TUI AG, the German owner of Europe's largest travel company, reported a full-year loss on costs to integrate its purchase of First Choice Holidays plc and raised its forecast for savings from the deal.
The net loss was 121.3 million euros (S$248.9 million), or 57 cents a share, after a profit of 172.7 million euros, or 60 cents, a year earlier, the Hanover, Germany-based company said yesterday. That was a wider shortfall than the median loss estimate of 50.7 million euros by four analysts compiled by Bloomberg.
TUI said that savings from the First Choice merger will be £200 million (S$441.8 million) a year, more than the previous target of £175 million. The company also forecast a 'slight' increase in underlying earnings for TUI Travel this year, while its entire tourism business, which includes hotels and cruise ships, will be 'stable' in 2009.
'Additional synergies should have been reached mainly in the UK, for example through better airline route network planning,' Martina Noss, an analyst at Nord LB in Hanover, wrote in a note to investors before the figures were published.
TUI, which completed the sale of its Hapag-Lloyd shipping line this week, spent 440 million euros last year to combine TUI Travel's business with First Choice, which was acquired in 2007.
TUI Travel, based in Crawley, England, said in a separate statement that business is on a pace to meet its annual targets after 'strong' performances in the UK, Germany and Belgium so far this year. The company reported its loss for the three months through December narrowed to £66.6 million from a loss of £103 million a year earlier.
TUI rose seven cents, or 1.8 per cent, to 3.97 euros at 10.39 am in Frankfurt trading. The stock has dropped 51 per cent this year. TUI Travel rose 0.75 pence, or 0.3 per cent, to 237.25 pence in London.
Sales from continued operations rose 17.5 per cent to 18.7 billion euros. Including Hapag, sales rose 14 per cent to 24.9 billion euros. Net debt rose to 4.1 billion euros as at Dec 31 from 3.9 billion euros a year earlier.
Net income includes Hapag, the world's fifth largest container line. Its sale was sealed after TUI extended the Hamburg-based buyer group more credit. Hapag will draw 700 million euros in the near future from a credit line totalling as much as 1.1 billion euros, chief executive officer Michael Frenzel said at a press conference in Hanover.
Hapag's earnings before interest and tax rose 19 per cent to 211.1 million euros. TUI said that a cost-cutting programme at Hapag will result in savings of US$365 million. A 'substantial' earnings decline is still expected for the container line this year because of the economic crisis, the company said.
The net loss was 121.3 million euros (S$248.9 million), or 57 cents a share, after a profit of 172.7 million euros, or 60 cents, a year earlier, the Hanover, Germany-based company said yesterday. That was a wider shortfall than the median loss estimate of 50.7 million euros by four analysts compiled by Bloomberg.
TUI said that savings from the First Choice merger will be £200 million (S$441.8 million) a year, more than the previous target of £175 million. The company also forecast a 'slight' increase in underlying earnings for TUI Travel this year, while its entire tourism business, which includes hotels and cruise ships, will be 'stable' in 2009.
'Additional synergies should have been reached mainly in the UK, for example through better airline route network planning,' Martina Noss, an analyst at Nord LB in Hanover, wrote in a note to investors before the figures were published.
TUI, which completed the sale of its Hapag-Lloyd shipping line this week, spent 440 million euros last year to combine TUI Travel's business with First Choice, which was acquired in 2007.
TUI Travel, based in Crawley, England, said in a separate statement that business is on a pace to meet its annual targets after 'strong' performances in the UK, Germany and Belgium so far this year. The company reported its loss for the three months through December narrowed to £66.6 million from a loss of £103 million a year earlier.
TUI rose seven cents, or 1.8 per cent, to 3.97 euros at 10.39 am in Frankfurt trading. The stock has dropped 51 per cent this year. TUI Travel rose 0.75 pence, or 0.3 per cent, to 237.25 pence in London.
Sales from continued operations rose 17.5 per cent to 18.7 billion euros. Including Hapag, sales rose 14 per cent to 24.9 billion euros. Net debt rose to 4.1 billion euros as at Dec 31 from 3.9 billion euros a year earlier.
Net income includes Hapag, the world's fifth largest container line. Its sale was sealed after TUI extended the Hamburg-based buyer group more credit. Hapag will draw 700 million euros in the near future from a credit line totalling as much as 1.1 billion euros, chief executive officer Michael Frenzel said at a press conference in Hanover.
Hapag's earnings before interest and tax rose 19 per cent to 211.1 million euros. TUI said that a cost-cutting programme at Hapag will result in savings of US$365 million. A 'substantial' earnings decline is still expected for the container line this year because of the economic crisis, the company said.