TUI foregoes dividends and wants to gain trust.

TUI foregoes dividends and wants to gain trust.

The travel group TUI is not planning to pay a dividend to its shareholders for the time being. Chief Financial Officer Mathias Kiep revealed that the company would first like to gain trust and do homework before considering a dividend distribution. CEO Sebastian Ebel emphasized the need to reduce debt and consistently exploit growth opportunities in order to improve financial stability.

Now that the effects of the pandemic on operational business have largely been overcome, the TUI Board of Directors is now concentrating on addressing legacy issues on the balance sheet. One focus is on returning the last tranche of the KfW loan amounting to 550 million euros. It was emphasized that there is no rush when refinancing and the main focus is on optimizing one's cash flow to reduce financing costs and reduce relative debt.

The planned investments amount to 500 million euros annually and serve as a basis for future growth. TUI is expanding its circle of airline partners to increase capacity. By bundling flights with short-term hotel stays and city trips, the company aims to catch up with strong competitors like Booking.

The TUI share experienced a temporary increase of 2.45 percent to 6.85 euros in XETRA trading. With the return to the Frankfurt stock exchange, the board hopes to normalize the shareholder base and attract long-term investors who are striving for a solid dividend. Ebel expressed the desire to establish TUI shares as a growth share and to attract long-term investors who would like to participate in the company's vision.