Ready to Grow

MAGAZINE READY TO GROW Aktiengesellschaft TUI Group – Financial Highlights € million 2009 / 10 2010 / 11 2011 / 12 2012 / 13 2013 / 14 Turnover TUI Travel 15,755 16,867 17,682 17,796 17,955 TUI Hotels & Resorts 353 363 385 403 465 Cruises 179 201 231 261 281 Others 63 50 33 17 15 Group 16,350 17,480 18,330 18,478 18,715 EBITDA TUI Travel 438 640 745 845 917 TUI Hotels & Resorts 211 216 245 255 267 Cruises 15 20 11 – 19 37 Others – 14 – 25 – 77 – 70 – 49 Group 650 850 924 1,011 1,172 Underlying EBITDA TUI Travel 711 718 834 888 968 TUI Hotels & Resorts 213 235 246 271 267 Cruises 16 20 13 – 3 23 Others – 35 – 50 – 70 – 60 – 49 Group 905 924 1,023 1,097 1,208 EBITA TUI Travel 102 321 441 533 598 TUI Hotels & Resorts 137 144 178 171 203 Cruises 7 11 1 – 30 24 Others – 30 – 32 – 81 – 78 – 51 Group 216 445 539 595 774 Underlying EBITA TUI Travel 485 500 637 641 708 TUI Hotels & Resorts 148 145 179 197 203 Cruises 8 11 3 – 14 10 Others – 51 – 57 – 73 – 62 – 51 Group 589 600 746 762 869 Group earnings Net profi t for the year 114 118 142 187 284 Earnings per share € + 0.30 – 0.01 – 0.16 – 0.14 + 0.31 Dividend € – – – + 0.15 + 0.33 Assets Non-current assets 9,357 9,108 8,668 8,646 8,647 Current assets 5,259 4,384 4,544 4,809 5,379 Total assets 14,616 13,492 13,213 13,454 14,026 Equity and liabilities Equity 2,434 2,548 2,067 1,997 2,517 Non-current liabilities 4,555 4,168 3,773 3,857 3,994 Current liabilities 7,626 6,776 7,373 7,600 7,515 Total equity and liabilities 14,616 13,492 13,213 13,454 14,026 Key ratios EBITDA margin (underlying) % 5.5 5.3 5.6 5.9 6.5 EBITA margin (underlying) % 3.6 3.4 4.1 4.1 4.6 ROIC % 10.49 11.44 15.98 17.14 19.43 Equity ratio % 16.7 18.9 15.6 14.8 17.9 Cash fl ow from operating activities 818 1,086 842 875 1,075 Capital expenditure 516 474 643 821 831 Net fi nancial position 2,287 817 178 68 – 323 Employees 30 Sep 71,398 73,707 73,812 74,445 77,309 Diff erences may occur due to rounding OUR STRATEGIC VISION Embarking on a new era The new TUI AG is a company of opportunities – for our customers, our shareholders and our employees. United under one roof we will have TUI’s unique hotel portfolio, our cruise lines, six European airlines, the distribution strength of our tour operators and online channels, and the advisory skills of our travel agencies all over Europe. The world’s number one integrated tourism Group is a one-stop shop for all the services our guests require. The new Group itself will realise synergies along the entire value chain in tourism. Direct access to markets makes invest - ment in hotels and state-of-the-art cruise liners easier to plan and secures occupancy early in the game. This will enable us to grow faster and develop more travel pro ducts exclusive to TUI. These make us unique and distinguish us from the competition in the “old” world and for the digital future. 2 MAGAZINE — Contents CONTENTS 14 METAMORPHOSIS Growing between ocean and palm trees 26 FUTURE À LA CARTE Sunny prospects: trainees in Turkey Contents — MAGAZINE 3 20 06 THE HAPPINESS TEAM TWO STRONG BUSINESSES All for one: the customer GROWING TOGETHER AS ONE The strategy interview 04 SETTING THE COURSE Prof. Dr Mangold on TUI’s potential TWO STRONG BUSINESSES 06 GROWING TOGETHER AS ONE The strategy interview 12 PROFILE OF THE “NEW” TUI AG The future line-up 14 METAMORPHOSIS Growing between ocean and palm trees 20 THE HAPPINESS TEAM All for one: the customer 26 FUTURE À LA CARTE Sunny prospects: trainees in Turkey 32 SETTING NEW STANDARDS Ahoy there! Below deck with an environment officer 40 HIGHLIGHTS Milestones in a special year 32 42 SUSTAINABILITY SETTING NEW STANDARDS The things that matter to the company Ahoy there! Below deck with an environment officer 71 IMPRINT The Magazine and the Annual Report are also available online: http://annualreport2013-14.tui-group.com 4 MAGAZINE — Setting the course Setting the course »TUI enjoys the best conditions in the inter- national tourist industry for further consolidating its global leadership.