Travel group Tui, which was threatened with insolvency during the pandemic, is paying a dividend once again, after a sharp increase in profit in its 2024/25 financial year that ended on September 30.

Shareholders of the MDax company, whose share price has significantly underperformed the index since the start of the year, are to receive 0.10 euro per share. Chief executive Sebastian Ebel said during the recent earnings press conference that profitable growth forms the basis for resuming shareholder remuneration. In future, Tui plans to distribute between 10 and 20% of adjusted earnings per share.

Adjusted EPS rose strongly by 30% to 1.34 euro last year. Underlying operating profit (Ebit) rose by 12.6% to 1.46 billion euro.

Since the end of the pandemic, Tui has focused on restoring the group’s internal financial strength. Chief financial officer Mathias Kiep described the 20% reduction in net debt to 1.3 billion euro as a milestone for the tourism group. Net debt now equals 0.6 times adjusted Ebit. The company is therefore not far from its target of a factor of 0.5.

Tui shares, recently included in Deutsche Bank’s Top Ten Germany list because analysts see upside potential, have risen by around 17% over the past month.

For the current year, the company expects slightly slower growth. Group revenue, which for the year increased by 4.4% to 24.2 billion euro, is projected to grow between 2 and 4%. For adjusted Ebit, Tui maintains its guidance of an increase between 7 and 10%, a range it exceeded in 2024/25.

The drivers of earnings were the holiday experiences segment, namely hotels, cruises and the young unit Musement, which offers activities at travel destinations. These segments together account for around 85% of the group’s operating profit. Cruises in particular performed strongly with an increase of almost 30%. By contrast, the tour operator division, Markets + Airline, suffered a 34% drop in profit to 200 million euro. Ebel said Tui has considerable room for improvement here, and provided guidance for higher earnings in this division for the current year. The firm will see initial results of the transformation, he added. In Western Europe, the Benelux countries were a drag on earnings, while the Northern region, which includes the key British market, returned to profitability. High transformation costs, especially in IT, as well as delayed aircraft deliveries by Boeing, weighed on results. Twenty new aircraft are expected in 2026.

Tui now wants to tackle costs again. Markets + Airline is to save 250 million euro by the end of 2028. Ebel avoided saying whether this would involve job cuts, but stressed that the group as a whole would not employ fewer people, and that other areas are expanding. He also said that IT costs in the division have passed their peak. At the same time, he announced continued investment in artificial intelligence to strengthen the company’s platform model. Since the end of the pandemic, Tui has benefited from strong pent-up demand for travel. Management now expects the market to calm. For the winter season, bookings show a 1% increase in revenue.