Lates boost TUI Travel as it unveils warchest

The operator has also sold most of its summer 2009 holidays, thanks to a late booking surge, but winter bookings are down.

Details of the refinancing and bookings were reported in a trading update today, which also revealed TUI Travel has cancelled ten of the 23 Boeing 787 Dreamliner aircraft that it had on order.

It has added purchase rights, with no obligation, for a further 13 of the Dreamliners, because ‘this optimises the flexibility around our long-haul capacity’. It expects to receive delivery of the first B787 in early 2012.

TUI Travel chief executive, Peter Long, said: ‘Trading continues in line with our expectations and we remain satisfied with our trading performance across all open seasons.

‘As we near the end of the current season, we are pleased that the summer 2009 lates market has traded well showing that holiday demand and supply have been in balance, despite the later booking trends experienced.’

However, winter booking volumes in the UK are down about 21% because of lower capacity, which has been ‘adjusted to align supply and demand’.

Early bookings in the UK for summer 2010 are in line with the previous year, with average selling prices up 4%.

As part of its acquisition strategy, TUI Travel has announced a proposed strategic venture with Sunwing, a leading tour operator in Canada, to boost its position in the ‘challenging and fragmented’ Canadian market.

Other acquisitions will be niche specialists; transactions that improve underperforming mainstream businesses; and firms in emerging markets such as Russia and the CIS.

In the current financial year, the company has spent £120m on 14 acquisitions and joint ventures and will spend a further £55m creating the strategic venture in Canada with Sunwing.