Friday , May 24 2019

TUI warns of Spain glut as Boeing Max deadline looms

Bloomberg

Tour operator TUI AG held to its forecast while warning that it’s battling overcapacity this summer in the Spanish vacation market, as a deadline looms for its grounded fleet of Boeing Co 737 Max jets.
The Hanover, Germany-based company reiterated its expectation for a 2019 drop of 17 percent in underlying earnings before interest and taxes.
But expenses related to the Max grounding will rise by one-third if it can’t get the jet airborne by July.
That would lead to an Ebita drop of 26 percent, and TUI needs to know about the Max’s status by the end of this month to make the deadline.
Through the first half of its fiscal year, TUI’s seasonal operating loss widened by three quarters to just over $336 million as over-capacities in Spain, especially on the popular Canary Islands, depressed profitability.

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