annual report  accounts for the year ended 30 september 2009
we’re on a journey
it’s been a year of progress
httpara2009tuitravelplccom
tui travel plc annual report  accounts for the year ended 30 september 2009 experienced management team
our management team has a track record of delivering long term growth whilst managing the
business through significant changes in consumer demand we have real strength and depth
throughout our management teams across the organisation see our colleagues on page 22
marketleading brands
we have some of the most recognised and highly trusted brands in the industry which drive
customer retention reduce the cost of customer acquisition and are attractive to our
accommodation providers and distribution partners see distribution  brands on page 15
marketleading positions
in the mainstream sector we are either the number one or number two positioned tour
operator in almost all of our source markets including the uk germany france belgium 
the netherlands and the nordic countries
market consolidation
consolidation in some of our key markets has improved the structure of the industry and 
has reduced the risk of profit volatility historically driven by oversupply of capacity
competitive advantage
we buy over 150 million bednights per year making us one of the largest distributors of
accommodation globally our scale gives us a competitive advantage when negotiating with
suppliers allowing us to offer excellent value to our customers
flexible business model
the inherent flexibility of our model means that we are able to carefully manage our capacity
to react to changes in demand reducing the volatility of our profitability through the cycle
synergies
we have identified £200m of synergy benefits as a result of the merger in 2007 and are 
highly confident of achieving this target by 2009 we had delivered £120m of synergy
benefits and have £80m still to come see people  operational effectiveness on page 16
turnaround potential
since the merger we have successfully executed a number of strategic actions to improve
margins in underperforming businesses including our scheduled flying operations in the 
uk and germany and our canadian tour operator we have a number of businesses where
margins continue to be diluted by strategic and business model issues and solving these
represents an opportunity for substantial future margin improvement
specialist sectors
in excess of onethird of our profits are generated by our portfolio of niche specialist
businesses which enjoy high organic growth and margin characteristics and often display
counterseasonal profitability growth in these sectors is augmented by our highly successful
acquisition strategy where we identify new market niches and build substantial market
positions this portfolio of businesses is unique and cannot be replicated representing 
a clear differentiation from our competitors see product  content on page 14
emerging markets
we have an existing presence in the four major emerging markets of russia brazil china and
india the growth potential of these markets is substantial and we are well positioned to take
advantage of this particularly in russia see growth  capital allocation on page 17
10 reasons to invest 
in tui t ravel plc
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
tui t ravel plc is the 
world’s leading leisure 
travel company 
find our 2009 annual 
report online at
httpara2009tuitravelplccom
ifc group at a glance
ifc the investment case
02 tui t ravel overview
04 our structure
06 highlights
08 strategic overview
08 market overview
10 chairman’s statement
11 chief executive’s statement
12 chief executive’s interview
14 our strategy
18 key performance indicators
20 principal risks
22 responsible leadership
26 sustainable development
30 business performance
30 group performance
34 segmental performance
42 current trading
44 governance
44 board of directors
46 directors’ report
48 statement of directors’ responsibilities
49 corporate governance report
53 remuneration report
63 independent auditors’ report
64 financial statements
64 consolidated income statement
65 consolidated balance sheet
66 consolidated statement of cash flows
67 consolidated statement of recognised 
income and expense
68 notes to the consolidated financial statements
123 company balance sheet
124 notes to the company’s financial statements
128 shareholder information
128 threeyear financial history
129 shareholder discount
130 contacts and advisers
131 glossary of key terms
132 index
tui travel plc annual report  accounts 2009 01
wwwtuitravelplccom
the annual report contains forwardlooking statements that are subject to 
risk factors associated with amongst other things the economic and business
circumstances occurring from time to time in countries and sectors in which the
group operates it is believed that the expectations reflected in these statements
are reasonable but they may be affected by a wide range of variables which could
cause actual results to differ from those currently anticipated
contents who we are
tui travel plc tui travel or the group was created on 
3 september 2007 from the merger of first choice holidays plc 
and the t ourism division of tui ag it is the world’s leading leisure
travel company operating in over 180 countries with more than
30 million customers in 27 key source markets
tui travel has over 200 brands which are comprised of market
leading mainstream brands and specialist travel businesses 
tui travel is focused on providing customers with a wide choice 
of differentiated and flexible travel experiences to meet their
changing needs
tui travel is headquartered in the uk and employs approximately
50000 people it is listed on the london stock exchange in the
ftse100 and has the ticker code ‘tt’
group at a glance
tui t ravel overview
02 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
making travel 
experiences special
creating superior shareholder value by
being the leading global leisure travel group
providing customers with a wide choice
of differentiated and flexible travel
experiences to meet their changing needs
product 
 content
distribution
 brands
people 
operational
effectiveness
growth  
capital
allocation
customer obsessed value driven playing to win responsible leadership
vision
go to
page 14
go to
page 14
go to
page 23
strategic goal
strategic
imperatives
values
our strategy group at a glance strategic overview business performance governance financial statements shareholder information
where we operate
tui travel is a truly global player operating 
in 27 key source markets the two additions
from last year include market entrances in
ukraine and new zealand
our 27 key source markets
tui travel plc annual report  accounts 2009 03
wwwtuitravelplccom
australia
austria
belgium
canada
china
czech republic
denmark
finland
france
germany
hungary
india
ireland
italy
luxembourg
netherlands
new zealand
norway
poland
russia
slovenia
spain
sweden
switzerland
ukraine
united kingdom
united states
our key brands
tui travel operates under more than 200 brands a selection of our wellknown brands 
include tui thomson fritidsresor nouvelles frontières the moorings quark
lateroomscom hotelbedscom hayes  jarvis and turchese
tui operates in the german source
market and is the marketleading tour
operator brand
wwwtuicom
thomson is the leading uk tour
operator which also offers flights 
and accommodation
wwwthomsoncouk
fritidsresor is a tour operator and 
retail business in the swedish 
source market offering package 
tours to the mediterranean and
destinations worldwide
wwwfritidsresorse
nouvelles frontières is the leading
multispecialist and multichannel 
tour operator in france offering a wide
range of holidays and destinations 
wwwnouvellesfrontieresfr
the moorings is the world’s premier
yacht charter company and offers hire
of its customdesigned yachts in north
america uk france and germany
wwwmooringscom
quark expeditions is the world’s leading
operator of expedition cruise voyages
to the polar regions
wwwquarkexpeditionscom
laterooms is the hotel industry’s
leading late availability database
offering over 500000 accommodation
deals directly to consumers across 
the uk and worldwide 
wwwlateroomscom
hotelbeds is a leading businessto
business provider of destination
services and accommodation online 
to wholesalers travel operators and
travel organisers
wwwr2hotelbedscom
hayes  jarvis operates in the uk source
market and creates specialist holiday
itineraries for discerning travellers to 
55 destinations worldwide 
wwwhayesandjarviscouk
turchese offers holidays to europe 
the mediterranean area and the 
middle east and operates in the italian
source market 
wwwturcheseit mainstream is the largest sector in terms of size financial performance and employee numbers it comprises
leading tour operators and ‘power’ brands and operates a fleet of 146 aircraft and circa 3500 retail shops
there are three divisions
northern region
the northern region comprises the distribution
tour operating businesses and airlines in the uk
and ireland the nordic countries and canada the
uk operates some of the best known and loved
travel brands including the uk’s third largest airline
thomson airways the nordics comprises the
markets of sweden norway denmark and finland
the nordics has number one brands in all markets
except finland where it is number two in canada
the brand positioning is being strengthened with
the proposed strategic venture with sunwing
top selling brands
thomson first choice
and fritidsresor
customer numbers
71m
top three destinations
balearics greece and turkey
group at a glance
our structure
tui travel is organised and managed through four sectors – mainstream activity specialist 
 emerging markets and accommodation  destinations the chart opposite illustrates the
underlying operating profit mix by sector for the year ended 30 september 2009
04 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
mainstream sector
for further information 
see page 34
key activities
central europe
central europe comprises the distribution tour
operating businesses and airline in the source
markets of germany austria switzerland and
poland germany is our largest source market 
in germany and austria tui is the marketleading
brand the businesses are focused on providing 
a unique service and great products at the best
value to our customers
top selling brands
tui 12fly and l’tur
customer numbers
97m
top three destinations
spain germany and turkey
western europe
western europe comprises the distribution tour
operating businesses and airlines in france belgium
and the netherlands in each country the brands
have marketleading positions based on quality 
of service and price
top selling brands
jetair holland international 
and marmara
customer numbers
52m
top three destinations
spain greece and turkey
by customer numbers group at a glance strategic overview business performance governance financial statements shareholder information
tui travel plc annual report  accounts 2009 05
wwwtuitravelplccom
this sector has over 40 activity travel businesses
that operate under five divisions – marine
adventure ski student and sport each of these
divisions has marketleading positions the
adventure businesses take more customers 
to iconic adventure destinations than any other
operator the sport businesses are leaders in
supporterled cricket and rugby tours in australia
and the uk while the student businesses
encompass everything from the traditional 
school trip to france to trek holidays for groups 
of young adults in the himalayas this sector also
includes the leading yacht brands in europe and 
the us and the world’s largest ski operator
top selling brands
crystal ski moorings and le boat
customer numbers
11m
top three destinations
france austria and italy
activity sector
for further information 
see page 39
specialist 
emerging markets
sector
for further information 
see page 40
accommodation 
destinations sector
for further information 
see page 41
key activities
the specialist  emerging markets sector is an
international portfolio of travel businesses focusing
on specific destinations premium travel experiences
or particular customer demographic segments 
often with differentiated and exclusive product 
the sector consists of 40 businesses operating 
from north america europe and most recently
emerging markets such as russia and ukraine
top selling brands
mostravel t urchese and 
hayes  jarvis
customer numbers
20m 
including russia  ukraine
top three destinations
us egypt and italy
the accommodation  destinations sector ad
sells and provides a range of services in destination
to tour operators travel agents corporate clients
and direct to the consumer worldwide services
include hotel accommodation transfers excursions
round trips organising meetings incentives
conferences and events mice cruise handling 
as well as integrated website solutions for our
customers ad is structured along key business
lines – business to business b2b and business 
to consumer b2c
top selling brands
tui used by a number of incoming
agencies including tui españa 
tui hellas hotelbedscom and
lateroomscom
customer numbersroomnights
269m
top three destinations
spain uk and portugal
by customer numbers
650
126
67
126
31
mainstream sector
activity sector
specialist  emerging markets sector
accommodation  destinations sector
joint ventures revenue
flat £13863m
underlying operating profit
11 £443m
underlying profit before tax
15 £366m
underlying earnings per share
17 238p
dividend per share
10 107p
the financial highlights are underlying results for the years ended 30 september 2009 and 30 september 2008 underlying operating profit excludes
separately disclosed items amortisation of ifrs 3 intangibles goodwill impairment and taxation of results of the group’s joint ventures and associates
underlying profit before tax also excludes separately disclosed financial expenses underlying earnings per share excludes the same items as excluded
from underlying profit before tax net of related taxation
08 97p
09 107p
08 204p
09 238p
08 £319m
09 £366m
08 £398m
09 £443m
08 £13932m
09 £13863m
group at a glance
financial highlights
06 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
• the group delivered a strong performance despite significant
economic headwinds
• the merger integration is progressing well and we are on track 
to deliver £200m in synergy targets by 2011
• announced significant transactions in germany between tuifly
and air berlin and in canada with the proposed strategic venture
with sunwing
• building a marketleading presence in russia  cis through 
a joint venture with sgroup capital management
• completed 11 bolton acquisitions in highgrowth niche
specialist businesses
• raised £490m of financing through a convertible bond and
additional bank facility
operational highlights
tui travel plc annual report  accounts 2009 07
wwwtuitravelplccom the economic environment
it became clear in 2008 that the world’s financial
system was in jeopardy as many of its leading banks
were suffering liquidity issues and incurring losses
leading them to be significantly undercapitalised 
in early 2009 all indicators pointed towards an
increasingly challenging operating environment with
the deterioration of the world economy financial
uncertainty and low consumer confidence
additional challenges became apparent with the
continued volatility of currency and fuel prices as
well as the outbreak of the h1n1 virus
more than one year on from the banking crisis we
are seeing some indications of economies beginning
to bottom out but economic data is still mixed
there appear to be signs that the government’s
intervention in the banking crisis is starting to take
effect and there is improving consumer confidence
and an increasing willingness to spend however
unemployment is predicted to rise to 11 in the
uk in the second half of 2010 and although there
has been recent improvement in the us
unemployment remains at 9 oxford economic
forecasting september 2009 in germany and
france unemployment is expected to continue 
to rise in 2010 remaining high until 2012 during
2009 the us and the major european economies
uk germany and france have seen some
quarterly increases in gdp however annual gdp
growth is not expected to resume until 2010
the leisure travel market
historically tourism has shown resilience in
deteriorating economic situations such as the
recession in the early 1990s and short term shocks
such as 911 and the sars health scare however
after a period of strong growth tourism has not
been immune to the current financial crisis
according to the united nations world t ourism
organisation unwto the number of international
tourist arrivals worldwide reached 500 million in the
first seven months of 2009 down from 540 million
in the same period of 2008 economic conditions
combined with the uncertainties brought about by
the h1n1 virus are expected to continue to impact
tourism demand in the short term though the rate
of decline is anticipated to ease during the remainder
of 2009 and international tourism is forecast to
decrease by 5 for the full year 2009 the unwto
expects moderate growth for 2010
over the past couple of years we have seen
consolidation of the major european players 
the mergers of tui t ourism and first choice 
and thomas cook and my travel have delivered
consolidation primarily in the uk market there
have also been several high profile collapses of
airlines and tour operators globally businesses 
with weak financial models and poor capacity
management have not survived those businesses
that have marketleading brands are financially
secure and have flexible business models have
proven more resilient tui travel has continued 
to weather the challenging economic environment
the group’s financial performance has continued 
to meet the board’s and the market’s expectations
our business model allows us to closely align our
supply to demand and we also have a high degree
of flexibility which allows us to manage and adapt
quickly to changing market conditions and
customer needs
the political climate
t ourism is one of the most heavily regulated
industries as a global organisation tui travel has 
a public affairs team that works with governments
across our key source markets to address issues
that impact our industry and our customers
the package travel directive is one issue that has
come to the fore following the collapse of a number
of airlines including xl airways and one on which
we have been campaigning across our key markets
the package travel directive came into effect in
1990 and its provisions were introduced into uk 
law through the package travel regulations in 1992
the package t ravel directive set out travel organisers’
responsibilities to their customers in the event that
an operator fails in the eu anyone who offers
package holidays must comply with the package
travel directive
following campaigning by tui travel and the
industry the european commission has recognised
that the package travel directive needs to be
updated in line with the significant changes that
have taken place in the industry over the last
17 years most notably the use of the internet 
for booking holidays we are ensuring that tui
travel’s views on this regulation and the protection
customers should expect are heard as part of 
this peter long has met with the european
commissioner for consumer affairs to submit 
our recommendations
the sustainability challenge
travel and tourism accounts for 11 of the world’s
gdp and 12 of its exports
1
around 50 of the world’s least developed countries
rely largely on tourism for economic development
however travel and tourism are responsible for
around 5 of global carbon dioxide emissions
2
as a leading tour operator tui travel aspires to 
lead the travel and tourism sector and to lobby for
sustainability to be embraced as a business issue
on which the future health of the industry depends
as a tourism group we take our responsibilities very
seriously and are working to ensure that sustainable
strategic overview
market overview
08 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
development aligns with the group’s key strategic
priorities our challenge is to understand how our
industry can optimise its social economic and
environmental benefits for all concerned tui
travel’s goal in this respect is to make travel
experiences special by providing holidays that cause
minimal environmental impact respect the culture
and people of destinations and offer real economic
benefit to local communities see sustainable
development on page 26
consumer sentiment
our customers continue to look forward to their
annual holiday they continue to want to travel
abroad experience new countries cultures and
sunnier climates we are seeing the following
customer trends
brand strength
customers are loyal to reputable established 
highquality brands ’power brands’ as they seek 
to derisk their holidays and book with a tour
operator that gives full financial protection we 
have some of the most recognised and highly
trusted brands in the industry see distribution 
 brands on page 15
product innovation and development
customers continue to be more discerning in their
holiday decisions wanting differentiated products
and value for money we are developing a portfolio
of exclusive products that no competitor can 
match or replicate and which is tailored to include
additional services and facilities that our customers
want on their holiday for further information on
differentiated products see product  content 
on page 14
we have seen a trend towards all inclusive packages
due to customers seeking financial certainty and
wanting to know exactly what their holiday is going
to cost in the uk we have experienced a 33
increase in demand and in germany a 50 increase
in 2009 versus 2008
