TUI Deutschland growing faster than the market Expansion of own hotel concepts at long-haul destinations

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1 TUI Deutschland growing faster than the market Expansion of own hotel concepts at long-haul destinations Summer 2011: good economy increases desire to travel - TUI expands its market position Winter 2011/12: medium-haul prices up by an average of two per cent First Sensimar hotel opens at a long-haul destination Guaranteed departure policy now also applies to medium-haul tours New: TUI experts provide advice on tui.com Hanover / Boppard, 26 June This summer, TUI Deutschland is currently winning additional market share and growing faster than the market average. Germany s leading tour operator is enjoying particularly good growth on medium-haul routes. Destinations which have generated additional revenues this summer include Germany, Spain, Turkey and, in the long-haul segment, especially the USA. Moderate price adjustments will be unavoidable in the 2011/12 winter season to recoup the higher costs of jet fuel, food and energy and to compensate for the weaker exchange rates: prices for medium-haul destinations will be raised by two per cent, and by four per cent for long-haul destinations. In view of the growing number of bookings by German customers, TUI plans to increase its airline capacitiy in line with customer demand. At the same time, the company will also expand the number of exclusive hotels which are aimed at specific target groups. Two new hotels will be opened under the Sensimar brand, including the first at a long-haul destination. Other highlights of the winter programme include the expansion of guaranteed departures for medium-haul tours. page 1 of 6 Presenting the 2011/12 winter programmes today in Boppard am Rhein, Dr. Volker Böttcher, CEO of TUI Deutschland, announced: As expected the travel industry benefits from the economic growth in Germany. Cumulatively the number of incoming bookings is up on last summer. TUI Deutschland is growing faster than the market and thusly winning new market share. The brand TUI in particular is expanding its position, thanks to the effects of our exclusive hotel concepts, the strong growth in the speciality tourist segment and the return of families as customers. In the next winter season, TUI will again offer an attractive programme and push ahead with its expansion policy.

2 Growth of twelve per cent for TUI Deutschland in summer 2011 In a dynamic market environment, TUI Deutschland (amongst others TUI, 1-2-FLY, Airtours, L Tur) is growing faster than the overall tourist industry. Sales were up by twelve per cent, as at 10 May 2011, according to TUI Travel PLC. By the end of May, the leader brand TUI was actually up by 13.9 per cent, compared with average growth of 11.5 per cent for the travel-agency based tour operator business as a whole (Source: GfK Travel Insights). Increasing financial optimism in Germany has provided growth impetus for catalogue business and increased the share of early bookers, whereas the share of last-minute bookings is declining. TUI hotel concepts as growth driver TUI benefits above all from the good trend for its own new hotel concepts. Our exclusive hotel brands are meanwhile a reliable key to success, continued Böttcher. The new Puravida Resorts brand has also aroused great interest. The hotel in Kos has achieved occupancy rates of between 85 and 95 per cent for this summer. Sensimar, the hotel concept designed for couples which was introduced three years ago, has also reaped the benefits of five additional hotels and has achieved an average occupancy rate of more than 80 per cent. TUI has also recorded two-figure growth at Best Family, the new hotel category aimed specially at families. Another growth driver is the segment of speciality tourism, with TUI Vital up by more than one third. TUI Camper has won new market shares and sales have risen dramatically, so that this segment has already achieved higher sales than the figure for the whole of The company has also enjoyed strong growth in the segments of family holidays and modular packages. page 2 of 6 Winners and losers in summer 2011 This summer, there are only few destinations which have failed to match last year s performance. Egypt and Tunisia in particular have suffered a substantial drop as the tourist business continues to suffer from the consequences of the political turmoil. Reducing capacities at these destinations at an early stage has proved to be the right tactic, said Böttcher. The main countries to profit from the downturn in North Africa are Spain, Turkey and Germany. The number of TUI customers booking holidays inside Germany is up by twelve per cent. There has been a 13 per cent in-

3 crease in the number of TUI holidaymakers in Spain, while the Balearics have enjoyed the sharpest increase, with TUI customers up by 16 per cent. Demand is driven by a better product portfolio, such as a larger share of all-inclusive packages and the first Sensimar hotel in Majorca. With an increase of 17 per cent, Turkey has enjoyed even better growth. The financial problems in Portugal and Greece appear to have made little impression on potential visitors, with demand up by more than ten per cent in each case. This summer, the Cape Verde Islands continued their amazing success story as the upcoming trendy destination and the number of visitors doubled yet again due to the expansion of the hotel brand RUI. In the long-haul market, customers have shown a keen interest in trips to North America, with sales up by twelve per cent. TUI has recently substantially expanded its products in this highly important segment. Other winners in the long-haul segment include Thailand, Indonesia, Mexico, South Africa, Kenya, the Seychelles, Mauritius and the Maldives. High cost of jet fuel will raise prices in the 2011/12 winter season Price adjustments will be unavoidable in the winter programme in view of the substantial increase in the cost of jet fuel, food and energy, but also to compensate for poorer exchange rates in some cases. Böttcher explains, Following extremely hard bargaining with our partners in the tourist trade, however, we have succeeded in cushioning the price increases and keeping them at a very moderate level. Prices for medium-haul destinations will be raised by around two per cent, in other words in line with the rate of inflation. Prices for Cyprus, Egypt and Tunisia will remain stable, whilst other destinations such as the Canaries, the prime sunshine destination in winter, the Balearics, the Spanish mainland and the Cape Verde Islands will be up by two and 2.5 per cent. The cost of tours to Portugal will be up by 1.5 per cent, Turkey by four per cent. page 3 of 6 Prices for long-haul destinations will be increased by an average of four per cent. Especially for destinations which are further afield, the sharp increase in the cost of jet fuel will affect the cost of the package. Moreover, poorer exchange rates are one of the main causes of the price increases. In winter 2011/12, the Caribbean is one of the destinations which offers particularly attractive prices, which are up by just one per cent and therefore more or less stable. Trips to the USA will also be only mod-

