This article is more than 2 years old

This article is more than 2 years old

Tui, the world’s largest travel company, has been hit by the European heatwave that encouraged staycations – but has stuck to its profit forecasts for this year.

Profits at Tui fell 18% to €193m (£174m) in the three months to the end of June. The company also blamed flight delays and cancellations during air traffic control strikes in France, along with the timing of Easter and the weaker pound in the UK.

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However, the company said it was still confident of achieving double-digit earnings growth this year, for the fourth year in a row.

Tui shares fell more than 9% to £14.38 in early trading on Thursday as markets were doubtful of this pledge.

Tui’s chief executive, Fritz Joussen, said: “Tourism companies don’t usually like it when it’s hot – and it is hot. People want to go on holiday when it rains.”

Rival tour operator Thomas Cook said last week profits would be at the lower end of market expectations after the heatwave deterred holidaymakers from booking last-minute trips abroad. It said it still had 20% of summer package holidays left to sell.

However, Tui said its bookings for next summer were 4% ahead of last year “despite the prolonged hot summer”. Spain remains the top destination, followed by Turkey, north Africa, Greece, Cyprus, Croatia and Bulgaria.

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The heatwave, which began for many in May, is Britain’s longest hot spell in at least five years and warmer-than-average temperatures could last until October, according to the Met Office.

Russ Mould, the investment director at the stockbroker AJ Bell, said: “The package holidays part of the business, particularly the UK component, has underperformed – almost certainly due to the World Cup and recent heatwave.

“The cruise and hotels divisions are doing better and this is positive for the company as these activities typically generate higher margins. However, the market appears to be sceptical of Tui’s pledge to achieve full-year guidance, perhaps mindful of its rival Thomas Cook guiding for results to be at the lower end of expectations last week.”