« PROF. DR KLAUS MANGOLD Setting the course — MAGAZINE 5 Supervisory Board chairman Professor Dr Klaus Mangold at the Extraordinary General Meeting on 28 October 2014 at the TUI Arena in Hanover 6 MAGAZINE — Two strong businesses growing together as one TWO STRONG BUSINESSES GROWING TOGETHER AS ONE FRIEDRICH JOUSSEN (left) and PETER LONG (right) — MAGAZINE 7 Two strong businesses growing together as one TUI AG and TUI Travel PLC are merging to form the world’s number one integrated tourism group. The marriage between the big hotel and cruise portfolio and the strong tour operator and distribution business will generate benefits for customers, shareholders and the Group’s 77,000 plus employees. Friedrich Joussen and Peter Long are convinced of that. They will manage the “new” TUI as joint CEOs until February 2016. Friedrich Joussen will then take over as sole CEO. Peter Long will take over the helm of the Supervisory Board. Congratulations, gentlemen! You are taking the helm of You are going to manage the operators that specialise in the global market leader in tourism. activity and experience-based travel separately why is that? JOUSSEN: Well, we have taken the first step. We will JOUSSEN: We will manage them in a separate business now focus on implementation. We expect a lot from segment within our Group. We always said during the the merger. A fully integrated tourism group is a unique merger negotiations that in future we intend to focus on opportunity – in terms of our product portfolio, for our core travel operations, and that is the Mainstream our customers, for our shareholders and for the profes- business. Specialist tour operators, such as those offer- sional careers of our 77,000 staff members. The new ing sports or language trips in the United States or ad- TUI will almost certainly be one of the most internation- venture holidays in Australia, are often a long way re- al groups in Europe. moved from our core business. How will your customers benefit from the newly LONG: We are making those specialist operations ac- structured group? countable to our former CFO at TUI Travel PLC, William Waggott, and they will be run separately. As CFO of LONG: Unlike non-integrated tourism providers, we have the former TUI Travel PLC, he knows the business inside far more influence on the overall design of the holiday out. These businesses will be managed for growth and experience, from the search and booking process, to value and Will and the management team will determine flights and transfers and ultimately to the time people how best to do that. spend at their hotel or on their cruise. At every stage, our customers benefit from consistently high quality. What do you have in store to entice your shareholders? JOUSSEN: And they profit from an exclusive offering JOUSSEN: … We aren’t trying to entice them, but rather unmatched anywhere else in the market. We intend to convince them, win their confidence and justify it to build on that in the future as well. We are currently through our performance. The new TUI Group will pursue planning to expand our portfolio by 60 new hotels a coherent strategy. Linking the strong tour operator and grow our cruise fleet by 2019. Mein Schiff 4 to and distribution business at TUI Travel with the premium Mein Schiff 6 are under construction or have been quality hotel and cruise content at TUI AGwill have ordered. And we also have options for additional vessels: two significant advantages. This is a very clear industry Mein Schiff 7 and Mein Schiff 8. rationale. 8 MAGAZINE — Two strong businesses growing together as one »Our shareholders have placed their confidence in us, and we intend to justify that.« FRIEDRICH JOUSSEN LONG: For one thing we are securing more access to tour operators, so that our investment risks will be exclusive content for the Mainstream business, i. e. our smaller. Our goals are to improve occupancy and de- tour operations, and that will enable us to accelerate velop unique products for our customers. This will our growth. Differentiation is the key factor, especially place us in a position to achieve customer and turn- when competing with the up-and-coming Internet over growth. platforms. We are minimising capacity risk for our own hotels and cruise liners through unique product that LONG: We know from our experience with the club customers want and can only get from us. operator Magic Life, which we integrated into TUI Travel, that the integrated approach really does enable us to Can you offer a bit more detail? increase occupancy rates substantially. TUI Travel’s ver- tically integrated Magic Life clubs have an occupancy JOUSSEN: First of all, we intend to make sure more level which is 5 percentage points higher than the level customers are excited by our content. After all, we cov- in TUI AG’s hotel and resorts portfolio for the financial er all segments: from luxury cruises with MS Europa year 2012/13.

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