the flexibility of our travel products has also
become a key customer requirement with an
increase in demand for 10 or 11night holidays
wider choices of departure dates and flights from
regional airports
our customers care about the environment and
expect a quality tour operator to be addressing
these issues on their behalf see sustainable
development on page 26 in the largest
mainstream markets germany and the uk 
we have launched green brochures featuring 
only holidays that meet the highest social and
environmental criteria
we continue to listen to our customers by creating
new holiday experiences to meet and beat their
expectations
destinations
a number of noneu countries including egypt 
and turkey continued to grow strongly in popularity
in 20082009 the number of our customers
travelling to the eurozone has decreased but these
destinations including the balearics mainland
spain portugal and greece still remain our top
short haul destinations for long haul destinations
the dominican republic thailand and the united
states continually provide resorts that are popular
and value for money despite the impact of swine
flu mexico has recovered well following investments
and incentives by the local government to attract
tourists back to the resorts new destinations
introduced in 2009 included kenya and canada
emerging markets
as our traditional mainstream markets mature we
continue to look to new markets for growth during
the year we committed to investing in russia  cis
with our joint venture partner sgroup capital
management our aim is for tui russia  cis to
achieve a marketleading position we also have an
existing presence in brazil china and india and
these markets are being investigated and evaluated
for further growth opportunities see growth 
capital allocation on page 17
market outlook
although customers are booking later in the 
current economic climate there is still a strong
demand from our customers for their main holiday
we anticipate that market conditions will remain
challenging and expect the later booking pattern to
continue in the next financial year in the long term
there is every reason to believe that the demand
for international travel will continue to grow strongly
after the effects of the current economic downturn
have receded particularly in emerging market
economies and we are well placed to capture 
this growth
tui travel plc annual report  accounts 2009 09
wwwtuitravelplccom
1 united nations world t ourism organisation unwto t ourism
satellite accounts tsa
2 united nations world t ourism organisation unwto united
nations environment programme unep and world meteorological
organization wmo october 2007 climate change and t ourism
responding to global challenges madrid t wo years on from the formation of tui travel we
have made substantial progress in implementing
our strategic imperatives and delivering our roadmap
we are on track to achieve our synergy target and
have successfully resolved a number of key strategic
issues identified at the time of the merger some
underperforming businesses remain and we are
confident that we can turn these around we are
focusing increasingly on the significant growth
opportunities identified within both the mainstream
and specialist sectors which i believe will deliver
superior and sustainable long term growth
results
the group has achieved an 11 increase in
underlying operating profit to £443m 2008
£398m on slightly lower revenue of £13863m
2008 £13932m underlying profit before tax 
is up 15 to £366m 2008 £319m underlying
earnings per share increased by 17 to 238p
2008 204p the group statutory loss before
taxation was £52m 2008 £267m
dividends
the board is recommending a final dividend of 77p
per share on 19 may 2009 the board recommended
an interim dividend of 30p per share thereby
resulting in a full year dividend of 107p per share
previous year 97p the group has a progressive
dividend policy and will look to maintain underlying
dividend cover at just over two times
board
christoph mueller resigned as aviation director 
and subsequently left the board in may 2009 
in october 2009 horst baier was appointed as a
nonexecutive director the board is composed of
a majority of independent nonexecutive directors
colleagues
providing special holiday experiences to our
customers is down to the hard work and enthusiasm
of our colleagues our colleagues are at the heart of
achieving our objectives and successes and we have
outstanding talent at every level of the business 
i thank them on behalf of the board
sustainable development
sustainability is important to our customers
colleagues and ultimately our shareholders we are
aware of our responsibility to manage our impacts
on the environment and people climate change is
the greatest environmental challenge facing humanity
and we recognise that we contribute to global
carbon emissions particularly through our aircraft
operations we work hard to reduce this impact and
i am pleased to report that our emissions compare
favourably with our peers 
dr michael frenzel
nonexecutive chairman
strategic overview  chairman’s statement
growing in strength
we have again delivered a strong set of results against a backdrop of challenging economic
conditions and exceptional cost inflation from jet fuel prices and currency movements 
our performance in 2009 proves that the flexibility and diversity of our model works and 
is testament to the strength of our management team and our marketleading brands
10 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
350
300
250
200
150
100
tui t ravel plc
ftse 100
ftse 30100
tui travel plc shares
listed 030907
300904 300905 300906 300907 300908 300909
total shareholder return
tui travel plc v ftse 100  ftse 30300
dr michael frenzel
nonexecutive chairman group at a glance strategic overview business performance governance financial statements shareholder information
we are very proud that tui travel is the world’s
leading leisure travel company taking over 30 million
customers on holiday each year we have produced
another good set of financial results this year with 
a £45m increase in underlying operating profit 
to £443m and an improvement in underlying
operating margin of 30 basis points to 32
our performance is particularly impressive as it has
been achieved in spite of the higher levels of cost
inflation and the challenging economic backdrop
which has resulted in both higher unemployment
and declines in consumer confidence in all source
markets the group’s flexible business model and
careful capacity management has meant we have
been able to successfully manage the businesses
through this difficult period our strong brands
together with ongoing product innovation and
development have also meant that we have
continued to maintain marketleading positions and 
to deliver new holiday experiences for customers
climate change has been one of the most talked
about topics this year and in the leisure travel
industry it is without doubt one of the largest
challenges we face tui travel is the first major 
tour operator to commit to carbon reduction targets
and i have met with business leaders to discuss 
the business community’s response to climate
change we will continue with our commitment 
to sustainability and strive to ensure that it aligns
with our strategic priorities
tui travel’s clear strategic goal is to create superior
shareholder value by being the world’s leading
leisure travel group providing customers with the
widest choice of differentiated and flexible travel
experiences to meet their changing needs this 
year we have focused on delivering growth and
shareholder value by growing our mainstream
businesses’ margins and building our portfolio of
specialist businesses we have made substantial
progress in delivering both these targets and we 
are confident there is more growth to come
finally all of our achievements this year could not
have happened without the hard work and dedication
of our 50000 colleagues and i would like to thank
them personally for their contribution
peter long
chief executive
strategic overview  chief executive’s statement
a clear strategic goal
welcome to tui travel plc’s 2009 annual report this year we have taken the step of putting 
our annual report  accounts fully online reflecting our ongoing commitment to sustainable
development and the fact that over 70 of our shareholders will be receiving it electronically 
this year we hope you enjoy reading and hearing about tui travel’s achievements
tui travel plc annual report  accounts 2009 11
wwwtuitravelplccom
peter long
chief executive
view the ceo’s interview online
watch the ceo’s interview online at 
httpara2009tuitravelplccom in what has been a very economically challenging
year in the global market place where we have
experienced the deepest and longest postwar
recession rising unemployment loss of consumer
confidence and increased cost pressures i am
delighted that tui t ravel has achieved strong results
for me if there is one thing that really stands out 
it is the dedication and commitment of all our
colleagues at tui t ravel
i believe that we have the best management team
in the industry and this is borne out by the way
businesses perform in times of adversity it is one
thing to perform well when the trading environment
is positive or benign but it is quite another thing to
produce good performance when times are tough
we also have a good mix of tour operator and
functional experts across the group which creates
the right balance to successfully manage what is 
a huge complex international business
it is not only about the team at the top though 
we have identified our talent pool and considerable
time and commitment is going into developing our
leaders of tomorrow i have had the opportunity 
of spending time with them this year and what 
a fantastic group of colleagues they are it is both a
privilege and reassuring to know that as the business
grows we will have the right team to grow with it
it’s been very interesting to see the reactions of 
our customers within our different source markets
during this period of economic uncertainty
the first market where we saw a marked reaction
was in the united states the subprime mortgage
issue was a significant factor and unemployment
rose much more quickly than in our other source
markets and consumer confidence was lower much
earlier we experienced a marked drop in bookings
across a number of our businesses having taken
the pain earlier however the us market is now
coming back strongly and the businesses are
performing accordingly
in the uk we have experienced a later booking
pattern – if someone is concerned about whether
they will have a job or not it’s not surprising that
they delay booking their annual summer holiday
they did however eventually book and because
we had ensured that we aligned capacity with
demand although they were booking later we
weren’t having to discount the price
how are the different markets responding to
the current economic climate
what are the highlights of this year for you
there is evidence that consumer confidence in the uk
is improving as we’re seeing strong demand for late
bookings this winter furthermore i am encouraged
by our booking pattern for summer 2010
in germany and to a lesser or greater extent our
other european source markets we think it could
be slightly different the fiscal measures put in
place in these countries means that they have not
experienced the unemployment levels that we have
seen in either the us or the uk once these
measures cease we may see unemployment rise
we are therefore planning cautiously for next year
in these source markets although there are positive
signs in a number of these countries
we have experienced both lower demand and
significant cost inflation across the group which 
we managed through our flexible business model
carefully aligning capacity with demand allowed 
us to achieve our required load factors and also
ensured that there was no excessive discounting 
in the lates market despite the later booking trend
we have identified a number of businesses across
the group that were or are underperforming and
we have taken or are taking appropriate steps to
address these
in germany we have concluded a transaction with
air berlin who will take over our city pairs business
this allows us to exit an operation which made
significant losses in 2008 this deal makes strategic
sense for both us and air berlin we are also
improving our product mix in germany which will
deliver higher margins and have plans in place to
increase our controlled distribution
in france within nouvelles frontières we are
rationalising the product range to ensure that we
operate programmes of significant scale to key
destinations corsair our long haul scheduled
airline was hit by a series of sociopolitical events 
in a number of its key destinations and we are
continuing to review its business model and
strategy our retail operation in both nouvelles
frontières where we were subscale and marmara
where we relied heavily on third party agents
needed to be addressed we are now selling
marmara product through our nouvelles frontières
and havas retail operations and the transaction
with carlson wagonlit travel after the year end
gives us the scale we require
in canada which is an extremely competitive
market with significant overcapacity we have a
weak market position and made a loss of £24m in
2009 having reviewed the strategic alternatives for
what steps have you taken to further 
improve the group’s business performance
strategic overview  chief executive’s interview
an interview with 
chief executive peter long
12 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
canada we recently announced a strategic venture
with sunwing a leading tour operator in canada 
the transaction once completed will strengthen
our position in the canadian market and bring 
a number of strategic and financial benefits to 
the group
for us it’s all about delivering sustainable longer
term growth and our flexible and efficient business
model remains key to what we do
we will be focusing on continuing to improve those
areas of the business that are underperforming
increasing our differentiated and exclusive product
and getting the right mix of controlled distribution
across the whole of our mainstream sector
we will also look closely at how we shape our long
haul programme being the european launch customer
for the boeing 787 we will ensure that we take full
advantage of the competitive advantage this brings us
within our specialist sectors we have a unique
portfolio that is impossible to replicate and our
focus will be on driving organic growth in our
existing businesses and maximising further the
merger integration opportunities we have we will
expand into new source markets with specialist
products just as we did with le boat in germany
we continue to identify new market niches that
offer highgrowth potential and where we can easily
establish a significant position in russia and ukraine
we will leverage and grow our existing platforms as
well as investigating further the potential of other
emerging markets
travel and tourism is the world’s largest industry
and has grown and changed rapidly over the last 
30 years in 1979 there were 270 million international
tourist arrivals this has risen to nearly a billion
today and the prediction for 2020 is 16 billion
the mainstream tour operators opened customers’
eyes to safe travel beyond one’s own country and
people are more adventurous today it started with
spain but now customers are more confident and
will happily go to destinations like egypt turkey the
dominican republic and mexico it’s not only about
a sun and beach holiday many of our group’s
customers want to go on experiential holidays like
sailing trekking in the himalayas safaris or polar
expedition cruising and these will continue to
become even more popular
how do you see the leisure travel market
developing in the future
how will your strategy and business model
develop over the next couple of years
the new generation of aircraft like the boeing 787
will allow our customers to fly even further afield to
new destinations in aircraft that are more fuel
efficient offer greater comfort and are less
damaging to the environment than today’s aircraft
we are in a constantly changing industry and if we
stand still we will be left behind we put our customers
at the heart of everything we do and not only deliver
what they want today but continue to innovate in
order to deliver what they will want tomorrow
every year we face different challenges and we deal
with them be they geopolitical natural disasters or
economic but for me there are two key challenges
that we are addressing one is carbon reduction and
the second is regulation
we operate in a high carbon industry although 
we are a tour operator first and foremost we also
have a fleet of 150 aircraft to take our customers
on holiday and unfortunately today there is no
alternative to jet fuel mass production of second
generation biofuels which seem more viable 
are still a considerable number of years off we
therefore have to do all we can to reduce our
carbon dioxide emissions ourselves and are making
a significant investment in new technology like the
boeing 787 we have committed to reducing our
carbon emissions from our fleet by 6 by 2014
we are supportive of the inclusion of aviation in 
the european emissions trading scheme ets but
believe there should be a global emissions trading
framework for aviation which channels monies
raised from auctioning emissions allocations into
environmental solutions rather than national coffers
we also don’t want to see the aviation industry
being hit twice both by national governments in 
tax raising schemes and also by ets
as a tour operator we are heavily regulated and we
do not have an issue with that what we do have an
issue with however is that competitors in the same
market competing for the same customers and the
same business should be regulated in the same way
and this isn’t the case we welcome the fact that
the european commission is looking at revising the
package travel directive which has been in place for
nearly 20 years and does not take into consideration
the way the leisure travel market has changed
particularly in the last six or seven years with the
low cost carriers and online travel agents financial
protection also needs to be addressed especially in
the light of the number of airline failures that we
have seen and may well continue to see
what are the challenges tui travel is facing
tui travel plc annual report  accounts 2009 13
wwwtuitravelplccom
view the ceo’s interview online
watch the ceo’s interview online at 
httpara2009tuitravelplccom summary
• different products to our competitors
and unique in the marketplace
• high customer retention and repeat 
booking rates
• earlier booking trends
differentiated content is a central pillar of our
product and content strategy we are developing a
portfolio of exclusive products that no competitor
can match or replicate and which is tailored to
include additional services and facilities that
customers want on their holiday every one of our
businesses offers products that are tailored to meet
the holiday needs and tastes of its customers in
the mainstream sector the level of differentiated
product has increased over the last year and
currently represents 37 of total holidays we 
have specific targets in each sector to continue 
to increase this level of differentiation and are
constantly reviewing and evolving product content
the mainstream differentiated products in the uk
include sensatori designed for couples and first
choice holiday villages designed for families in
germany we offer sensimar a 5star spa concept
for couples and robinson clubs for families in the
nordics our blue villages offer an excellent
experience for families
the portfolio of differentiated content not only
increases our competitive advantage by distinguishing
us from the competition it also drives higher
margins underpinning our plans to improve
underlying operating margins differentiated
products have an earlier booking profile which
increases yields and removes pressure in the lates
market while customers also benefit from a more
addedvalue unique experience feedback shows
that customers appreciate the quality and value of
these products and higher satisfaction levels drive
repeat bookings and customer retention
strategic overview  our strategy
strategic imperatives
we have a clear strategic goal to create superior shareholder value by being the world’s leading
leisure travel group providing customers with the widest choice of differentiated and flexible
travel experiences to meet their changing needs in order for us to achieve our strategy we 
are focused on four areas – product  content distribution  brands people  operational
effectiveness and growth  capital allocation we measure the delivery of these four areas 
by our key performance indicators see kpis on page 18
14 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
imperative 1 product  content group at a glance strategic overview business performance governance financial statements shareholder information
summary
• highly trusted brands that provide value 
and quality
• broadening customer choice
• building our customer relationships
our highly trusted brands provide excellent 
value for money and drive customer loyalty and
repeat bookings we have marketleading brands 
in the mainstream sector including tui thomson
first choice jetairfly fritidsresor holland
international arke nouvelles frontières and
marmara in the specialist sectors we have 
wellknown niche brands that have marketleading
positions including hayes  jarvis sovereign
citalia the moorings crystal ski lateroomscom
and hotelbedscom
our aim is to provide customers with a wide choice
