COVID-19 UPDATE & FY20 9M RESULTS 13 AUGUST 2020
FORWARD-LOOKING STATEMENTS This presentation contains a number of statements related to the future development of TUI. These statements are based both on assumptions and estimates. Although we are convinced that these future-related statements are realistic, we cannot guarantee them, for our assumptions involve risks and uncertainties which may give rise to situations in which the actual results differ substantially from the expected ones. The potential reasons for such differences include market fluctuations, the development of world market fluctuations, the development of world market commodity prices, the development of exchange rates or fundamental changes in the economic environment. TUI does not intend or assume any obligation to update any forward-looking statement to reflect events or circumstances after the date of these materials. 2 TUI GROUP | FY20 9M Results | 13 August 2020
Agenda I. C-19 Update 1. Operational achievements during restart & current priorities 2. Financial achievements during restart & current priorities 3. Global Realignment Programme underway II. FY20 9M Results III. Summary 3 TUI GROUP | FY20 9M Results | 13 August 2020
C-19 UPDATE FRITZ JOUSSEN / BIRGIT CONIX TUI GROUP | FY20 9M Results | 13 August 2020
Opening statement ✓ Successful restart of operations in all source markets ✓ Partial restart of business has generated immediate working capital inflow ✓ Q3 results demonstrate the significant reduction of cash fixed costs ✓ Expect to be broadly cash break-even in Q4 2020 on an operational level ✓ Stabilisation package with German government agreed in the amount of €1.2bn ✓ Summer 21 bookings very promising up by around 145% compared to previous year ✓ Global realignment programme underway – targeting over €300m p.a. cost reduction by FY23 TUI entered into agreements to cover seasonal swing through Winter 2020/21 and thereafter 5 TUI GROUP | FY20 9M Results | 13 August 2020
Operational achievements during restart & current priorities TUI GROUP | FY20 9M Results | 13 August 2020
TUI has been the first holiday company to restart operations quickly & responsibly 1 Pilot project Majorca RIU has reopened 59 hotels Blue cruises with Mein Schiff √ √ √ worldwide fleet – from 24 July • Successful pilot project together with Balearic authorities and suppliers • Returning to operation in 14 of • 3 to 4 day cruises premium all inclusive sea • Key facts: 19 countries days offer • 15 June 2020 • All hotels will follow the health and safety • 2 TUI fly flights from Germany to • Occupancy on board limited to 60% protocols Majorca • 10-point-programme to ensure extensive • 378 guests • Specific training programme for all staff health and safety measures • Guests stayed in RIU hotels • In June, total of 4,200 German customers flew to Majorca, Ibiza and Formentera TUI’s integrated model, experience and trusted brand enabled structured immediate restart 7 TUI GROUP | FY20 9M Results | 13 August 2020
TUI’s integrated model allows quick restart and the steering of customers into own assets 1 Test CRO PMI 1 DESTINATIONS Planned from Oct ES & CI 3 PT GR EGY TR MAR TUN BU onwards FAO 2 CYP Planned from Oct SOURCE MARKETS onwards JUNE JULY AUGUST SEPTEMBER OCTOBER 61 4,200 181 4,500 220 2,300 159 55 OPERATIONS 4 885k 795k 4 11 405k 3 12k CAPACITY PLANNING IN Q4 2020 TC & HLC ~30% ~50% ~30% 5 1 Palma de Majorca 2 Faro (Portugal) 3 Spain & Canary Islands 4 Current plans relating to risk capacity 5 In line with Markets & Airlines capacity 8 TUI GROUP | FY20 9M Results | 13 August 2020
Successful operations in July – the first month of restart 1 GROUP BOOKINGS JULY 2020 OPERATIONS IN JULY 2020 Cumulative PAX 563K NORTHERN REGION 28k PAX (risk & non-risk) Booked Load Factor 89% CENTRAL REGION 311k PAX RESTART IN ACTION WESTERN REGION 224k PAX HOTELS & RESORTS 159 Hotels opened CRUISES 3 Cruise ships in operation Integrated model allows flexible capacity management along the whole value chain 9 TUI GROUP | FY20 9M Results | 13 August 2020
Health and safety protocols allow relaxing travels in times of pandemic 1 RECAP OF PROTOCOLS AS SHARED AT H1 HIGHLIGHTS • Health and safety measures successfully implemented • New hygiene standards are as strict as necessary and as relaxing as possible • Positive customer feedback shows that holiday enjoyment is not adversely affected by these measures On average our customers rate the measures 8.5 out of 10 1 1 Score range of 0 to 10, with 0 being very dissatisfied and 10 being very satisfied. 8.5 rating score reflects average of 5,746 customer responses, who travelled during the restart period between mid- June and beginning of August, when asked “How satisfied are you with the implementation of hygiene measures so far? 10 TUI GROUP | FY20 9M Results | 13 August 2020
