Preussag says UK has developed better than German market

Preussag has revealed that the UK market has developed considerably better than the German market, as the group announced 2001 was the most successful financial year in the company’s history.

Preussag said that it has achieved 9% growth over the previous year. At Euro 811 million, the results by divisions exceeded that of the 1999/2000 financial year by Euro 64 million. The Group annual profit (after tax) rose by Euro eight million to Euro 411 million.

The company said that despite the events of 11 September, the tourism division finished the year very successfully, highlighted by the approximate 25 per cent increase in profit to Euro 530 million. With a return on equity of 32 per cent, it said “tourism performance was at record level”.

Commenting on the results, executive board chairman Dr. Michael Frenzel said: “We made another big step forward in the 2001 financial year on our way to becoming a services group. 2001 was also a test year for the integrated business model of the tourism division. The results confirm that we are pursuing the correct strategy,”.

The Central Europe segment which includes the Central European tour operating business, hotel holdings and destination services, made the main contribution to profits with Euro 350 million (plus 30 per cent). The company said that the Northern Europe segment in its first full financial year within the Group generated a very good result with Euro 180 million, which included Thomson Holidays posting the best performance in its corporate history.

The company said the successful implementation of the new international brand concept has made “World of TUI” a central point of orientation for customers, employees and business partners. However, the company said it wants to more clearly highlight to the financial world the orientation and resources of our Group, and therefore intend to rename the Group ‘TUI AG’.

The company said that advance bookings for the summer season show a clear recovery on a weekly basis but are still down for the Group as a whole by 8.5 per cent, and that it has a “modest outlook” for the ongoing financial year. In Germany, bookings for the summer season are currently down by around 13 per cent. The reduction in the market in Germany is predicted to be between six and eight per cent. The company said that the tangible feeling of insecurity amongst consumers in the German market has an impact on the profit forecasts of tourism in particular, but that in the UK there had been a “clear recovery” and that the “UK market has developed considerably better than the German market”. The year-on-year drop in booked turnover in the UK is currently only slightly less than four per cent.

“The Group is therefore currently profiting considerably from its European positioning,” said Frenzel assessing the outlook for 2002. “We are in an excellent position with our ‘World of TUI’ brand which has gained high levels of awareness within a very short period of time. We are optimising our structures on the basis of our performance-preservation and cost-cutting programmes, are further expanding our market positions, and will emerge revitalised
from the current temporary slowdown in growth.”