of holiday options that meet their preferences and
a convenient range of booking options by securing
direct access to customers we can manage and
deliver the whole holiday experience from booking
with an agent in our travel shops online or via one
of our call centres to inresort and aftersales
service whilst driving customer satisfaction and
ultimately customer loyalty
in each source market the distribution of products
is tailored to reflect different customer preferences
and market dynamics each source market has its
own distribution strategy which aims to reduce
costs by building controlled distribution through 
the efficient operation of retail shops the use of
the internet as a research and booking tool and by
the utilisation of call centres
in the mainstream businesses our leading brands
drive bookings through controlled distribution
capability which is made up of three main channels
a retail network of circa 3500 shops an online
booking capability for all major brands and call
centres in the uk for instance where there is a
high propensity to purchase online we have invested
heavily in web capability in addition to increase
control of late and online sales we have launched 
a latedealscouk website and continue to maximise
the efficiency of our channels by utilising the down
time in shops to enable staff to work as a virtual 
call centre in france there is a higher propensity 
to purchase through more traditional travel agents
and we are expanding our retail network both
through owned and franchise agencies we have
also increased controlled distribution for the
marmara brand by building its internet offering 
and selling it through our network of nouvelles
frontières shops and havas voyages retail stores
tui travel plc annual report  accounts 2009 15
wwwtuitravelplccom
imperative 2 distribution  brands summary
• our colleagues are key to our success
• flexible business model that can react 
to demand changes
• development of sophisticated capacity 
and yield management systems
• underlying operating profit margin up 
30 basis points from 29 to 32
• integration progressing well with total
synergies upgraded to £200m
the skills and expertise of our colleagues are the
key to our success across the group we have a
unique breadth and depth of experience with
innovative entrepreneurs in our specialist
businesses skilled tour operators in mainstream
functional experts at the centre and a highly
experienced and respected international
management team our aim is to motivate and
engage our teams to deliver outstanding customer
experiences and results for our businesses t alent
across the group is reviewed regularly with a focus
on retaining and developing individuals to drive the
business forward see our colleagues on page 22
we have a flexible business model that allows us to
react to demand changes significant operational
flexibility is retained through maintaining low
bedstock commitments 71 is uncommitted
third party flying arrangements accounting for 28
of all tour operator capacity and the asset leasing
profiles of our shops and aircraft 46 of aircraft
leases and 36 of shop leases will expire in the
next three years this allows us to manage capacity
in response to changes in the trading environment
our tour operators actively manage capacity
through sophisticated capacity and yield
management systems the uk mainstream business
has a marketleading yield system to plan and
manage capacity allowing us to analyse profitability
for thomson and first choice by creating a detailed
picture of profitable capacity by individual flight
this allows us to determine optimum seat capacity
by each uk airport and to ensure that we maintain
the most appropriate aircraft fleet size and type
this has enabled us to leverage the strength of
both these brands by improving efficiency with
fewer aircraft and less risk driving an improvement
in margins our other businesses are also beginning
to implement this system in the activity sector 
the ski business has fully implemented the same
yield management tool driving further improvements
in margin
the cost synergies arising from the integration 
of first choice and thomson and further synergy
benefits in france austria and the uk ski
businesses and accommodation  destinations 
will contribute significantly to our profitability 
we have made excellent progress to date delivering
synergies of £120m in 2009 and expect to deliver
further synergies of £60m in 2010 maintaining 
our target of £200m in 2011 in addition to the
delivery of these cost synergies the businesses are
continually working to leverage their marketleading
positions and scale to maximise their cost
competitiveness and rationalise the cost base
further through the continual improvement of
business processes and systems we are also further
reviewing options to reduce the number of
reservation and back office systems in the
mainstream businesses
strategic overview  our strategy
strategic imperatives continued
16 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
imperative 3 people  operational effectiveness group at a glance strategic overview business performance governance financial statements shareholder information
summary
• acquired 11 niche highgrowth
businesses in specialist sectors
• growth plans are progressing well in 
russia  cis
• consolidation of the canadian market
through a proposed strategic venture 
with sunwing
• underlying operating profit up 11 
to £443m
• increase in return on invested capital 
to 92
we have identified a number of market segments
where we can allocate capital to drive growth these
target market segments primarily within our specialist
sectors are highgrowth and highmargin and present
excellent opportunities for us to create leading
positions in fragmented markets these segments
offer significant potential for further growth and we
are creating marketleading positions by a combination
of the acquisition of complementary businesses and
organic growth in our existing businesses we have
completed 12 acquisitions this year 11 in the
specialist sectors and will continue to make bolton
acquisitions in targeted specialist businesses the
pipeline of potential acquisitions is strong at present
and we envisage the level of investment in the
medium term to be similar to recent years
further organic long term growth will be achieved
through the continued introduction of some of 
our specialist brands in the specialist  emerging
markets and activity sectors into new european
markets utilising our distribution strength including
our paneuropean retail estate of circa 3500
branches for example we are launching the best of
our marine adventure and polar cruising products
into germany followed by russia and ukraine
following the successful launch of le boat within
our german retail operation we will position this
customer offering in the dutch and belgian markets
emerging markets have experienced a strong
increase in demand for leisure travel as the leading
international leisure travel group we are excellently
placed to benefit from this opportunity we have
undertaken careful customer research and market
analysis to understand the markets in which we can
participate to add value our strategy within russia
 cis has been the main area of focus and our
growth plans are progressing well we are confident
that by bringing together the skills and knowledge
of tui travel and sgroup capital management
our joint venture partner we can create a leading
position in the russian  cis leisure travel markets
we have an existing presence in brazil china and
india and continue to build our understanding of
these leisure travel markets to determine our
optimal participation strategy for each market
in the mainstream markets we have identified
opportunities to allocate capital to participate in
market consolidation and strengthen our competitive
position driving the turnaround of underperforming
businesses in the mainstream sector during the year
we have reviewed the strategic alternatives for our
canadian business and announced in september
2009 a strategic venture with sunwing a leading 
tour operator in canada the strategic venture with
sunwing will strengthen our position in this market 
it provides us with a share of the profitability of the
venture and has a number of strategic benefits for 
the group including consolidation of the fragmented
canadian market improved operational efficiencies
and synergies and countercyclical profitability
between summer and winter seasons
we continue to believe that the boeing 787
dreamliner represents a fantastic opportunity to
deliver long term growth for the group not only
will it be able to fly greater distances enabling us to
offer a wider range of nonstop destinations to our
customers than equivalent aircraft today but it will
do so with greater fuel efficiency and additional
comfort we plan to use the customer and operational
benefits to position the long haul offering as a key
differentiator in europe allowing us to develop a
preeminent position in the long haul charter market
tui travel will be the first company to take delivery
of the boeing 787 in europe we are expecting to
receive delivery of the first aircraft in early 2012
we have an assetright business model and typically
only invest in assets such as yachts inland waterway
cruisers and expedition cruise ships that provide us
with greater competitive advantage and enable us
to earn premium margins as a result of our asset
right business model delivery against our strategic
imperatives driving underlying margin enhancement
and delivery of synergy benefits of £200m we
remain confident of delivering our medium term
margin targets despite tough economic conditions
we have made significant progress in realising these
key objectives improving operating margins by 
30 basis points to 32 2008 29 and return 
on invested capital to 92 2008 84
tui travel plc annual report  accounts 2009 17
wwwtuitravelplccom
imperative 4 growth  capital allocation we believe that improving our financial
performance will allow us to invest in the future 
of our business for the benefit of shareholders
colleagues and customers our main strategic
objective is to improve the group’s profitability 
and to enhance returns on investment
t o measure our financial progress we have two
financial kpis i operating margin  and ii return
on invested capital roic 
in the year despite the tough economic conditions
operating margins improved by 30 basis points to
32 primarily driven by the delivery of merger
synergies roic increased from 84 to 92
driven by improved profitability
differentiated content is a central pillar of our
product and content strategy across all our
businesses differentiated product earns superior
margins achieves higher customer satisfaction 
and delivers higher customer retention 
in the year we increased the differentiated product
mix by 4 percentage points including investment in
sensimar a new 5star spa concept in the german
source market and further development of the
sensatori concept in the uk source market after its
successful launch in 2008 we expect to continue to
increase the number of units under these concepts
over the next five years
our portfolio of marketleading brands helps to
increase the direct distribution mix by driving
bookings through our controlled channels increasing
the direct distribution mix is a key driver to improve
customer retention reduce our distribution costs
and enhance customer relationships 
we have increased our controlled distribution mix 
in the year in all source markets with the most
significant increases in the nordic region and
germany the increase in the nordic region was
driven by the online channel which now distributes
over half of all holidays sold in germany the
increase was due to increased sales through our
own retail network and through direct brands
maintaining a substantial mix of operating profits
from our specialist sectors as a proportion of our
group result is a strategic priority the specialist
sectors are a major point of differentiation and a
key source of the group’s future growth these
sectors add significant value to the group as they
enjoy higher margins and growth characteristics
often exhibit counterseasonal profitability and are
virtually impossible to replicate as we have crucial
firstmover advantage 
the proportion of operating profit contribution
from the specialist sectors has remained flat in 
the year 
we are experiencing greater consumer awareness 
of sustainability and believe that creating more
sustainable holidays will help protect our product into
the future and also support product differentiation
brand loyalty and competitive advantage 
our airlines’ carbon efficiency compares favourably
with both scheduled and lowcost airlines carbon
emissions from tui travel’s airlines decreased by
375 in the financial year saving over 220000
tonnes of carbon dioxide however the total number
of revenue passenger kilometres flown decreased in
the same period resulting in a very slight increase
in our fleet average co
2
rpk carbon dioxide
emissions per revenue passenger kilometre
strategic overview
key performance indicators kpis
18 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
financial
product 
 content
distribution 
 brands
specialist 
sectors
responsible
leadership
kpi rationale performance group at a glance strategic overview business performance governance financial statements shareholder information
tui travel plc annual report  accounts 2009 19
wwwtuitravelplccom
in january 2008 we set out a roadmap to 
increase tui t ravel’s operating margins from 20 
to 47
we also set out a target of doubling the group’s
roic from the 54 achieved in 2007 we are
confident that we can achieve the improved
financial performance implied by these targets 
by delivering our margin improvement roadmap
operating margin 
2009 2008
32 29
roic
2009 2008
92 84
we are targeting a differentiated product mix 
of over 50 in our mainstream sector
differentiated product mix as a proportion 
of total mainstream sector holidays
2009 2008
37 33
controlled distribution mix as a proportion 
of total mainstream sector holidays
2009 2008
58 53
the proportion of group operating profit
generated by our specialist sectors
2009 2008
35 35
before central costs
aircraft carbon efficiency measured through 
tui travel airlines’ fleet average co
2
rpk
2009 2008
781g co
2
rpk 779g co
2
rpk
we are targeting a controlled distribution mix of
greater than twothirds in our mainstream sector 
we expect the mix of profits from the specialist
sectors to increase in the medium term due to
their superior underlying growth characteristics
although in the next financial year the synergy
delivery in the mainstream sector may reduce the
proportion of profit from the specialist sectors
the group has committed to reducing its direct
carbon emissions by 6 by 20132014 against 
a baseline of 20072008 in terms of total carbon
emissions as well as relative carbon emissions based
on 20082009 operational structure and plans
t arget key performance indicators managing risk
effective risk management is key to the delivery of
our business objectives and strategic goals we have
established a risk framework to facilitate the early
identification and evaluation of risk to ensure
challenges are prioritised and managed accordingly
the objective of the framework is to reduce the 
risk exposure of all of our businesses in line with
the group’s risk appetite and to achieve excellence
through managing risk effectively throughout 
the group
the risk framework which has been developed and
implemented across the group has been closely
linked to the strategic planning process over 120
active risk workshops have taken place to date
conducted at divisional and functional levels and
facilitated by a dedicated group risk management
team to ensure consistency in the methodology
applied the framework is fully supported by a web
based risk reporting system which is used to collect
analyse and monitor risk status
the risk management approach is periodically
reviewed to ensure the most effective means for
understanding evaluating and managing risk are in
place we are continuously striving to improve our
risk management capabilities and work is underway
to further enhance and embed the framework across
the group during the forthcoming financial year
the process
objectives and strategic goals
the group considers four types of risk when
identifying potential events that could affect the
delivery of business objectives and strategic goals
risks are considered in the context of
• longer term strategic and emerging threats
• medium term challenges associated to business
change programmes
• shorter term risks triggered by the changing
external environment and
• shorter term risks in relation to internal
operations
identify and evaluate
the nature of the risk is fully understood and
evaluated by considering the impact and likelihood
t ools and techniques have been developed to
understand the relative priority of risk at varying
levels throughout the group the output is then
used as a basis for determining the order in which
risks should be managed
review and agree
it is the responsibility of senior management teams
and sector boards across the group to review
challenge and agree the risk profile for their area of
responsibility and start to consider how to allocate
resource effectively to manage risk
decide response method
the most appropriate means of response
terminate reduce accept or passon is identified
where necessary taking into consideration the
outcome of any cost benefit analysis to ensure the
activity giving rise to the risk is managed within
justifiable and tolerable levels and in line with the
overall group appetite
develop and implement actions
existing controls are documented along with any
further action plans and delivery dates to treat 
the risk appropriately processes are established 
to ensure clear action ownership and to monitor
progress to help ensure the risk responses are
carried out effectively
review risk status
the businesses are responsible for reviewing and
updating their risk profiles on a quarterly basis to
ensure the group has clear visibility of what its risks
are and how they are being responded to
reporting and governance
the board is responsible for risk management 
and delegates tasks to the audit committee 
group risk management and group audit services
in addition to the quarterly reviews conducted 
by the businesses group risk management
consolidates and aggregates all risks identified
across the group to create the group risk profile
this is presented to the audit committee on a half
yearly basis for review and is also closely monitored
by the group risk management team to ensure
that progress in relation to management of risk 
is sound and effective
as the responsibility for managing risk clearly
resides within the businesses the audit committee
invite the individual senior management teams to
present and discuss their risk profile on a rotational
basis additionally the group risk management
team reports on progress of the development and
implementation of the framework
group audit services play a key role in ensuring
that the businesses adhere to the risk management
framework they review and test the evaluation of
reported risks ensuring that identified controls are
operating effectively and that actions have been
validated to appropriately mitigate risks reported
strategic overview
principal risks
20 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
macro economic
external operating
decline in the economy and potential impact on consumer
demand and capacity commitments
climate change
strategic and emerging
reducing the group’s contribution to global warming
whilst operating in a carbonintensive industry
health and safety
internal operating
accident or injury being caused to any of our colleagues 
or customers whilst in our care as a result of failure in our
due diligence process or supplier negligence
hedging and cost base increases
external operating
potential negative impact on margin from volatility of
foreign exchange and fuel prices affecting unhedged
balances and other general cost base increases as a result
of the economic conditions
business interruption  technology reliability
internal operating
inability to resume business operations or trading due 
to critical systems failure heavy reliance on key selling
systems or business interruption scenario at any of our
key locations critically affecting our ability to service 
and trade
geopolitical  natural catastrophes  pandemic
external operating
political volatility natural catastrophes and global outbreak
of swine flu h1n1 affecting certain destinations andor
source markets where we operate causing disruption to
programme and customer experience potential safety
exposure and negative impact on destination desirability
liquidity and cash management
internal operating
management of group cash position over diverse portfolio
and potential risk to cost of financing
supply chain  product failure
external operating
failure of key suppliers that we are heavily reliant on
which could cause negative customer experience or loss 
of financial investments
aviation finance contract commitments
external operating
ability to secure adequate funding and manage capital
cost of aircraft effectively
• flexible business model beds and aircraft in order to adjust capacity in response to changes in
demand with only 29 of group bedstock committed and third party flying accounting for 28 
of all tour operator capacity
• majority of aircraft and shops on operating leases 46 of all aircraft leases and 36 of shop
leases due to expire in the next three years
• strong focus on cost control
• competitive supplier scale benefits postmerger
• robust aligned strategy across group
