Swiss-based travel operator Kuoni is selling its tour operating business to concentrate on supplying others in the travel industry.
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The company hass 8,000 employees worldwide. The company said the travel market environment was "likely to remain fast-changing, requiring travel companies to choose distinct development priorities".
Kuoni says all existing and future bookings will be honoured. It plans to focus on markets with what it sees as attractive, long-term growth potential such as Asia, the Middle East and Africa.
It added that by concentrating on providing services for other operators, it hoped to grow significantly faster than the global travel markets which, according to the World Tourism Organisation, would expand by 3.8% a year.
Kuoni said in a statement it "firmly believes that the outbound business can be better developed under new ownership". It also said it would seek assurance about the continuation of the existing business locations and the continued employment of staff.
While preliminary consolidated turnover of Kuoni in its current structure fell by -2.8% in the 2014 financial year to CHF 5 509 million (-0.1% organic), the three divisions which will represent Kuoni’s core business going forward showed a 1.1% increase in turnover to CHF 3 443 million (2.8% organic).
Group Travel has seen a temporary slowdown in demand in the key Japanese market, which caused a 7.4% fall in turnover to CHF 873 million (-6.5% organic). The FIT business (future GTD), which provides accommodation and destination services, showed a 7.3% turnover increase to CHF 1 933 million (8.8% organic).
Meanwhile, turnover at Outbound Nordic declined by -14.1% to CHF 844 million (-9.0% organic) and at Outbound Europe/Asia by -5.0% to CHF 1 343 million (-1.4% organic). The turnover of the DMS segment fell by -12.6% mainly due to geopolitical events to CHF 365 million (-9.0% organic). The VFS Global segment grew by 11.3% to CHF 272 million (14.2% organic).
For full year 2014, Kuoni expects EBIT to be around CHF 85 million, with a net result of around CHF 66 million including accrued charges from the divestiture project. The full year results will be announced as previously stated on 17 March 2015. ■