TUI Group on Thursday posted an annual loss of 3 billion euros ($3.6 billion) as the pandemic choked travel demand and finances of the world's biggest holiday group, forcing it to seek multiple bailouts from the German government.
The Hannover, Germany-based company said it will raise its cost-cutting targets to 400 million euros annually from the previous level of 300 million euros, trying to become more efficient to help pay off new debts taken on to survive the crisis.
Last week, TUI secured a third bailout, striking a deal with the German government, private investors and banks for an extra 1.8 billion euros, on top of state loans of 3 billion euros it had already received.
"The rapid measures to cut costs and secure liquidity are important for the Group. They are a stable foundation for the future," TUI Chief Executive Fritz Joussen said in a statement.
The company posted a loss of 3 billion euros, from 894 million euros of underlying core earnings (EBIT) last year, while revenue came in 58% lower at 7.9 billion euros.
Following the latest bailout, TUI now has 2.5 billion euros of liquidity, and Joussen said the COVID-19 vaccine would help boost demand for holidays in 2021, forecasting a return to 2019 levels by 2022.
Bookings for next summer were 3% higher than they were at this stage in
2019, and average prices for summer 2021 were 14% higher than 2020, TUI said.