• strong balance sheet and secured lines of finance
• replacing older aircraft with new more fuel efficient models
• significant investment in new technology like the boeing 787
• fuel efficiency measures in engineering flight planning and management maintenance and
ground operations
• carbon management strategy in development to reduce the group’s greenhouse gas emissions
from airlines water transport major premises ground transport and flagship hotel properties
• preparing for regulatory proposals on climate change
• riskbased approach to health and safety due diligence for group products and activities
• destinationbased quality reviews carried out for areas of high risk
• industryleading expertise employed at the centre to set policy and provide guidance
• best practice sharing across group tailored to source market need
• robust airline safety management systems in place across the group
• hedging policies in place across all source markets controlled and monitored by group treasury
• flexible cost base and strong focus on fixed cost reduction and transitioning fixed to 
variable costs
• strong relationships and contracts with key suppliers to control cost increases
• standing agenda item at the monthly gmb mainstream committee meeting
• robust centrally supported technology for significant parts of the business
• investment in disaster recovery plans and reliance testing postmerger
• dedicated project team established to support the development of business continuity and
disaster recovery plans across the group
• flexible supplier agreements allowing for capacity to be switched
• balance of destination mix to minimise concentration
• strong relationships with local tourism bodies and travel industry associations and government
guidance obtained and used
• crisis management policy established and rolled out and operational plans in place to respond 
to incidents
• health and safety risk assessments conducted postincident
• daily cash balances reported and monitored
• strong focus on working capital management at the centre
• centralised cash management system implemented across the group
• daily counterparty reviews and investment control by central team
• strong relationships with banking and financing partners
• key lines of finance do not expire until mid 2012
• renegotiation of shareholder loan repayment schedule
• increased liquidity through convertible bond offering
• spread of financial commitments across key value chain suppliers
• well established relationships with key suppliers
• service levels monitored and managed accordingly
• centralised purchasing functions for key procurement areas
• regular inspections of key service providers to assess health and safety quality and sustainability
• long and well established partnerships with diverse group of institutions providing 
aviation financing
• continued strong operating performance supports status with aviation investment and 
banking community
• reduced order book through cancellation or deferral where possible
• sourcing best market rates for financing and sale and leaseback of current deliveries
some of the principal risks that the group is currently managing are
risk type  nature of risk faced business response
tui travel plc annual report  accounts 2009 21
wwwtuitravelplccom group management board
the strategic direction of the group is set by the
group management board gmb in conjunction
with the board see governance on page 44 
the gmb consists of tour operating and function
experts drawn from across the group this highly
experienced international team manages and
executes tui travel’s daytoday operations and is
responsible for the overall performance of the group
our colleagues
tui travel employs approximately 50000 colleagues
in over 200 travel businesses around the world they
are key to our success and we are proud of their
commitment and professionalism as they continue
to deliver outstanding customer experiences and
results for the group
diversity
as an international business we operate in many
diverse cultures and accept our responsibility to
rule out discrimination on any grounds including
ethnicity gender sexual orientation disability and
age we continue to develop policies on non
discrimination and inclusiveness in line with best
practice and where possible they are incorporated
into training for line managers as a key part of
induction programmes unfair treatment of any
colleague is not tolerated and confidential reporting
mechanisms are available through which colleagues
can confidentially raise matters of this nature which
may concern them
strategy
the aim of our human resources strategy is to
build the most capable engaged teams to deliver
the best results for our business we support 
this through
colleague engagement
engaging colleagues in our goals and successes and
involving them in matters affecting them
leadership capability
developing our leaders through talent management
succession planning and personal development as
they play a key role in creating and leading high
performance teams
organisation effectiveness
supporting the business through organisation
design and resource management to meet the
medium and long term needs of the group
colleague engagement
we share one vision and one set of values across
the group and have developed winning behaviours
to support them we involve our colleagues in
business matters that affect them and respond 
to feedback received through employee surveys
employee forums and as part of the performance
review cycle
the performance review cycle gives every colleague
the opportunity to meet their line manager at least
once annually to discuss their performance and to
make plans for development in the coming year
strategic overview
responsible leadership
22 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
our team
1 peter long
chief executive
2 paul bowtell
chief financial officer
3 dermot blastland
managing director uk  ireland
4 dr volker böttcher
managing director central europe
5 bart brackx
managing director western europe
6 andrew john
group legal director
and company secretary
7 bill logan
group human resources director
8 johan lundgren
managing director northern region
9 richard prosser
managing director
specialist  emerging markets
10 joan vilà
managing director
accommodation  destinations
11 william waggott
commercial director
12 john wimbleton
managing director activity
12 3 4 5 6 group at a glance strategic overview business performance governance financial statements shareholder information
tui spirit – our vision and values
our common vision and values unite us across the
group and we call this our tui spirit our vision is
making travel experiences special and our four
values are
• responsible leadership
• customer obsessed
• value driven and
• playing to win
winning behaviours have been developed to help
embed these values in every day working life in a
number of ways these behaviours allow us to truly
engage in our work and optimise our performance
– as individuals and as a business
bringing our values to life
our businesses have adapted these values in
different ways to suit their requirements and
circumstances in tui nordics they are called blue
spirit and in tui uk  ireland they are part of the
internal brand be special
in the activity and specialist  emerging markets
sectors colleagues nominated individuals and
teams for tui spirit awards in tui deutschland
tui spirit champions have been selected to help
develop ways to further incorporate tui spirit into
every day working life
special experiences collection
in september we produced our first special
experiences collection a webbased magazine to
showcase stories and experiences of colleagues across
the group living the values in their daily working
lives many of the examples highlighted colleagues
who provided exceptional customer service
‘barteline wolfs a belgian colleague working in 
the costa del sol was on her way into work when
she got a call to say that some clients needed her
assistance barteline found herself in the third
traffic jam of the day and unable to reach the hotel
in time she saw no other option than parking the
car taking off her shoes and running the mile to
the hotel there were many amused faces when 
she arrived and the clients were very impressed’
‘a couple booking their wedding in slovenia through
one of our thomson shops had some very specific
requirements for their special day – including black
roses travel advisor kate wareing scoured europe
and eventually tracked down a supplier kate said
‘you just need to go that little bit further if that’s
what they wanted as far as i was concerned that
was what they were going to get’
in businesses new to the group gmb members
and their teams work to embed tui spirit in a
timescale appropriate to each business for example
in russia and ukraine our values have been shared
and there will be a further programme of activity to
embed them in spring 2010
tui travel plc annual report  accounts 2009 23
wwwtuitravelplccom
78 9 10 11 12 living our values – responsible leadership
our people are vital to achieving our sustainable
development goals responses to internal surveys
show us that colleagues are motivated by knowledge
of the group’s commitment to sustainable
development and that our record in this area is
becoming increasingly important to recruitment and
retention 73 of tui travel’s senior leaders agree
that ‘my business acts responsibly on environmental
matters’ and 66 agree that ‘my business acts
responsibly in the local communities in which we
operate’ leadership voice october 2008
living our values – customer obsessed
an example of how this value has been brought to
life is in our uk mainstream business over 10000
colleagues working in overseas destinations retail
customer service and head office roles have
attended a training module called be a dream
maker with a focus on how to deliver a special
experience to external and internal customers
80 of attendees said they had seen a positive
impact on their own performance after participating
in the training be a dream maker has now been
integrated into the induction programme for all 
new colleagues the positive effect on customer
satisfaction was also clear through the 2009
summer season with ratings improving considerably
compared to the previous year
employee surveys – measuring 
engagement
colleague engagement is closely linked with 
our business success we aim to measure the
engagement and satisfaction of our colleagues
regularly conducting employee surveys at least
every two years
working with an international supplier we also
conducted our first leadership voice survey of 
679 senior leaders in tui travel plc published in
october 2008 the survey gathered opinion on a
range of topics including engagement vision 
values leadership effectiveness and business
direction  strategy the results helped us to
understand the progress made in embedding tui
spirit and our strategy in different parts of the
group we were also able to identify opportunities
for improvement
leadership voice results highlights
• 79 response rate from the 679 senior
managers invited to participate
• 91 favourable responses to ‘i believe in the
goals and objectives of tui travel’
• 88 agreed ‘tui travel’s values are clear to me’
and
• 72 stated ‘my business does a good job of
developing management expertise’
engaging and developing leadership 
capability
developing our managers and senior managers 
is key to our success and we continue to invest 
in developing our leaders our future business
performance is dependent on good succession
planning for senior management roles we aim to
develop our own people targeting as many senior
appointments from within the organisation as
possible we have continued the investment in our
leaders this year through a number of programmes
including costa rica and tui horizons
costa rica
this year as part of our leadership development
programme 75 senior managers from across the
group had the opportunity to attend a fourday
offsite development programme in costa rica the
programme was designed by group management
development working in collaboration with itoi
one of our activity businesses each cohort
completed building work and made business
improvements in a small ecotourism business in
the rainforest the ecotourism business formed a
live case study where delegates applied the group’s
managing for value framework to identify
opportunities to improve business processes
participants practised their leadership skills in a
challenging culturally diverse and unfamiliar setting
working with peers and members of the local
community who run the heliconias lodge in costa
rica a positive business outcome was that a number
of crossgroup projects were initiated by participants
who had identified opportunities to work together
while in costa rica the project was completed
successfully in september 2009 and we are now
investigating a number of destinations and new
project ideas to offer a similar development
programme for our senior managers in 2010
strategic overview
responsible leadership continued
24 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
tui horizons
tui horizons is a development programme for
middle managers who have been identified as
management talent with the potential to take 
up senior general management positions across 
the group
tui horizons is run as a virtual business school using
a number of external experts and internal specialists
from across the group covering business topics
including t ourism and the business environment
strategy and finance during 2009 the programme
ran three times with 65 managers participating
in 2010 we plan to extend the scope of tui
horizons in addition to the core modules we 
will offer a number of oneday master classes 
on specific subjects that will provide ongoing
opportunities for learning and networking
recruiting for our long term success
our international graduate management scheme 
is part of our strategy to recruit and develop the
right people to ensure the long term success of 
our business over 18 months trainees take on
assignments in different parts of the group lasting
threefour months and also receive additional
personal training and support during this time 
at the end of the scheme our trainees are offered
permanent positions where possible
t welve trainees from nine countries – belarus
china france germany hungary india the
netherlands sweden and the uk – participated 
in the international management trainee scheme 
in 2009 this included seven trainees who were
recruited into the scheme in 2009 and five trainees
who joined the scheme in 2008
this year three trainees have joined the group 
in permanent roles as sales  retail manager 
in germany staff incentives manager in uk 
ireland mainstream and project manager for
specialist  emerging markets in russia
organisation effectiveness
we support organisation effectiveness through
talent management and recruitment processes
t alent across the group is reviewed regularly at
board level and we are focused on retaining and
developing individuals to drive the business forward
t o meet seasonal demands we move our top
performing frontline colleagues between retail
overseas representation and airline cabin crew 
roles where possible this develops a multiskilled
workforce with yearround experience of delivering
service to our customers
we use the most effective recruitment methods in
the countries in which we operate and encourage
the sharing of skills and knowledge to suit both 
the business and our colleagues as part of our
recruitment approach we actively promote career
opportunities across the group to enhance the mix
of professional and general management skills
reward programmes
we operate competitive reward programmes 
to reinforce and support our overall colleague
engagement strategy in addition variable
compensation in the form of annual and longer
term incentives helps drive the high performance
that our results demonstrate
this year we introduced an aligned incentive
programme for our most senior leaders throughout
the group the programme rewards financial
performance of the business in which the individual
works in 2010 the programme will also take into
account how that performance was achieved by
mapping the individual leader’s actions to our
winning behaviours t o aid retention of talent and
ensure focus on longer term shareholder value
creation at least onequarter of the annual bonus
achieved is deferred into tui travel plc shares for
three years or more
the majority of our colleagues participate in local
benefit programmes including retirement benefit
schemes and generous holiday discounts in the uk
colleagues are able to purchase shares in the group
through our share incentive plan that provides one
free share for every four shares purchased
tui travel plc annual report  accounts 2009 25
wwwtuitravelplccom throughout the year sustainable development has
continued to be an important part of the business
agenda for tui t ravel we aspire to lead in sustainable
development within the leisure travel industry in
the long term we believe this goal will help build
shareholder value for tui travel and contribute to
operating a strong business now and in the future
• tui travel is listed on the ftse4good index 
in recognition of its transparency and for 
meeting strict social environmental and
governance standards
• it is the highest placed travel company at 16 
in the 2008 good companies guide – the
observer’s annual ethical ranking of 
ftse350 companies
• tui travel’s first full sustainable development
report was published in july 2009 with
independent verification of our targets by 
bureau veritas
• for the second consecutive year we have been
included in the carbon disclosure leadership
index which highlights the top 10 of 
ftse350 companies that have displayed 
the most professional approach to climate
change disclosure
tui travel businesses received several sustainable
developmentrelated awards during 20082009 
for details see
wwwtuitravelplccomsustainabledevelopment
sustainable development strategy
during 20082009 we developed a group
sustainable development policy in conjunction with
key colleagues articulating our vision and approach
to sustainable development the group code of
conduct covers a wide range of sustainability
issues including human rights business ethics and
transparency and commits tui travel to upholding
the principles of the un global compact
tui travel’s sustainable development strategy is
based on consideration of the key issues affecting
the company now and in the future it has been
developed in consultation with internal and 
external stakeholders
we encourage all tui travel businesses to develop
their own sustainable development strategy
aligning with group priorities at the end of
20082009 73 of tui travel businesses had 
their own sustainable development strategy
weighted by employee numbers
policy and mitigation for groupwide risks relating 
to sustainability are facilitated by the group risk
management and sustainable development
departments with responsibility for managing such
risks also shared by the businesses themselves 
for further details see the risk section on page 20
strategic overview
sustainable development
26 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
saving fuel with winglets
tuifly nordic was one of the first
airlines in the world to fit winglets to
the boeing 767s in its fleet aircraft
with winglets – wingends that curve
upwards – can reduce fuel burn by up
to 5 depending on flight distance
all seven tui travel airlines have 
fuelsaving winglets fitted to some 
or all of the aircraft in their fleets group at a glance strategic overview business performance governance financial statements shareholder information
managing sustainable development
this year the group has maintained and enhanced
its governance structure for sustainable development
there are now over 40 full timeequivalent
colleagues working on sustainable development
within tui t ravel
johan lundgren managing director of the
mainstream sector northern region is responsible
for reporting on sustainable development to the
tui travel plc board dermot blastland managing
director of tui uk  ireland has responsibility for
reporting on sustainable development to the group
management board
a group steering committee chaired by dermot
blastland sets the strategic direction and long term
objectives for sustainable development the
committee is composed of sector managing
directors and meets at least once a year
during 20082009 tui travel increased the capacity
of its dedicated group sustainable development
department from three to four people the
department’s role is to drive sustainability
performance across the group towards ftse100
best practice and to forge industry leadership in key
sustainability issues it also has a particular remit to
guide tui uk  ireland’s sustainable development
strategy and activities
each sector has a sustainable development
coordinator with a remit to develop and implement
sustainable development strategy within their
sector this year the sector coordinators have
appointed a network of champions to support them
in the delivery of group and sector sustainable
development strategy
tui travel plc annual report  accounts 2009 27
wwwtuitravelplccom
fair trade excursion
tui nederland launched a fair trade
chocolate excursion in the dominican
republic developed in partnership
with the dutch development
organisations cordaid and paseo 
to generate additional income for the
local cacao farmers ten local farmers
and more than 30 local women have
been trained as guides on the tour
our four strategic priorities
for sustainable development are
carbon management
groups of key colleagues for example fuel 
managers meet to identify possible reduc
tions in our carbon emissions from aviation 
