There were things to celebrate in travel operator TUI’s full year numbers – notably a return to profit and a massive rebound in revenue as it benefited from a lifting of Covid restrictions.
Bookings are up on pre-pandemic levels and a big increase in prices will help cushion the impact on TUI of rising input costs.
The question is whether this pricing power lasts. In 2022 holidaymakers have been willing to pay what it takes to get away for the first time in what feels like an age. However, if prices move too high then affordability becomes an issue.
AJ Bell’s Russ Mould said: “This could be a key test for TUI in 2023 and, given people have shifted to booking their holiday at shorter notice to avoid the risk of being caught off guard by disruption, the company has limited visibility on its future business.
“Given the still somewhat perilous state of TUI’s balance sheet, it can ill-afford any negative surprises in the coming 12 months.”