1.7m new bookings since global travel bans were lifted – Summer 21 looks promising 1 RECENT BOOKING DEVELOPMENT 1 OVERALL BOOKING DEVELOPMENT 2 S20 W20 S21 • 57% of adjusted Summer 20 programme sold New bookings since 1,050k 195k 430k • 16% of our original Summer 20 programme sold; Overall June 1 (previous year) (2,900k) (545k) (380k) bookings down 81% & ASP down 10% compared to prior year Total net bookings 2 ~2,400k ~660k ~1,500k (previous year) (~12,700k) (~1,100k) (~630k) • Winter 20/21 still early in the booking cycle: • Bookings broadly in line with reduced capacity, to be similar on Current view of 30% 60% 80% original capacity an absolute volume level to reduced Summer 20 programme • UK bookings down 5% 2 and ASP up 2% 2 YoY • Summer 21 incl. amendments and voucher rebookings remains promising with bookings up by ~145% in part reflecting early • Short notice travel restrictions, e.g. in UK, may mean situation launch of the programme remains volatile - > TUI’s flexible business model allows quick • Occupancy levels of TUI Cruises for Summer 21 broadly in line YoY shifting of capacity to alternative destinations Summer 21 looks promising as customers are committing to future seasons 1 Key markets excl. Switzerland and Poland; up to 5 August 2020, 2 These statistics are up to 2 August 2020 shown on a constant currency basis and relate to all customers whether risk or non-risk; Statistics based of original planned capacity unless otherwise mentioned 11 TUI GROUP | FY20 9M Results | 13 August 2020
Financial achievements during restart & current priorities TUI GROUP | FY20 9M Results | 13 August 2020
TUI reaches agreement with German Federal Government on additional 2 financial headroom of €1.2bn • TUI Management reaches agreement of €1.2 billion to further strengthen TUI’s position in a volatile market environment and is now better positioned in case of any further long-term travel restrictions and disruptions related to C-19 • Stabilisation package with German Federal Government agreed, consisting of a further KfW loan increasing TUI’s existing RCF 1 by €1.05bn • The drawing of the additional KfW tranche is subject to an issuance of a €150m Convertible Bond subscribed by German Wirtschaftsstabilisierungsfonds (WSF) by 30 September 2020 at the latest • The additional state aid is furthermore subject to a waiver by the bondholders for a potential future limitation of TUI’s financial indebtedness under the €300m Senior Notes (due in October 2021) by 30 September 2020 TUI entered into agreements to cover seasonal swing through Winter 2020/21 and thereafter 1 €1.75bn Revolving Credit Facility; already increased by €1.8bn (KfW April 2020 Tranche) 13 TUI GROUP | FY20 9M Results | 13 August 2020
Details of TUI’s government stabilisation financing measures 2 1 st stabilisation measure 2 nd stabilisation measures RCF – Convertible Bond RCF – Item Apr KfW tranche Aug KfW tranche subscribed by WSF³ €150 million Amount €1.8 billion €1.05 billion Oct 21 / Oct 21 / Min. six years from Maturity Date July 2022 1 July 2022 1 issuance • Financial covenant 2 waiver for Mar • Underlying shares: 10% 4 20; Sep 20 & Mar 21 unchanged • Conversion price: 60% of • Draw down conditions by • Financial covenant 2 prevailing TUI share price 5 30 Sep 20: waiver for Mar 20; Other • Coupon: 9.5% • Issuance of €150m Convertible Sep 20 & Mar 21 agreed • TUI with redemption right Bond once €1.05bn tranche is • Waiver process for Senior Notes redeemed Oct 21 Further No dividend payments and share buybacks, further regarding restrictions regarding executive remuneration conditions and investments as long as WSF remains invested 1 Provided the €300m senior bond is refinanced in time, final maturity date shall be automatically extended from 15 October 2 021 to 20 July 2022; 2 Covenants tested as per March and September: Net debt/LTM EBITDA ≤ 3.0x Interest cover ≥ 1.5x; 3 Issuance of convertible bond until 30 Sep 20 at the latest as draw - down condition for the €1.05bn KfW t ranche, otherwise KfW tranche will be cancelled; 4 Existing conditional capital authorization excl. pre-emption rights will be u sed; 5 min €2.56; 14 TUI GROUP | FY20 9M Results | 13 August 2020
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