water transport major premises ground 
transport and flagship hotel properties
destinations
colleagues meet regularly to tackle key 
sustainability issues in destinations for 
example sustainability auditing of hotels 
and optimise the environmental social 
and economic impact of our holidays
our colleagues
we share best practice in order to promote 
knowledge of sustainable development 
and positive behaviour change within 
the company
our customers
we share best practice among marketing 
colleagues to engage customers in 
sustainability issues and encourage them 
to choose more sustainable holiday options
each strategic priority has a boardlevel sponsor
and is underpinned by our commitment to
integrate sustainable development into the way 
tui t ravel operates carbon management
climate change affects our destinations and
therefore our product and we acknowledge that 
the group’s greenhouse gas emissions contribute to
global warming tui t ravel has a carbon management
strategy in development to reduce this contribution
covering aviation water transport major premises
ground transport and flagship hotel properties
in 20072008 tui travel’s direct carbon footprint
from diesel gas kerosene and petrol was
6564026 tonnes a reduction of 8 since
20062007 this reduction is attributable to aircraft
fleet consolidation following the september 2007
merger as well as fuel conservation measure across
the tui t ravel airlines
we have committed to reducing tui travel’s direct
carbon emissions by 6 by 20132014 against a
baseline of 20072008 in terms of total carbon
emissions as well as relative carbon emissions based
on 20082009 operational structure and plans
tui travel is monitoring and preparing for
regulatory proposals on climate change that could
have a fiscal impact by addressing our carbon
impacts and putting measures in place to reduce
current and future carbon emissions we are in a
good position to respond to carbon legislation
carbon emissions from aviation
we aim to reduce the environmental impact of our
fleet of aircraft by replacing older aircraft with new
more fuelefficient models and by pursuing a fuel
conservation programme to ensure that our airlines
are as fuel efficient as possible in 20082009 tui
travel airlines’ fleet average emissions were 781g 
of carbon dioxide per revenue passenger kilometre
co
2
rpk tui travel airlines’ carbon efficiency
compares very favourably with both global
scheduled airlines and lowcost airlines
tui travel airlines saved over 34000 tonnes of
carbon dioxide in 20082009 through the groupwide
fuel conservation programme the savings were
made by implementing fuel efficiency measures 
in engineering flight planning and management
maintenance and ground operations
destinations
when managed well tourism supports conservation
and preserves natural heritage the tourism value
chain – accommodation catering retail excursions
transfer and airport services – provides employment
and training opportunities and stimulates local
enterprise to the extent that in 2008 tourism
accounted for 30 of the world’s exports of
services unwto world t ourism barometer
our sustainability impact in destinations is largely
indirect particularly through our accommodation
suppliers and we assume a level of responsibility
for encouraging them to improve in this area 77
of tui travel businesses are actively engaging with
suppliers on environmental issues in addition 
tui travel is involved in hundreds of projects
designed to improve the livelihoods of local people
in destinations for further information on how 
we have embedded sustainability into our
accommodation practices see suppliers on 
page 29
weighted by employee numbers
this year we have also developed groupwide
policies on animal welfare in excursion locations and
the protection of children in tourist areas we also
initiated a project to gain a better understanding 
of the socioeconomic impacts of our operations in
developing destinations particularly in relation to
the growing allinclusive holiday market
our colleagues
we seek to make sustainable development central
to the way we run and manage tui travel this is
articulated through one of our tui spirit values
responsible leadership ‘we are committed to
sustainable development and to making a positive
impact on society’ in order to achieve this we work
closely with human resources and marketing teams
to embed sustainability principles into their work
tui travel’s senior management are regular public
advocates for more sustainable tourism in the media
at industry and governmental events and with other
audiences see our colleagues on page 22 for
further details on how senior management view their
businesses sustainable development performance
strategic overview
sustainable development continued
28 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
the climate project
simon o’kelly general manager 
of peregrine and gecko adventures
has been selected as a presenter 
for the climate project
wwwtheclimateprojectorg simon 
was trained by al gore and other
facilitators to give the climate 
change presentation from the film 
‘an inconvenient truth’ and has
committed to sharing it with as 
many colleagues as possible
gold standard carbon
offsetting
tui travel has invested in five
exclusive renewable energy and
energy efficiency projects that are
scheduled to deliver 500000 tonnes 
of carbon offsets by the end of 2012
the projects are all designed to the
gold standard an independent
organisation that verifies the delivery
of robust carbon reduction and
additional community benefits group at a glance strategic overview business performance governance financial statements shareholder information
our customers
we believe that customer demand for more
sustainable holidays will grow our customers 
are becoming increasingly aware of sustainable
development issues and expect businesses –
including their holiday company – to be tackling 
the issues that matter to them
we know from experience that effective
management of environmental and social impacts
not only saves money but provides a better
customer experience – the correlation between our
customers’ holiday satisfaction scores and the best
performing hotels in the sustainability audit
programme is evidence of this
in response to this demand 86 of tui travel
businesses confirm that they are communicating
with customers on sustainable development issues
75 of tui travel businesses currently offer a
carbon offset to customers and in 20082009 we
developed groupwide communications guidance 
on this issue
weighted by employee numbers
charitable giving
we have developed a groupwide charity policy and
guidelines to ensure transparency in our charitable
activities and to enable us to report annually on 
tui travel’s charitable giving during the year the
group made charitable donations of £290799
2008 £236200 the group made no political
contributions during the year 2008 £nil
our suppliers
our principal suppliers are hotel owners and
operators and transport and excursion providers
our uk and destination teams undertake regular
inspections of accommodation transport and
excursion suppliers to assess not just health 
and safety but also quality and sustainability 
we work with our suppliers on a cycle of 
continuous improvement and if suppliers fall 
below our expectations we remove them from 
our programmes
the t ravelife sustainability system wwwtravelifecouk
has been adopted by a number of businesses in the
mainstream sector northern region and western
europe and in the specialist  emerging markets
sector central europe is continuing with its well
recognised tui umwelt champion ’environment
champion’ award for its 100 most environmentally
friendly hotels
tui uk  ireland has introduced a sustainable
development addendum as part of all accommodation
contracts this means that each hotelier must initiate
or continue to develop a sustainability programme
managing their impacts on the environment their
employees and the local community this is an
industry first for uk mainstream tour operations
over the course of the next financial year the
addendum will be embedded into the contracting
processes of the mainstream sector northern 
region and western europe and in the specialist 
 emerging markets sector
tui travel plc annual report  accounts 2009 29
wwwtuitravelplccom
qualitycentred consultation
highquality hotels are preferred by
customers and generate loyalty to 
the tour operator brand since spring
2009 tui deutschland has offered
professional quality consultation to
hotel operators identifying their
potential for improvement demand
for tui quality support is strong and
these services offer genuine added
value the team has enabled many
hotels to achieve substantial quality
improvements within a short
timeframe increasing the customer
appeal of these hotels considerably group revenue for 2009 was slightly lower than the
prior year at £13863m 2008 £13932m capacity
reductions reduced underlying revenue by 14
partially offset by 4 higher selling prices resulting
in an organic revenue decline of 10 foreign
currency translation increased revenue by 9 due
to sterling weakness and revenue from acquisitions
resulted in a 1 increase over the prior year
the group achieved a £45m improvement in
underlying operating profits to £443m in 2009
2008 £398m this improvement has primarily
been achieved by the delivery of integration
synergies and the recovery of scheduled flying
losses in the uk and germany the improvement
was partially offset by the adverse impact on our
french business of weaker demand and socio
political events in the french west indies and
madagascar and weaker demand and excess
market capacity in canada
the main drivers of the yearonyear improvement
in underlying operating profit are
£m
fy08 underlying operating profit 398
incremental synergies 85
scheduled flying 19
impact of fy08 sale and leasebacks 10
france – nouvelles frontièrescorsair trading 26
canada trading 19
other trading 1
swine flu 10
acquisitions 5
fy09 underlying operating profit 443
a reconciliation of underlying profit before tax 
to statutory loss before tax is as follows
2009 2008
year ended 30 september £m £m
underlying profit before tax 366 319
separately disclosed items 
– operating note 3 340 380
separately disclosed items 
– financial expenses note 4 12 4
impairment of goodwill 7 112
amortisation of business 
combination intangibles 56 87
t axation on profits of joint 
ventures and associates 3 3
statutory loss before tax 52 267
separately disclosed items
separately disclosed items within the operating
result for the year were £340m 2008 £380m 
the majority of these items were noncash in
nature relating to accounting impairments and
write offs out of the £340m total £142m were
cash items separately disclosed items in the 
year included
• costs of £143m incurred to achieve the 
synergy benefits
• an impairment charge of £124m in respect 
of write downs of boeing 747 aircraft operated
by corsair
• restructuring expenses of £40m which relate
primarily to the closure of the sunsail clubs in
turkey and ongoing restructuring in nouvelles
frontières and
• costs of £32m relating to the transaction
between tuifly and air berlin
business performance
group performance
30 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
year ended 30 september 2009
underlying results
1
statutory results
£m 2009 2008 change 2009 2008
revenue 13863 13932 flat 13863 13932
operating profitloss 443 398 11 37 184
profitloss before tax 366 319 15 52 267
basic earningsloss per share p 238p 204p 17 10p 244p
1 underlying operating profit and underlying profit before tax are from continuing operations and exclude separately disclosed items amortisation
of business combination intangibles goodwill impairment and taxation of results of the group’s joint ventures and associates underlying profit
before tax also excludes separately disclosed financial expenses underlying earnings per share excludes the same items net of related taxation group at a glance strategic overview business performance governance financial statements shareholder information
in the year the group completed 12 acquisitions
including 11 within highgrowth niche segments of
the leisure travel market in line with its strategy of
making ‘bolton’ acquisitions of businesses with the
ability to generate premium margins and high
earnings growth the 12 businesses were acquired
for a total consideration of £89m for comparison
in the year ended 30 september 2008 we made 
16 acquisitions for a total consideration of £109m
in addition we announced a further three significant
investments in the year we invested £8m in our
joint venture in russia  cis £30m for a 99
stake in air berlin as part of the transaction between
tuifly our airline operations in germany and air
berlin and announced that we will invest c£55m in
a strategic venture with sunwing in canada
strategic venture in canada
we have agreed a strategic venture with sunwing 
a leading tour operator in canada under the terms
of the deal tui travel will contribute its canadian
operations plus c101m and sunwing will
contribute its operations to the strategic venture
tui travel will receive a 49 interest in the strategic
venture with sunwing’s owners receiving 51
the canadian market has for some time been both
challenging and fragmented the profitability of 
our operations in this market has been affected 
by the excess market capacity and in the year to 
30 september 2009 the business made a loss of
£24m 2008 loss of £5m
this venture strengthens our position in the
canadian market and we believe that the
transaction delivers a number of strategic and
financial benefits to the group in particular the
group will earn a share of the profitability of the
strategic venture rather than 100 of the losses
generated by the current operations
this deal is subject to regulatory clearance which
we expect to receive shortly
tuifly – air berlin transaction
as part of the transaction between tuifly our
airline operations in germany and air berlin tui
travel has acquired 99 of air berlin’s shares
russia  cis
as described above our russia  cis joint venture has
completed the acquisition of a 75 stake in certain
assets of two businesses and expects to complete
the acquisition of a further business shortly
sale and leaseback transactions
in the year we successfully completed the sale and
leaseback of all seven aircraft that were acquired in
the period as well as four aircraft that were held for
sale at 30 september 2008 proceeds for the four
aircraft that were owned at the start of the period
were £90m
we do not have any planned aircraft deliveries in
the year ending 30 september 2010
tui travel plc annual report  accounts 2009 31
wwwtuitravelplccom
acquisitions
company description date country
activity sector
sport abroad sports tours october 2008 united kingdom
t eamlink travel student sports tours october 2008 united kingdom
edwin doran student sports tours november 2008 united kingdom
master yachting yacht charters november 2008 germany
off the piste student ski december 2008 united kingdom
adventure t ours australia adventure tours april 2009 australia
williment travel group sports tours may 2009 new zealand
zegrahm expeditions adventure cruising june 2009 usa
eac language centres language school july 2009 united kingdom
specialist  emerging markets sector
travel adventures student travel october 2008 usa
accommodation  destinations sector
aragon t ours cruise handling may 2009 united kingdom
mainstream sector – northern region
island cruises cruise operator november 2008 united kingdom
total consideration £89m taxation
underlying profit before tax excluding joint ventures
and associates for the year was £351m 2008
£304m the effective tax rate on these profits is
280 2008 280 based on the current structure
of the business and existing local taxation rates and
legislation it is expected that the underlying tax rate
will reduce to a level of around 27
statutory loss before tax for the year less the share
of profit in joint ventures and associates was £61m
2008 loss of £279m the tax credit on this loss
was £42m 2008 £nil representing an effective tax
rate of 69 2008 £nil this rate differs from the
underlying effective tax rate due to the tax effect of
separately disclosed items amortisation of business
combination intangibles goodwill impairment
charges and the recognition for the first time in the
current year of deferred tax assets for losses arising
in prior periods in certain territories
the cash tax rate is expected to be lower than the
underlying income statement tax rate as we utilise
our deferred tax assets generated from restructuring
expenditure and tax losses in the coming year we
envisage a cash tax rate of approximately 15 of
underlying profit before tax
earnings per share
underlying basic earnings per share was 238p
2008 204p an improvement of 17 basic loss
per share from continuing operations was 10p
2008 244p
dividends
the board is recommending a final dividend of 77p
per share 2008 69p on 19 may 2009 the board
recommended an interim dividend of 30p per
share 2008 28p making a full year dividend of
107p per share 2008 97p this represents a
payout ratio of 45 of underlying basic earnings
per share the final dividend will be paid on 1 april
2010 to holders of relevant shares on the register 
at 12 march 2010
the group’s policy is to maintain underlying
dividend cover at around two times we intend to
continue to operate a dividend reinvestment plan
as an alternative to receiving a cash dividend
cash and liquidity
the net debt position cash and cash equivalents
less loans overdrafts and finance leases at the
year end was £338m 2008 £136m this consisted
of £790m of cash and £1128m of interestbearing
loans and liabilities
the increase in net debt has arisen primarily due to
• the cash impact of costs incurred to deliver the
synergy benefits
• a working capital outflow driven by capacity
reductions and the later booking curve
• acquisitions made in the year and
• an adverse impact arising on the translation 
of foreign currency denominated debt
on 29 september 2009 we announced a number
of financing measures including
• an issue of £350m of convertible bonds due 
in october 2014
• additional revolving credit facilities of £140m
maturing in june 2012 and
• deferral to april 2011 of €160m of the shareholder
loan beyond the 2011 seasonal peak in net debt
as part of a rescheduling of the repayment
profile of the loan
in accordance with the new repayment schedule
we repaid €100m of our shareholder loan on 
30 september 2009 and the outstanding balance 
is now €919m the new repayment schedule is 
set out below
€m
1 april 2010 250
1 december 2010 509
1
30 april 2011 160
1 adjusted for any further movements in the balance due prior to 
that date
in addition to the above we have a £770m
revolving credit facility which matures in june 2012
given the group’s current facilities and current cash
flow forecasts the board remains satisfied with the
group’s funding and liquidity position fixed charges
cover and the ratio of net debt to ebitda which
we believe to be the most useful measures of cash
generation and gearing were 20x and 05x
respectively at the year end 2008 21x and 02x
respectively fixed charges cover is defined as
ebitda before operating lease rentals charge
divided by net interest plus operating lease rentals
ebitda is defined as earnings before interest tax
depreciation and amortisation and is calculated on
an underlying basis
business performance
group performance continued
32 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
pension deficit
the net accounting pension deficit at the year 
end has increased to £500m 2008 £253m the
increase was driven primarily by a reduction in the
discount rate used to calculate the present value 
of future liabilities from 69 to 55 in the uk
the basis for the reduced discount rate was lower
corporate bond yields
we anticipate cash contributions to fund the
pension deficit will be c£70m per annum in 2010
and will remain at this level in the medium term
accounting policies
there have been no changes in accounting policies
during this financial year the group continues to
monitor the potential impact and timing of changes
to international financial reporting standards which
will be applicable to the group in future years
treasury policies
the board has established a framework to ensure
that the group has adequate policies procedures
and controls to successfully manage the financial
risks that it faces these form part of the company’s
risk management framework see page 20
the key financial risks faced by the company are in
relation to foreign currency interest rate fuel price
and liquidity group treasury has implemented
individual treasury policies to cover specific risks
faced by each business unit the procedures
stipulate the levels of authority applied to dealing
and approve the financial instruments that may be
used to manage these exposures all significant
treasury transactions on behalf of the businesses
are undertaken and executed by group treasury
t ransactions are undertaken only to hedge underlying
exposures financial instruments are not traded
nor are speculative positions taken
tui travel plc annual report  accounts 2009 33
wwwtuitravelplccom proportion of group revenue
£1 17bn £118bn
the mainstream sector reported an underlying
operating profit of £305m in 2009 an
improvement of £28m 2008 £277m this
represents 65 of group underlying operating
profit before central costs 2008 65
mainstream 2009 2008 change 
underlying operating 
profit £m
northern region 206 178 16
central europe 66 62 6
western europe 33 37 11
total 305 277 10
underlying operating
margin 
northern region 49 41 80bps
central europe 14 13 10bps
western europe 12 14 20bps
total 26 23 30bps
northern region