4 erately more expensive, with an increase of three per cent. The prices of trips to Africa, Asia, Australia and New Zealand will also increase. The prices in Germany and Austria, where customers make their own travel arrangements, are also up by just one or two per cent, and thus largely stable. In the coming winter season, TUI will again be offering its customers numerous savings options, first and foremost in the form of attractive discounts for early bookings. Customers planning a medium or long-haul journey can save up to EUR 100 per person and holiday by booking early. All the other savings campaigns will continue to apply. These include primarily the popular fixed prices for children, which mean that package holidays for kids are available for as little as EUR 199. Customers booking a long-term stay of four weeks or more can save up to 30 per cent. Continuing expansion policy In view of the growing number of bookings by German customers, TUI will increase airline capacity in line with demand. In case of extremely high demand, the operator can increase flight capacities on a flexible basis. The range of flights to the Canaries and the Cape Verde Islands in particular will be increased, and also to Turkey. Irrespective of the fundamentally optimistic assessment for North Africa, TUI also expects business in Egypt and Tunisia increasingly to return to normal. At the same time, however, demand is unlikely to reach the level of last winter. page 4 of 6 Sensimar hotel brand opens first location at a long-haul destination In winter 2011/12, TUI will open two more Sensimar hotels and thus continue its growth campaign with its own exclusive hotel concepts. Two new hotels will open in time for the winter season in Fuerteventura and the Dominican Republic. This marks the launch of the new brand s first hotel at a long-haul location, explains Böttcher. The five-star hotel in the Dominican Republic is located at Punta Cana beach and is a new building with 104 suites. The second new Sensimar hotel which is also the second Sensimar hotel in Spain will open at Jandia beach in Fuerteventura. Both Sensimar hotels will be managed by TUI s longstanding partner company RIU. Other highlights include the new five-star hotel RIU Palace Bavaro, also located in Punta Cana in the Dominican Republic.

5 The successful introduction of our guaranteed departure policy will now also apply to the medium-haul segment for the first time. 19 of 36 tours offered are guaranteed to take place, even if booked by only two people. In doing so, TUI gives its customers maximum planning certainty. In addition to its own brands, TUI will simultaneously be expanding its range of exclusive hotels at medium-haul destinations which can only be booked through TUI in Germany. Winter sports: focussing on families This year, TUI is offering its first winter catalogue designed specially for families. The catalogue presents 41 carefully chosen family hotels, some of which offer supervision for children and all-inclusive catering, also for babies. The catalogue also contains detailed information about child-friendly skiing resorts and ski nurseries. Austria is extremely family-friendly: there are 270 hotels where children aged under six can stay free of charge and in many cases also enjoy free board. The TUI snow guarantee again means that customers can rely on good skiing. NEW: experts give advice on the internet In future, TUI will be publishing expert advice from TUI service managers and product managers on the tui.com website and in the various catalogues. This new offer is the logical next step in our online campaign: TUI acts as the customer s personal travel guide and places its unique expertise at the customer s disposal, points out Böttcher. The address is given for each expert so that customers can contact them directly. In doing so, TUI has created a true first in this industry: this contact forum will greatly improve our dialogue with the customer. page 5 of 6 Outlook In winter 2011/12, TUI will continue to enjoy dynamic growth. With its focus on innovation, quality and product differentiation, TUI Deutschland is in an excellent position to offer its customers tailor-made holidays to suit their own individual wishes. In particular, it is expanding its range of exclusive hotels and developing new concepts. Böttcher concludes, TUI has the perfect product to suit any target group. Our customers benefit from a unique variety and we at TUI benefit from growing market shares.

6 is the leading tour operator in Germany with a market share of more than 20 per cent. In addition to the core brand TUI, the TUI Group in Germany also operates numerous other well-known brands such as 1-2-FLY, airtours and the TUIfly airline, as well as the speciality operators Gebeco and L'tur. TUI accordingly covers the entire travel spectrum from premium to individual to budget. TUI Deutschland is a wholly-owned subsidiary of TUI Travel PLC, the largest tourism company in the world. The company is listed on the London stock exchange, represented in 180 different countries and serves more than 30 million customers. page 6 of 6