Tui Group chief executive Fritz Joussen said turnover from this sector in the first quarter of the year (October to December 2019) had risen 35%, with sales up 17%.
“We will invest this year for growth, because consolidation in the activities field is happening as we speak,” he added.
He said Tui had spent €5 million on marketing Destination Experiences in Q1. “It’s a volume-first approach in order to be in the forefront of consolidation,” he said.
The operator also said it would increase third-party distribution of activities and excursions.
Another growth segment will be hotels and resorts, with 17 hotels planned to open this year, a number of which will be under the Riu and Robinson brands. Tui plans to have “almost 100” Tui Blue properties, a strategy it can accelerate in Turkey, having taken many former Thomas Cook hotels.
Tui’s hotels and resorts division saw average revenue per bed increase from €65 to €68 in the first quarter despite a 4.3% capacity increase. Joussen said: “This is very healthy in winter because more volume means slightly higher costs.”
Tui said its cruise brands were likely to see “limited yield growth” in 2020 due to a big increase in capacity last year. Joussen said Marella had seen increased average daily rates tempered by increased fuel costs and regulatory burdens.
Tui’s Northern region, which includes the UK, saw Q1 losses increase from €62.8 million to €105.8 million as a result of expansion following the Thomas Cook collapse and the continued grounding of the Boeing 737 Max.