the northern region comprises the distribution
and tour operating businesses in the source
markets of uk and ireland the nordic countries
and canada brands include fritidsresor the nordic
tour operator and retailer first choice and
thomson the leading uk high street brands and
signature vacations the tour operator in canada
the northern region achieved a 16 improvement
in underlying operating profit to £206m in 2009
2008 £178m the improvement was largely driven
by incremental merger synergies of £64m and
reduced scheduled flying losses in the uk offset by
weaker trading in canada and ireland the weaker
winter programme for thailand in the nordics and
the adverse impact of the swine flu outbreak in
mexico on the uk performance
08 £118bn
09 £117bn
underlying operating profit bridge
uk  northern
£m ireland nordics canada region
2008 133 49 5 178
scheduled 
flying losses 9 – – 9
sale and leaseback
transaction 5 – – 5
swine flu 9 – – 9
trading 10 3 19 33
acquisitions 2 – – 2
synergies 64 – – 64
2009 184 46 24 206
northern region 2009 2008 change 
customers ’000
uk  ireland 5687 6978 19
nordic 1177 1313 10
canada 240 279 14
total 7104 8570 17
revenue £m
uk  ireland 3257 3433 5
nordic 797 766 4
canada 168 178 6
total 4222 4377 4
underlying operating 
profitloss £m
uk  ireland 184 133 38
nordic 46 49 6
canada 24 5 na
total 206 178 16
underlying operating 
margin 
uk  ireland 56 39 170bps
nordic 58 64 60bps
canada 143 28 1150bps
total 49 41 80bps
uk  ireland
uk  ireland delivered a £51m improvement in
underlying profits to £184m in 2009 2008 £133m
the uk delivered synergies of £93m in 2009 an
increase of £64m over prior year synergies of £29m
significant achievements during the year included
the full integration of the thomson and first 
choice cabin crews and pilots from 1 may onwards
further consolidation of the core it systems and
infrastructure with summer 2009 running off a
single reservation system and the successful
integration of island cruises with thomson cruises
business performance
segmental performance
34 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
greener holidays ebrochure
in april 2009 first choice published
greener holidays the first brochure 
in the uk market to promote more
sustainable mainstream holidays the
online brochure features only those
hotels that have earned a travelife
award for their commitment to the
environment their employees and 
the local community and provides 
an easy way for customers to make 
a more sustainable choice
wwwfirstchoicecoukgreener
holidays
mainstream sector group at a glance strategic overview business performance governance financial statements shareholder information
during the year the business eliminated a
significant amount of lossmaking scheduled flying
capacity which resulted in the reduction of £9m of
scheduled flying losses from the previous financial
year charter capacity reductions supported a
stronger pricing environment in the lates market
and input cost inflation was recovered through
higher average selling prices
the outbreak of swine flu in mexico in april 2009
resulted in an adverse impact of £9m in the second
half of 2009 due to repatriation and compensation
costs increased cancellations and lower load factors
when the mexico flying programme resumed in may
the irish business increased operating losses by £3m
versus the prior year due to a significant decrease
in demand resulting from the weak economic
environment customer volumes decreased by 
23 in 2009 with a similar decrease in capacity
additionally all operators in the market reduced
prices to secure volumes and margins were eroded
as a result we have carried out a strategic review 
of the irish business which will enable it to operate
more profitably in this challenging market in the
coming year through measures including cost
reductions and further capacity rationalisation
controlled distribution increased by three
percentage points to 78 in 2009 as improved
functionality on both the thomson and first choice
websites drove greater online volumes the recently
launched ‘mythomson’ is a personalised portal that
allows customers to access bookings pay balances
and select seats
the focus on delivering highquality differentiated
product and service continued in 2009 thomson
built on the highly successful 2008 launch of
sensatori in crete with two more of these 5star
concept hotels sensatori mexico opened may
2009 and sensatori t enerife opening may 2010
first choice launched the hugely popular splash
brochure with 13 splash hotels each offering
unlimited free access to an onsite waterpark the
first choice holiday village portfolio also expanded
with an updated unit in lanzarote and further
openings including rhodes are planned for 2010
the cruise programme also saw further expansion
thomson dream joined the fleet to sail from april
2010 opening up new destinations in cuba and
honduras we now have a market leadership position
in the 3 to 4star cruise market in the mediterranean
nordics
the nordics business reported underlying operating
profits of £46m 2008 £49m and an operating
margin of 58 if we were to include profits earned
from destination services which includes transfers
and excursions and which are reported in our ad
sector the operating margin generated by the
nordics business would be c7
the yearonyear decline in profit was primarily 
due to reduced demand for the main long haul
destination of thailand in winter 20082009
following political upheaval in bangkok winter
20082009 volumes to thailand were lower and
margins were further affected due to discounting in
the lates market leading to a £10m loss however
there was a good recovery in this destination during
the summer 2009 season and volumes to thailand
were ahead of last year we are the only tour
operator to offer direct flights on our own airline
from all major nordic airports to the thailand
market which strengthens our position as the
leading long haul operator in the nordic region
the summer 2009 programme performed very well
with strong customer demand particularly in the
lates market load factor improved by six percentage
points over the prior year contributing to record
summer profits for the nordics business summer
2009 capacity was reduced by 12 with the majority
of reductions targeted in the shoulder months
during 2009 the level of differentiated product
offered by the nordics business increased by four
percentage points to 41 this was driven by the
opening of a new ecofriendly blue village in
rhodes and the creation of a new concept blue
unique with 20 small unique hotels in several
charter destinations
controlled distribution increased by six percentage
points to 85 in 2009 driven by growth in online
sales which reached 52 in 2009 2008 46
improvements in web functionality and increased
availability of products online contributed to the
significant growth in online sales during the year
canada
canada reported an underlying operating loss of
£24m in 2009 2008 loss of £5m the canadian
market has for some time been both challenging
and fragmented and significant overcapacity
resulted in deep discounting and margin erosion 
for all market participants in 2009
we have reviewed the strategic alternatives for the
canadian business and on 29 september 2009 we
announced that we have agreed a strategic venture
with sunwing a leading tour operator in canada this
deal strengthens our position in the canadian market
and has a number of strategic and financial benefits
to the group this deal is subject to regulatory
clearance which we expect to receive shortly
tui travel plc annual report  accounts 2009 35
wwwtuitravelplccom
nordics blue village
blue village offers familyoriented
hotels located close to the sea
designed and planned exclusively for
the nordic market the focus is on
families with children with a wide
selection of facilities and childcare
options we currently have 13 hotels
principally in european destinations
such as spain canary islands and
cyprus and also one hotel in thailand central europe
central europe includes the source markets of
germany austria switzerland and poland in
germany and austria tui is the number one brand
with many different tour operator and distribution
activities in germany the largest market there 
is a broad brand portfolio that reaches out to 
all customer segments tui is the favourite brand 
of the german holidaymaker 12fly appeals to
priceconscious customers while airtours is a brand
designed for the luxury segment
central europe reported an underlying operating
profit of £66m in 2009 2008 £62m as outlined 
in the table below the improvement of £4m is
principally due to strong summer 2009 trading in 
the german tour operator up £15m the elimination
of tuifly losses £10m partially offset by weak
trading in switzerland down £4m and poland
down £11m
underlying operating profit bridge
switzer central
£m germany austria land poland europe
2008 45944 62
scheduled 
flying losses 10 – – – 10
impact of sale 
and leasebacks 5 – – – 5
trading 15 2 4 11 2
synergies – 1 – – 1
2009 65 8 – 7 66
central europe 2009 2008 change 
customers ’000
germany 8775 10056 13
switzerland 286 324 12
austria 565 682 17
poland 104 141 27
total 9730 11203 13
revenue £m
germany 4144 4036 3
switzerland 185 196 6
austria 405 385 5
poland 62 85 27
total 4796 4702 2
central europe 2009 2008 change 
underlying operating 
profitloss £m
germany 65 45 44
switzerland – 4na
austria 8 9 11
poland 7 4na
total 66 62 6
underlying operating 
margin 
germany 16 11 50bps
switzerland – 20 200bps
austria 20 24 40bps
poland 113 47 1600bps
total 14 13 100bps
germany
underlying operating profit for 2009 was £65m 
an improvement of £20m over the prior year 2008
£45m strong summer 2009 trading in the tour
operator led to an improvement of £18m in the
2009 result this was driven by a 17 cut in charter
capacity which resulted in fewer holidays left to 
sell than in the prior year particularly in the lates
market as a result higher average selling prices
were achieved which led to improved margins over
last year demand was also stimulated by passing
on hotel rate renegotiations to the customer the
capacity cuts were mainly in the short and medium
haul destinations of balearics greece canaries and
mainland spain partly offset by increased customer
demand for destinations such as turkey cape
verde croatia and the us
tuifly also improved its result by cutting capacity 
in its lossmaking scheduled flying routes capacity
was cut by 16 in summer 2009 which led to a
two percentage point improvement in load factors
for its summer 2009 programme and resulted in 
a £10m improvement in margins over the prior
year during the year we also announced that we
entered into a strategic venture with air berlin
which will further derisk the tuifly business
through an exit of the scheduled flying operation
and will secure optimal capacity for the german
tour operator
business performance
segmental performance continued
36 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
sensimar launch success
a new hotel format called sensimar
has been launched in order to reach
out specifically to the attractive and
growing target market of highincome
couples seeking quality products in 
its first year of operation the concept
was very successful and the first three
hotels in crete rhodes and side in
turkey achieved average occupancy
rates of 75
tui deutschland establishes
new sustainability initiative
early in 2009 tui deutschland
launched the industry sustainability
initiative futouris which focuses on
climate and biodiversity protection
and the promotion of educational
programmes the initiative supports
schools in namibia and nepal and
farmers in kenya following its
establishment by tui deutschland
competitors have now also joined 
the initiative group at a glance strategic overview business performance governance financial statements shareholder information
germany improved its controlled distribution by six
percentage points to 46 in 2009 through increased
sales through our own retail network and direct
brands such as berge  meer and l’tur
the underlying operating margin  in germany
improved by 50bps to 16 2008 11 but this
remains below target margins the pro forma margin
which reflects the benefit of eliminating residual
losses of £20m and associated revenues of £275m
in the scheduled flying operation is 22
switzerland
switzerland reported a breakeven underlying
operating result in 2009 2008 profit of £4m
customer volumes decreased by 12 over the prior
year due to soft consumer demand as well as over
capacity in the market and aggressive pricing by
competitors to protect market share in addition
prices were adversely affected by the unfavourable
exchange rate for the swiss franc against the euro
austria
austria reported underlying operating profits of
£8m 2008 £9m trading performance was
adversely impacted by weaker customer demand 
in the austrian market although margins were
protected by capacity control which led to a decline
in volumes of 17 over the prior year the volume
decreases were largely in the destinations of
greece spain and tunisia
the austrian business delivered synergies of £4m
in 2009 an increase of £1m over the prior year
figure of £3m this has been achieved through 
the integration of the former first choice and tui
businesses including significant savings on it
commission advertising and brochure costs
poland
poland reported an underlying operating loss of
£7m in 2009 2008 profit of £4m this decline was
driven by the significant weakening of the polish
zloty against the euro which increased input costs
and significantly reduced customer demand for
euro destinations volumes decreased by 27 in
2009 over the prior year
western europe
western europe comprises the marketleading tour
operating and distribution businesses in france
belgium and the netherlands as well as the
following airlines corsairfly france jetairfly
belgium arkefly netherlands and jet4youcom
morocco in france it includes the two largest
tour operators nouvelles frontières and marmara
in belgium it comprises jetair which is the largest
holiday brand in belgium and sunjets while in the
netherlands it comprises tui nederland with the
brands holland international and arke the latter
being the only vertically integrated tour operator 
for the dutch source market
western europe reported underlying operating
profits of £33m in 2009 2008 £37m in france
our airline corsairfly was significantly impacted by
the sociopolitical issues in the french west indies
and madagascar in the second quarter this was
offset by a very strong performance from belgium
due to robust summer 2009 trading and reduced
fuel costs
underlying operating profit bridge
western
£m france netherlands belgium europe
2008 5 8 24 37
fwimadagascar 15 – – 15
trading 12 1 21 8
acquisitions 1 1
synergies 4 – – 4
2009 19 7 45 33
western europe 2009 2008 change 
customers ’000
france 2217 2451 10
netherlands 1274 1430 11
belgium 1790 1864 4
total 5281 5745 8
revenue £m
france 1228 1307 6
netherlands 700 686 2
belgium 724 759 5
total 2652 2752 4
tui travel plc annual report  accounts 2009 37
wwwtuitravelplccom
jetairfly and arkefly joint
venture
in 2008 a joint venture called tec4jets
was created between our belgian
airline jetairfly and dutch airline
arkefly for completion of aircraft
maintenance the combined efforts 
of management and colleagues along
with successful development of
synergies across the two airlines
contributed to both significant
improvement in ontime performance
for both airlines and higher customer
satisfaction levels western europe 2009 2008 change 
underlying operating
profitloss £m
france 19 5na
netherlands 7 8 13
belgium 45 24 88
total 33 37 11
underlying operating
margin 
france 15 04 190bps
netherlands 10 12 20bps
belgium 62 32 300bps
total 12 14 20bps
france
underlying operating profit bridge
nouvelles
£m frontières corsair marmara france
2008 22 10 17 5
fwimadagascar – 15 – 15
trading 8 19 1 12
acquisitions 1 – – 1
synergies 2 – 2 4
2009 13 24 18 19
france reported an underlying operating loss of
£19m in 2009 2008 profit of £5m corsairfly our
french long haul scheduled airline was significantly
impacted by a series of sociopolitical events in 
the key destinations of french west indies and
madagascar during the second quarter consumer
sentiment towards these destinations continued to
be weak for the remainder of 2009 and passenger
numbers to these destinations decreased by 15
versus the prior year as a result corsairfly incurred
repatriation costs cancellations and weaker demand
for these destinations which led to a £15m impact
on operating profits
the airline also experienced softer consumer
demand following the economic downturn as a
result of the softer demand the average selling
prices achieved were not sufficient to recover 
input costs
controlled distribution improved by four percentage
points in 2009 to 50 driven by a redesign of our
french websites and a series of marketing actions
to strengthen brand awareness
france delivered synergies of £5m an increase of
£4m over the prior year synergies of £1m these
synergies were primarily generated by distributing
marmara products through the nouvelles frontières
retail network and savings on seat rates for shared
routes in addition marmara launched four new
long haul destinations – mauritius dominican
republic kenya and canada – using nouvelles
frontières’ inhouse flight capacity which enabled
marmara to offer these destinations at attractive
prices for the french customer
we are focused on strategic solutions for all aspects
of the nouvelles frontières and corsairfly
businesses including
• continuing to review the business model and
strategy for the corsairfly business
• addressing our product strategy including
revitalisation of our differentiated product
offering and rationalisation of the product range
to exit from unprofitable destinations and
• expanding distribution capability including an
agreement with carlson wagonlit
netherlands
netherlands reported an underlying operating
profit of £7m in 2009 2008 £8m summer 2009
margins were slightly behind the prior year as
average selling prices were under pressure in the
lates market due to the softer consumer demand
and the later booking profile t otal capacity for 2009
was reduced by 12 compared to the prior year
particularly to the destinations of spain down
15 and turkey down 10 with customer
volumes down 11
belgium
belgium achieved a strong improvement in
underlying operating profits to £45m 2008 £24m
this was driven by careful capacity management
which resulted in higher occupancies and strong
pricing in the summer 2009 lates market combined
with innovative upselling cost efficiencies and a
significant reduction in fuel costs during 2009 the
business successfully launched a new webbased
reservation platform which improved operational
efficiency and web capability
business performance
segmental performance continued
38 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
tui nederland takes
sustainable tourism to 
travel agents
tui nederland was the first dutch
travel organisation to launch a
sustainable tourism policy for its 220
travel agencies during the year the
stores received training and practical
information on sustainable tourism 
a group travel agencies sustainable
development report was also created
and each store received its own
sustainability report in january 2009
tui nederland won the travel industry
award ‘green feather’ for its
sustainability activities group at a glance strategic overview business performance governance financial statements shareholder information
proportion of group revenue
£816m £780m
the activity sector has over 40 activity 
travel businesses that operate in the market
segments of marine adventure ski student
and sport it is market leader in adventure
travel taking more customers to iconic
adventure destinations than any other operator
its sport businesses are leaders in supporterled
cricket and rugby tours in australia and the uk 
the student businesses encompass everything
from the traditional school trip to france to young
adults trekking in the himalayas the moorings and
sunsail are the leading yacht brands in europe and
the us and this sector also includes crysal ski the
world’s largest ski operator
the activity sector delivered underlying operating
profits of £59m in 2009 2008 £50m driven by
acquisition profits of £3m and integration synergies
growth of £7m with underlying trading broadly in
line with the prior year
ski student
£m marine adventure and sport activity
2008 19 14 17 50
acquisitions – 2 1 3
synergies 1 – 6 7
trading 1 3 3 1
2009 19 13 27 59
activity 2009 2008 change 
revenue £m
marine 131 142 8
adventure 240 239 –
ski student and sport 445 399 12
total 816 780 5
underlying operating
profit £m
marine 19 19 –
adventure 13 14 7
ski student and sport 27 17 59
total 59 50 18
underlying operating
margin 
total 72 64 80bps
08 £780m
09 £816m
the marine division reported underlying profits of
£19m in 2009 2008 £19m additional synergies 
of £1m were delivered in 2009 in line with the prior
year through cost savings achieved by merging 
back office operations across the marine businesses
the business was able to mitigate the impact on
profitability of weaker consumer demand by
reducing capacity and implementing cost saving
measures and also benefited from some currency
gains the flagship yacht base in t ortola in the
british virgin islands was officially opened in
february 2009 the marina is home to 400
catamarans and monohulls and provides excellent
recreation and leisure facilities for guests before
and after their charter during 2009 le boat also
successfully launched its products through the tui
deutschland retail network which is now le boat’s
largest distributor in that market
the adventure businesses reported underlying
operating profits of £13m in 2009 2008 £14m
