By Sarah Young
LONDON (Reuters) -Holiday company TUI Group said on Thursday a surge in bookings from Germany had driven a recovery from the pandemic slump and an easing of travel restrictions in Britain would add momentum.
The German-based company said bookings had jumped by 1.5 million since May, and in total it had 4.2 million bookings for this summer, compared to about 9 million in a typical summer, helping to ease pressure on finances which have been strained by the COVID-19 crisis.
"We are adding bookings every day," chief executive Fritz Joussen told reporters.
Britain's slower than expected reopening of travel dragged on TUI in its April-June quarter, but Joussen said UK bookings were rising after the government scrapped quarantine for fully-vaccinated people to most holiday destinations in mid-July.
The slower UK opening, however, forced the group to cut its summer capacity to 60% of its 2019 programme, down from the 75% planned in May.
TUI's London-listed shares rose 1% to 336 pence in mid-morning deals, paring earlier gains of 3%.
Bookings from Germany and the rest of continental Europe helped TUI turn cash flow positive in April-June, for the first time since the pandemic started, with a cash inflow of 320 million euros ($375.78 million).
"The good thing is liquidity is out of the way, we are not burning cash anymore," Joussen said, adding that profitability would be "reasonably good in summer" and bookings for 2022 were very strong.
TUI has taken on loans of over 4 billion euros and been bailed out multiple times by the German government after the pandemic forced it to stop running holidays last year.
Joussen reiterated the company would consider raising capital to help pay down debt at some point. In July, its banks agreed to extend its credit lines by two years to 2024.
For its third quarter, TUI posted an adjusted loss before interest and tax of 670 million euros on revenues of 650 million euros.
($1 = 0.8524 euros)