Ratings published by independent rating agencies are a key prerequisite for efficient and flexible access to the capital market. They assist debt capital market investors in evaluating the risk situation of companies and their financial instruments.

Corporate Rating

Corporate Rating Standard & Poor's Moody's 
Long-term CCC+ Caa1
Outlook stable

stable

Latest Update Moody's

January 2021 – Moody’s affirms TUI’s Caa1 rating but updates the outlook to stable from negative.

Moody’s decision to stabilise TUI's rating outlook reflects the sizeable liquidity injection provided by three support packages with a total amount of €4.8 billion. This has largely covered an exceptionally high cashrequirement in fiscal 2020 and provides a significant buffer for potential further cash consumptions in a still highly challenging market environment. The stable outlook reflects the expectation of continued external support in case of the absence of a material recovery of the operating performance, as the coronavirus spreading and travel activity remains highly uncertain in the short term.

Moody's however notes the potential for a medium term recovery of the underlying operating performance and hence further positive rating pressure, in case that the coronavirus outbreak is contained and travel activity resumes to historical levels.

Latest Update Standard & Poor's

January 2021 – Standard & Poor's affirms TUI’s CCC+ rating but updates the outlook to stable from negative.

The stable outlook reflects a balance of risks and opportunities that could drive the rating in either direction in the coming months.

Positively, S&P anticipates potential strong pent-up demand for bookings from leisure travelers once the relatively comprehensive vaccination programs in TUI's main origin and destination markets are implemented. On the other hand, S&P also factor in the current high uncertainty around travel patterns associated with the new lockdown measures, and with the delays in the implementation of vaccination programs, as well as TUI's very high financial leverage and liquidity pressures. With a return to longer term pre-bookings, TUI would benefit meaningfully on the liquidity side and would be able to reduce its financial debt. However, the more risk-averse customers remain, the shorter the pre-booking time and therefore the lower the positive cash effect. If lockdowns and travel restrictions prevent summer bookings, TUI could exhaust its liquidity within the next five-to-six months, which would also increase the risk of a covenant breach and of a debt restructuring.