businesses acquired during the year plus the
annualisation of acquisitions made in the prior year
contributed £2m of profit in 2009 the acquisition
of ata in april 2009 enabled the australian group
of businesses to extract synergies from the
integration of ata with its existing operations in
july 2009 we acquired zegrahm which will operate
closely with our quark polar cruise business to
expand distribution and undertake joint marketing
initiatives the north american and scandinavian
adventure businesses however saw reduced
customer demand in 2009 with revenue down 
15 compared to the prior year
the ski student and sport divisions increased
underlying operating profits in 2009 by £10m to
£27m 2008 £17m the divisions delivered strong
trading growth of £3m in 2009 versus prior year
driven by the lions t our in june 2009 and growth in
the student businesses businesses acquired during
the year plus the annualisation of acquisitions made
in the prior year contributed £1m of profit in 2009
with the sports division strengthening its position
through the acquisition of williment the leading
sports business in new zealand and the student
division entering the substantial and rapidly
expanding language school market with the
acquisition of eac the ski division delivered
additional integration synergies of £6m in 2009 
over the prior year through the integration of the
former tui and first choice ski and club businesses
tui travel plc annual report  accounts 2009 39
wwwtuitravelplccom
tui marine awardwinning
catamaran
tui marine unveiled the new sunsail
38foot catamarans sunsail 384 at
the october 2009 annapolis boat
show in the us this model was built
exclusively for tui marine creating a
leading and differentiated position in
the fastest expanding segment of
yacht charter in the world the new
catamaran has already been
nominated as a finalist for two
prestigious competitions to be
announced in 2010
activity sector
quark expeditions opens new
routes
quark expeditions has launched a
greenland programme which gives 
the opportunity to learn more about
this area once on board the ship
customers are given illustrated
presentations on greenland’s wildlife
and geography and can explore its
eastern fjords in zodiacs and kayaks
quark’s expeditions are accessible
worldwide through tui travel’s
existing distribution network including
adventure brands such as peregrine
australia exodus in the uk and from
next year in germany proportion of group revenue
£825m £819m
the specialist  emerging markets sector is
an international portfolio of travel businesses
focusing on specific destinations premium
travel experiences or particular customer
demographic segments often with
differentiated and exclusive product
this sector consists of 40 businesses operating from
nine source markets in north america europe and
most recently emerging markets such as russia and
ukraine specialist travel experiences include around
theworld private jet expeditions student educational
tours and tailormade trips to the far east africa 
or australia brands include tcs  starquest
expeditions the private jet tour operator sovereign
and hayes  jarvis premium travel brands and
turchese and mostravel destination specialists
the specialist  emerging markets sector reported
underlying operating profits of £31m 2008 £26m
this was due to the delivery of incremental
synergies of £3m and acquisition profits of £1m
with trading slightly ahead of the prior year
£m europe us specialist
2008 14 12 26
acquisitions – 1 1
synergies 3 – 3
trading 1 2 1
2009 16 15 31
specialist  emerging markets 2009 2008 change 
customers ’000
europe 530 634 16
us 303 339 11
total 833 973 14
revenue £m
europe 584 609 4
us 241 210 15
total 825 819 1
underlying operating
profit £m
europe 16 14 14
us 15 12 25
total 31 26 19
08 £819m
09 £825m
specialist  emerging markets 2009 2008 change 
underlying operating
margin 
total 38 32 60bps
europe
the europe division reported underlying operating
profits of £16m in 2009 2008 £14m an increase 
of £2m the division delivered incremental synergies
of £3m in 2009 primarily due to the integration of
the former thomson and first choice businesses in
the uk the majority of the uk businesses are now
on one common reservation platform and this has
significantly increased call centre and online conversion
rates for the former thomson businesses this year
underlying trading decreased by £1m in 2009
compared to the prior year primarily reflecting
softer trading in some markets where conditions
were challenging volumes reduced by 44 and 26
in the spanish and irish businesses respectively
due to the significant weakening of the economies in
these markets citalia the italian specialist business
suffered a 15 decrease in volumes due to the
sterling weakening against the euro which led to
customers switching to non euro destinations
hayes  jarvis and sovereign performed well
however with margins ahead of the prior year 
and volume growth of 8 and 14 respectively
us
the us division reported underlying operating
profits of £15m in 2009 2008 £12m an increase
of £3m underlying trading improved by £2m in
2009 over the prior year and acquisitions contributed
an incremental £1m of profits in the year
the luxury private jets segment performed very well
in 2009 as its winter programme was fully sold before
the recession fully impacted the us economy this
was partly offset by softer trading in the escorted
tours businesses as demand decreased for its
specialist premium products due to the weakening
of the us economy
emerging markets
our growth plans in russia  cis are progressing
well during 2009 the tui russia  cis joint
venture completed the acquisition of a 75 stake
in certain assets of vko a tour operator and travel
agency group based in russia and the acquisition of
a 75 stake in certain assets of voyage kiev a tour
operator and travel agency group based in ukraine
we expect the joint venture to complete the
acquisition of 75 of mostravel shortly the result
for the emerging markets division is included within
joint ventures and associates
business performance
segmental performance continued
40 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
driving growth in 
uk  ireland
over the last year the uk  ireland
specialist businesses have reduced
costs and improved efficiencies by
moving 11 brands onto one platform
for reservations finance hr 
ecommerce and it the benefits
include a wider range of products and
flexibility shared inventory back
office efficiencies and shared best
practice the integration of all brands
onto one platform has driven growth
for this division and will continue to
add value to all of the brands as new
developments are rolled out across
the single platform
specialist  emerging markets sector
sustainable development
champions
during 20082009 the specialist 
emerging markets sector appointed
and trained a network of over 100
sustainable development champions
each with specific targets to achieve 
in this area champions have already
delivered practical sustainability
projects including i viaggi del
turchese’s ‘walk to school’ scheme
saving carbon and strengthening ties
with the local community and
employee engagement activities such
as the uk businesses’ sustainability
themed photography competition group at a glance strategic overview business performance governance financial statements shareholder information
proportion of group revenue
£552m £502m
the accommodation  destinations sector
ad sells and provides a range of services 
in destination to tour operators travel 
agents corporate clients and direct to the
consumer worldwide
services include hotel accommodation transfers
excursions roundtrips organising meetings
incentives conferences and events mice cruise
handling as well as integrated website solutions 
for our customers
ad has a portfolio of online and offline
businesses employing brands – including tui
hotelbeds bedsonline hotelopia lateroomscom
asiaroomscom and intercruises – to distribute 
its products ad is structured along key business
lines which reflect the customer base and the
business model of that particular segment –
business to business b2b and business to
customer b2c
the ad sector reported underlying operating
profits of £60m in 2009 2008 £57m the increase
was due to incremental merger synergies of £3m
and contribution from new acquisitions of £1m
partially offset by the adverse impact of the swine
flu in mexico of £1m
accommodation  destinations change 
customers
b2b roomnights 10
b2c roomnights 17
incoming passenger volumes 10
2009 2008 change 
revenue £m 552 502 10
underlying operating
profit £m 60 57 5
underlying operating
margin  109 114 50bps
08 £502m
09 £552m
ad delivered synergies of £5m in 2009 an increase
of £3m over the prior year synergies of £2m these
synergies were delivered through the integration 
of the former tui and first choice destinations
businesses primarily in dominican republic mexico
and spain the integration process continues to be
ongoing in this sector with further integration to
take place in spain portugal turkey and greece
during 2008 and 2009 ad acquired three cruise
handling businesses and an online bedbank
business and these contributed £1m in additional
profits in 2009 versus the prior year
the business was impacted by the swine flu
outbreak in mexico in 2009 as customer presence
in the mexican resorts was significantly reduced
leading to lost transfer and excursion revenue 
this resulted in lost contribution of £1m in 2009
underlying trading was broadly in line with the prior
year the destinations businesses were adversely
impacted by the capacity reductions implemented
by the tour operators in its core markets such as
spain and greece in 2009 customer volumes were
down 10 in 2009 versus the prior year additionally
excursion revenues were lower in the agencies
based in euro destinations due to the significant
weakening of sterling which reduced inresort
spending by uk visitors
the online businesses performed well due to the
diversity of the b2b and b2c portfolio weaker
performance in the more mature destinations of
spain and portugal due to the economic environment
and competitive pressure was compensated by
growth in demand in emerging markets such as
asia and the americas lateroomscom also
performed well in 2009 with volumes up 47 
over the prior year due to its effective marketing
campaign and a strong increase in content
following the successful launch of lateroomses 
in 2008 lateroomsit was successfully launched
into the italian source market in 2009
tui travel plc annual report  accounts 2009 41
wwwtuitravelplccom
asiaroomscom moves to
lateroomscom model
lateroomscom and asiaroomscom
are our two marketleading brands 
in the accommodationonly market
we have already achieved growth
through investing in brands and
content shared infrastructure and
moving asiaroomscom to a commission
model for hoteliers in 2010 we intend
to build on this growth further by
expanding the geographic reach of
both brands and entering into new
markets in europe and australia
accommodation  destinations sector
ultramar transport reduces
coach fleet emissions
ultramar transport part of tui
españa provides ground transport
services to tui travel customers in
the destinations we serve ultramar
transport has been working hard to
progressively reduce the emission
profile of its fleet coaches 
purchased in the last three years
comply with euro4 and euro5
european union vehicle emission
standards the most stringent in force
representing the very latest engine
and fuelsaving technology summer 2009
trading for the summer 2009 season finished 
in line with our expectations despite the later
booking trend we achieved required load factors
and average selling prices demonstrating the
flexibility of our business model and the strength 
of demand for the main summer holiday this was 
a pleasing performance against the backdrop of
exceptional fuel and currency driven cost inflation
as well as the challenging economic environment
winter 20092010
booking volumes have improved since our previous
trading statement on 29 september 2009 across 
all source markets recent booking volumes are
significantly ahead of the cumulative booking
position and ahead of capacity reductions this
trading pattern is similar to that experienced in the
last two seasons where booking volumes improved
throughout the season reflecting a later booking
trend our focus is on ensuring that we achieve
required prices and load factors and as such 
we entered the season with reduced capacity in
anticipation of weaker demand and have leveraged
the flexibility in our model to further reduce supply
in germany which is now down 9 we retain
flexibility to further adjust capacity to reflect
changes in demand although on the evidence of
recent trading we do not expect to alter capacity
significantly in either direction in the remainder of
the season
yearonyear customer booking variation 
last last last last
4 weeks 6 weeks 8 weeks 10 weeks cumulative
uk 4 6 8 9 16
nordics 14 10 12 9 15
germany 7 3 4 5 15
france 10 18 16 10 9
belgium 13 9 9 6 1
netherlands 6 1 2 5 12
in the uk booking volumes have improved in recent
weeks reflecting similar trends to those seen in the
winter 20082009 and summer 2009 seasons in
the last four weeks booking volumes were down 4
compared to the cumulative position which is down
16 capacity reductions mean that we now have
13 fewer holidays left to sell in the uk including
mix benefits average selling prices remain up 10
with margins flat yearonyear
in the nordics booking volumes have been ahead
of prior year in recent weeks and the cumulative
booking position has improved significantly from 
24 at our last trading update to 15 the
improvement has been seen across all source
markets in the region with particular strength in
sweden and finland which are our two largest
markets in the nordics although we currently have
more product left to sell than last year our rate of
sale leaves us confident that we will achieve
required load factors
in germany we have leveraged the flexibility in our
model to reduce capacity by 9 to ensure that we
achieve required load factors and average selling
prices we have reduced our prices to pass lower
flying costs driven by lower fuel prices and
accommodation savings through to our customers
which should help to deliver our required volumes
without harming our margins
in western europe like our other source markets
cumulative booking volumes are down versus the
prior year but the trend has improved in recent
weeks and volumes were ahead in belgium and
france belgium is trading particularly well
continuing its strong performance in the summer
2009 lates market and has taken more bookings
than at the same time last year
business performance
current trading
42 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
current trading
1
winter 20092010
risk only
total t otal total
y earonyear variation  asp
2
sales
2
customers
2
capacity
3
left to sell
3
mainstream
northern region
short haul 6 20 25
medium haul 7 11 18
long haul 9 14 21
uk 10 8 16 15 13
nordic 3 13 15 11 4
northern region – total 6 13 18
central europe
germany flat 15 15 9 4
austria 2 27 26
switzerland 6 11 5
poland 7 24 18
central europe – total flat 15 15
western europe
france 11 19 9
belgium 4 3 1
netherlands 3 10 12
western europe – total 8 14 7
specialist 13 23 11
activity na 19 na
accommodation  destinations
4
8 20 30
1 these statistics are up to 22 november 2009
2 these statistics relate to all customers whether risk or nonrisk
3 these statistics include all risk capacity programmes
4 these statistics refer to b2b online businesses only and sales refer to total transaction value ttv group at a glance strategic overview business performance governance financial statements shareholder information
the specialist and activity sectors have also
experienced a later booking trend and have seen
significant improvements in demand in recent
weeks in the specialist  emerging markets sector
bookings in the last four weeks are flat on the prior
year whereas cumulative booking volumes are
down 11 the improvement has been seen across
all divisions within the sector with a particularly
marked upturn in the us and russian source
markets in the activity sector sales in the last four
weeks were up 15 versus the prior year with all
divisions showing positive yearonyear trends
in the ad sector greater availability of bedstock
and price reductions by accommodation suppliers
has led to a significant growth in volumes 30 
in our online b2b division as a wholesaler of
accommodation our margins per transaction have
remained flat despite the fall in average transaction
values and the strong volume growth means that
total margins are ahead of the prior year for the
season so far we are seeing similar trends in our
online b2c division with strong growth in our
laterooms business and we have successfully
transitioned our asiarooms brand from a merchant
to a commissionable model driving higher conversion
rates and improved margins
summer 2010
we remain pleased with trading in the uk for the
summer 2010 programme with bookings down 3
we are currently planning for flat capacity for the
season the load factor is flat versus the prior year
at 20 and the average selling price of packages is
now up 7 although this partly reflects the shift 
in destination mix away from short haul and the
product mix shift towards differentiated product
initial trading in the nordics market for summer
2010 has also been encouraging with load factors
flat at 15 and average selling prices up 3
fuelforeign exchange
we have hedged a significant proportion of our fuel
and foreign exchange exposure for 2010 in line with
our hedging policy
winter summer
20092010 2010
euro 75 74
usd 93 83
jet fuel 86 78
as at 20 november 2009
higher fuel prices resulted in 125m of extra costs
in summer 2009 versus summer 2008 based on
achieved hedged rates and current forward rates
the effective fuel rate for summer 2010 is currently
20 lower in local currency terms for most of our
continental european businesses this coupled with
lower accommodation cost rates allows them to
reduce prices significantly whilst maintaining
margins in the uk source market however the
strength of the euro 10 yearonyear offsets
the fuel rate savings
integration
the merger integration continues to progress well
and we are on track to deliver our £200m synergy
target we have delivered £120m of benefit to date
and expect to deliver a further £60m in 2010
synergy phasing
£m fy08 fy09 fy10 fy11
pl benefit 35 120 180 200
incremental pl benefit 35 85 60 20
outlook
in the current economic climate we have taken a
cautious approach to capacity planning to ensure
that supply is in line with demand and we are
pleased with our current booking position
for winter 20092010 we have seen stronger
bookings over the course of recent weeks which
reflects a similar pattern to our experience in
winter 20082009 and this gives us confidence 
that we will achieve required load factors
consumer demand for the main summer holiday
remains strong as evidenced by our performance 
in the summer 2009 season we are currently
planning for capacity to be approximately flat in
most source markets for the summer 2010 season
although we retain flexibility to adjust supply as
demand develops in addition our businesses are
benefiting from significantly lower cost pressures
than summer 2009 which means that unlike last
year we do not have to pass on substantial price
increases to our customers in many of our nonuk
source markets lower input costs driven by lower
fuel rates mean that we can reduce prices without
harming margins we expect this to further
stimulate demand
all of the above leaves us well placed to meet the
board’s expectations for the year ending 
30 september 2010
tui travel plc annual report  accounts 2009 43
wwwtuitravelplccom governance
board of directors
44 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
123
456
789
10 11 12
13 14 15
16 17 group at a glance strategic overview business performance governance financial statements shareholder information
1 dr michael frenzel
nonexecutive chairman age 62
dr michael frenzel joined the board of tui travel plc
on 28 june 2007 as nonexecutive chairman michael
studied law at ruhr university in bochum and completed
his doctorate whilst working at the university as a
scientific assistant he joined westdeutsche landesbank
westlb düsseldorf in 1981 where he was promoted
to various managerial positions and became manager
of the industrial holdings department in 1983 and
overall manager of westlb’s equity holdings division 
in 1985 – including holdings in banking leasing and real
estate michael has held the position of chief executive
and chairman of the executive board of tui ag
formerly preussag ag since january 1994 overseeing
its extensive acquisition programme in the late 1990s
which resulted in the acquisitions of tui ag’s stake in
hapaglloyd and of leading tourism businesses such 
as thomson travel and nouvelles frontières michael 
is also currently a member of the supervisory board 
of a number of companies including norddeutsche
landesbank axa konzern ag and volkswagen ag 
2 sir michael hodgkinson
nonexecutive deputy chairman and senior
independent director age 65
sir michael hodgkinson joined the board of first
choice holidays plc as a nonexecutive director in
january 2004 and became chairman in march 2004 
he joined the board of tui travel plc on 28 june 2007
as nonexecutive deputy chairman and is the senior
independent director following an early career in the
automotive industry he was appointed chief executive
of grand metropolitan’s european food division in
1986 and in 1992 he joined baa plc becoming chief
executive in 1999 a post from which he retired in june
2003 sir michael was senior nonexecutive director at
