarter 2008
TUI Travel PLC: Prelim. Financial Year 2008
25 March 2009 TUI Financial Year 2008
13 May 2009 TUI Annual General Meeting
TUI AG Investor Relations - E-Mail: [email protected] - Phone: +49-511-566-1425
TUI AG | Investor Relations | Seite 31
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.