Over 40 years’ heritage
185,800 clients worldwide
Over 15,000 markets

TUI Travel reports soaring full-year profits

TUI has beat market expectations with a 13% rise in its full-year profits, boosted by premium holiday sales.

Underlying operating profits for the year have increased to £550 million, and these better-than-expected figures have given the company the confidence to maintain its growth target for 2014 at 7-10%, despite the cloudy economic picture. TUI Travel is the world’s biggest tour operator, and through its Thomson and First Choice brands the UK-quoted company has seen a surge in sales in its higher-margin UK and German markets.

The company now stands with a £4.23 billion market capitalisation, and prior to today’s announcement already offered investors a 3.26% dividend yield. The 17% increase in the final dividend has raised this to a gross yield of 3.89%. The fact that the firm’s major competitor, Thomas Cook, has had such a poor couple of years has ultimately been helpful to TUI. Thomas Cook’s woes were triggered by market fears over funding, and this initially hurt all operators in the sector as concerns over holiday deposits spread. However, subsequently the improved reputation afforded to TUI Travel has boosted sales.

Earlier in the year shares failed to break 400p, dropping 60p before remounting an assault on this level. A break above here may see renewed buying as traders look for a return to the two-year bullish trend the firm has experienced.

With over 6000 global shares to choose from and margin rates from 5%, start shares trading with IG.

TUI Travel plc chart

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.