TUI Travel Says Late-Booking Trend Requires Flexibility

TUI Travel PLC plans to add capacity as needed, as it confronts a late-booking trend the company estimates will continue into 2010.

“We anticipate market conditions will remain challenging and expect the later-booking pattern to continue in the next financial year,” stated CEO Peter Long. “We will continue to maintain a high degree of flexibility in our business model to allow us to alter capacity in line with market conditions.”

Winter bookings out of the U.K. are currently down 21 percent, and consequently TUI Travel is planning to reduce capacity for the winter season by 15 percent. Bookings out of the U.K. for summer 2010 are in line with last year, the company said, and the average selling price is 3 percent higher.

TUI Travel, Europe’s largest vacation company, reported on Wednesday that its third-quarter revenue dropped 1 percent, to $5.9 billion. The company’s underlying operating profit for the quarter increased $61 million, to $168 million.

The company contends that it is well-positioned to meet year-end expectations when its fiscal year closes on Sept. 30.