TT. Tui Travel

TUI AG (TUI1.XE), the German holding company with assets in tourism and shipping, Monday reported its first-quarter net loss narrowed thanks to reduced administrative expenses and improvements in taxes on income and noted bookings in its key market increased notably in the past few weeks.

The Hanover-based company reiterated its outlook of slightly higher adjusted earnings before interest, tax and amortization, or Ebita, for continuing operations for fiscal 2010 and still expects stable adjusted Ebita in its tourism business.

The company changed its fiscal year to bring it in line with that of TUI Travel PLC (TT.LN) and after a short financial year for 2009, the company's financial year now runs from October through September. TUI holds a 52% stake in U.K.-listed TUI Travel, which accounts for the bulk of TUI's earnings.

Its net loss for the three months ended Dec. 31 came in at EUR102.8 million, compared with a net loss of EUR155.1 million in the same period a year ago, clearly beating the EUR153 million net loss forecast on average in a Dow Jones Newswires poll of four analysts.

TUI's first-quarter sales dropped 15% to EUR2.95 billion, in line with a EUR2.95 billion forecast.

TUI shares, which closed Friday at EUR6.36, have climbed about 30% in the past three months, outperforming the Dow Jones Stoxx Europe 600 travel and leisure sector, which rose only 1%. Traders pointed to a power struggle between TUI's management and major shareholder John Fredriksen as a possibility ahead of its annual general meeting Feb. 17.

-By Hilde Arends, Dow Jones Newswires; +49 69 29725 506; hilde.arends@dowjones.com

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