royal mail and chairman of post office limited until
september 2007 and is currently a nonexecutive
director of transport for london limited dublin airport
and crossrail limited he was also a director of bank 
of ireland plc from may 2004 until july 2006 
3 peter long
chief executive age 57
peter long joined the board of tui travel plc on 
28 june 2007 as chief executive in november 1996 he
was appointed group managing director of first choice
holidays plc and became chief executive in september
1999 prior to joining first choice he was chief executive
of sunworld holidays having previously been finance
director then chief executive of the tour operating
division of the international leisure group from
february 2001 to june 2005 peter was a nonexecutive
director of rac plc and from april 2006 to july 2009
he was a nonexecutive director of debenhams plc
peter was appointed as a nonexecutive director of
rentokil initial plc in 2005 and is currently the senior
independent nonexecutive director 
4 paul bowtell
chief financial officer age 41
paul bowtell joined the board of tui travel plc on 
28 june 2007 as chief financial officer he was appointed
to the board of first choice holidays plc in september
2004 as group finance director and was previously the
finance director of british gas a subsidiary of centrica
plc where he had been since january 2002 prior to
that he was with w h smith plc where he held a
number of corporate centre roles before becoming the
finance director of the uk retail business he is an
associate of the institute of chartered accountants 
in england and wales in november 2007 paul was
appointed as a nonexecutive director of sthree plc
5 william waggott
commercial director age 46
william waggott joined the board of tui travel plc 
on 28 june 2007 as commercial director he spent the
early part of his career with coopers  lybrand and
courthaulds t extiles plc where he performed various
senior group finance and divisional finance director
roles william joined airtours plc in 1992 as uk leisure
group finance director prior to joining thomson travel
group in 2001 he then went on to become chief
financial officer of tui t ourism 
6 dr volker böttcher
managing director central europe age 50
volker böttcher joined the board of tui travel plc on
19 june 2007 and is responsible for central europe 
in the mainstream sector after an early career in law
volker joined t ouristik union international in 1987 as 
a legal advisor having occupied various management
positions he became head of tui’s special programmes
division in 1996 which included responsibility for 
long haul destinations city tours and the eastern
mediterranean in 2003 volker was appointed chairman
for central europe for tui ag being responsible for all
tourism activities in the source markets of germany
austria switzerland and poland he was appointed to
the board of tui deutschland gmbh in april 2000
following the restructuring of tui’s business model in
germany he was appointed ceo of tui deutschland
gmbh in july 2001 
7 johan lundgren
managing director northern region age 43
johan lundgren was appointed to the board of tui
travel plc on 21 december 2007 he is responsible 
for the northern region which includes all mainstream
tourism sales in the uk and ireland canada sweden
norway denmark and finland johan has worked in 
the nordic tourism industry for almost 20 years 14 of
which have been as a managing director between 1999
and 2001 he was president of sunquest vacations in
canada johan went on to become chief executive of
tui nordic and also took responsibility for tourism
sales in the source markets of italy and russia 
8 rainer feuerhake
nonexecutive director age 65
rainer feuerhake joined the preussag group now tui
ag in 1968 and by 1980 was responsible for group
accounting rainer was appointed as chief financial
officer of preussag ag in november 1988 and
subsequently tui ag following a resolution to rename
preussag ag on 1 july 2002 in this position rainer 
was responsible for the departments of accounting 
reporting finance investor relations t ax affairs
mergers  acquisitions destination management and
the shared service centre he joined the board of tui
travel plc on 28 june 2007
9 tony campbell
nonexecutive director age 60
t ony campbell became a nonexecutive director of
first choice holidays plc in april 1997 and joined the
board of tui travel plc on 28 june 2007 as a non
executive director t ony was deputy chief executive of
asda stores limited until march 2001 he is currently
the chairman of hobbs holding no 1 limited 
t m lewin group limited the white company uk
limited and ultralase group limited
10 clare chapman
nonexecutive director age 49
clare chapman became a nonexecutive director of
first choice holidays plc in march 2003 and joined the
board of tui travel plc on 28 june 2007 clare is the
director general of workforce for nhs and social care
department of health prior to this she was group
personnel director at t esco in addition clare serves on
the audit committee of jobcentre plus is an advisory
board member for the judge institute business school
for the university of cambridge and a fellow of the
institute of personnel
11 bill dalton
nonexecutive director age 65
bill dalton became a nonexecutive director of first
choice holidays plc in october 2004 and joined the
board of tui travel plc on 19 march 2007 he was
previously an executive director of hsbc holdings plc
chief executive of hsbc bank plc and global head 
of personal financial services for the hsbc group
during his banking career he has amassed a great deal
of international expertise and is also a nonexecutive
director of a number of uk and north american
companies including associated electric  gas
insurance services aegis aegis managing agency
limited uk hsbc north america holding inc
t alisman energy inc and us cold storage inc 
12 jeremy hicks
nonexecutive director age 56
jeremy hicks became a nonexecutive director of 
first choice holidays plc in march 2005 and joined 
the board of tui travel plc on 28 june 2007 he is 
a chartered accountant with a number of business
interests particularly in the field of marketing services
he has extensive experience in the world of finance 
as an investment banker and most recently as chief
financial officer of aegis group plc a leading ukbased
multinational marketing services group from which 
he resigned in april 2007
13 giles thorley
nonexecutive director age 42
giles thorley became a nonexecutive director of first
choice holidays plc in february 2006 and joined the
board of tui t ravel plc on 19 march 2007 he is currently
the chief executive officer of punch t averns plc after
qualifying as a barrister he had an early career at
nomura international plc and has been in his current
post of chief executive of punch t averns plc since 2001
at punch he successfully led the ipo and punch’s
subsequent acquisition of pubmaster and spirit group to
its current position as the largest pub company in the uk 
14 harold sher
nonexecutive director age 62
harold sher joined the board of tui travel plc as a
nonexecutive director on 29 october 2007 he studied
commerce at university and started his career as a
chartered accountant harold moved to industry early
in his career holding a range of executive positions before
being appointed chief executive of amalgamated metal
corporation plc in 1992 a position he still holds he
has served as president of a major north american
steel services group and together with his role at
amalgamated metal corporation this has provided 
him with broad international commercial experience
15 dr albert schunk
nonexecutive director aged 68
dr albert schunk joined the board of tui travel plc as 
a nonexecutive director on 29 october 2007 albert
studied economics at university and carried out a
research project for the german government in latin
america after joining igmetall he has served on the
supervisory board of volkswagen and other german
companies since 1976 in 1994 he became a member
of the european economic and social council in brussels
and has recently been advising the riu group in spain
16 dr erhard schipporeit
nonexecutive director age 60
dr erhard schipporeit joined the board of tui travel
plc as a nonexecutive director on 29 october 2007
he started his career in 1979 in the bosch group and
in 1981 he joined varta agvarta battery ag at 
that time a leading european battery company where
he became cfo in 1990 and chief executive and
chairman of the executive board in 1993 after the
successful restructuring of varta the next move in his
career brought him to the munichbased conglomerate
company viag ag as cfo viag merged in 2000 with
veba ag to form the new eon ag one of the world’s
leading utility companies erhard was cfo and
executive board member of eon from 2000 until his
resignation in november 2006 in 2007 he was
appointed senior advisor for bnp paribas sa and is
also currently a nonexecutive director of a number 
of companies including sap ag deutsche boerse ag
t alanx ag and hanover rueckversicherung ag
17 horst baier 
nonexecutive director age 53
horst baier joined the board of tui travel plc as 
a nonexecutive director on 13 october 2009 he
commenced his professional career in the treasury
department of continental ag the german tyre
manufacturer between 1994 and 1996 horst was
responsible for group financing for the fürthbased
schickedanz group in 1996 he took over responsibility
for the treasury accounting and t ax department at 
tui ag since 2001 horst has been responsible for
accounting  reporting for tui ag and in november
2007 was appointed to the executive board of tui ag
with responsibility for the controlling function
tui travel plc annual report  accounts 2009 45
wwwtuitravelplccom the directors submit their report to the members of tui travel plc
the company for the year ended 30 september 2009
principal activity
the principal activity of the tui travel plc group of companies the
group is that of an international leisure travel business it provides 
a broad and diverse range of leisure travel experiences to more than
30 million customers in 27 different source markets for further
information see tui travel overview on page 2
annual general meeting
the annual general meeting agm will be held on tuesday 
9 february 2010 at 1030am at the offices of deutsche bank
winchester house 1 great winchester street london ec2n 2db 
an explanation of the business to be transacted at the agm has 
been circulated to shareholders and can be found on the website
wwwtuitravelplccom
business performance
the business performance for the year ended 30 september 2009
prepared in accordance with the companies act 2006 is set out on
pages 30 to 43 and forms part of the directors’ report
results and dividends
the group loss before taxation for the year ended 30 september 2009
was £52m 2008 £267m the directors recommend a final dividend
of 77p per ordinary share 2008 69p payable on 1 april 2010 to
holders on the register at the close of business on 12 march 2010
when taken with the interim dividend of 30p per ordinary share paid
on 1 october 2009 2008 28p this gives a total dividend of 107p
2008 97p relating to the year ended 30 september 2009
corporate governance report
the corporate governance report for the year ended 30 september
2009 prepared in accordance with rule 72 of the fsa’s disclosure and
transparency rules is set out on pages 49 to 52 and forms part of the
directors’ report
policy and practice on payment of suppliers
the operating units within the group are responsible for agreeing the
terms and conditions under which business transactions with their
suppliers are conducted due to the nature of the group’s operations
and in common with the industry as a whole payments are often
made in advance of the provision of goods and services the group
does not follow any code or statement on payment practice but it is
group policy that payments to suppliers whether in advance or after
the provision of the goods or services are made on the basis of the
terms that have been agreed with them
the company had no trade creditors at 30 september 2009 2008 £nil
and consequently creditor days have not been presented where the
company is the recipient of goods or services payment of suppliers is
conducted by one of the group companies in accordance with the
policy set out above
directors’ and officers’ insurance
the company has purchased and maintained throughout the year
directors’ and officers’ liability insurance and the level of cover is
regularly reviewed
significant agreements – change of control
the companies act 2006 requires us to disclose any significant
agreements that take effect alter or terminate on a change of control
of the company
relationship agreement with tui ag
the relationship agreement between tui ag and tui travel dated 
29 june 2007 includes the principle that tui travel will operate
independently of tui ag and records the understanding between tui
ag and tui travel regarding the relationship between them and the
governance of tui travel the relationship agreement will remain in
force until either the shares in tui travel are no longer admitted to
trading on the london stock exchange or tui ag has less than 10
of the rights to vote at general meetings in addition in the event that
another party acquires control of tui ag during the term of the
relationship agreement tui ag will lose certain rights under the
relationship agreement including its rights in respect of the
composition of the board
the relationship agreement contains restrictions on the acquisition 
by tui ag of additional shares in tui travel which result in the
increase of its shareholding to more than 55 of the voting rights
save where tui ag makes a general offer to acquire all tui travel
shares in issue tui ag has antidilution rights in respect of further
issues of shares in tui travel other than on a preemptive basis 
tui travel has also agreed that certain matters will require the prior
approval of 80 of the directors present at the meeting of the board
at which such matter is considered including material changes to the
business of any group company acquisitions and disposals of a value
which exceeds £10m the entry into variation or redemption prior to
their due date of any borrowing facilities and the approval of the
annual budget
£770m bank revolving credit facility agreement
an agreement dated 29 june 2007 between a number of relationship
banks and the company relating to a £770m bank revolving credit
facility currently provided to the company contains terms which 
give the lending banks the right to cancel all commitments to the
company and to declare all outstanding credits and accrued interest
immediately due and payable if a change of control occurs for the
purpose of this agreement a change of control occurs if
i any person or group of persons acting in concert gains control of
the company or
ii tui ag and any persons acting in concert with it acquires or acquire
75 or more of the voting shares in the company
£140m bank revolving credit facility agreement
an agreement dated 29 september 2009 between a number of
relationship banks and the company relating to a £140m bank
revolving credit facility currently provided to the company contains
terms which give the lending banks the right to cancel all commitments
to the company and to declare all outstanding credits and accrued
interest immediately due and payable if a change of control occurs 
for the purpose of this agreement a change of control occurs if
i any person or group of persons acting in concert gains control of
the company or
ii tui ag and any persons acting in concert with it acquires or acquire
75 or more of the voting shares in the company
governance
directors’ report
46 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
£40m bonding and letter of credit facility agreement
an agreement dated 29 september 2009 between a relationship bank
and the company relating to a £40m bonding and letter of credit
facility currently provided to the company contains terms which give
the lending bank the right to cancel all commitments to the company
and to declare all outstanding bonds or letters of credit together with
accrued issuance fees immediately due and payable if a change of
control occurs for the purpose of this agreement a change of control
occurs if
i any person or group of persons acting in concert gains control of
the company or
ii tui ag and any persons acting in concert with it acquires or acquire
75 or more of the voting shares in the company
£350m 60 convertible bonds
subsequent to the year end on 30 september 2009 the company
issued £350m of 60 convertible bonds the settlement took place
on 5 october 2009 the convertible bonds contain terms which give
the bondholders the right to redeem the bonds at their principal
amount together with accrued and unpaid interest up to the date of
redemption if a change of control occurs as more fully described in
the terms and conditions for the purpose of the convertible bonds 
a change of control occurs if
i following a takeover offer to acquire all or a majority of the shares 
in the company the offeror andor its associates have or will have
more than 50 of the voting rights in the company or
ii the free float of the company is less than 30 of the issued
ordinary shares for at least five consecutive dealing days where the
free float is a all outstanding ordinary shares of the company less
those held by or on behalf of tui ag its associates and any persons
acting in concert with it and b the ordinary shares underlying the
outstanding secured exchangeable bonds due 2013 issued by nero
finance limited on 16 january 2008
no other agreements which take effect alter or terminate upon 
a change of control of the company following a takeover bid are
considered to be significant in terms of their potential impact on the
business of the group as a whole
going concern
after making appropriate enquiries the directors have reasonable
expectation that the company and group have adequate resources 
to continue operations for the foreseeable future for this reason 
they continue to adopt the going concern basis in preparing the
financial statements
a further summary of funding and liquidity is included in note 1 to the
consolidated financial statements
contractual arrangements
the group has contractual arrangements with numerous third parties
in support of its business activities see suppliers on page 29 the
disclosure in this report of information about any of those third
parties is not considered necessary for an understanding of the
development performance or position of the group’s businesses
auditors
the auditors kpmg audit plc are willing to continue in office in
accordance with section 489 of the companies act 2006 a resolution
for the reappointment of kpmg audit plc as auditors of the company
is to be proposed at the forthcoming agm
statement of the directors as to disclosure of
information to auditors
the directors confirm that so far as they are each aware there is 
no relevant audit information of which the company’s auditors are
unaware and each director has taken all the steps that he or she
ought to have taken as a director to make himself or herself aware 
of any relevant audit information and to establish that the company’s
auditors are aware of that information
other information
other information relevant to the directors’ report can be found in the
following sections of the annual report
information location in annual report
our colleagues responsible leadership 22
social responsibility responsible leadership 22
sustainable development responsible leadership 26
charitable and political donations responsible leadership 29
suppliers responsible leadership 29
future developments business performance 43
board and committee membership corporate governance report 
49 50
financial risk management corporate governance report 51
and strategic overview 20
post balance sheet events after
30 september 2009 financial statements – note 34
share capital – authorised and issued financial statements – note 23
substantial shareholdings shareholder profiles 128
the directors’ report was approved by a duly authorised committee
of the board of directors on 30 november 2009 and signed on its
behalf by andrew john the company secretary
by order of the board
andrew john
company secretary
30 november 2009
company number 6072876
tui travel plc annual report  accounts 2009 47
wwwtuitravelplccom the directors are responsible for preparing the annual report and the
tui travel plc group of companies the group and parent company
financial statements in accordance with applicable law and regulations
company law requires the directors to prepare group and parent
company financial statements for each financial year under that law
they are required to prepare the group financial statements in
accordance with international financial reporting standards ifrs 
as adopted by the eu and applicable law and have elected to prepare
the parent company financial statements in accordance with uk
accounting standards and applicable law uk generally accepted
accounting practice
under company law the directors must not approve the financial
statements unless they are satisfied that they give a true and fair view
of the state of affairs of the group and parent company and of their
profit or loss for that period in preparing each of the group and
parent company financial statements the directors are required to
• select suitable accounting policies and then apply them
consistently
• make judgements and estimates that are reasonable and prudent
• for the group financial statements state whether they have been
prepared in accordance with ifrs as adopted by the eu
• for the parent company financial statements state whether
applicable uk accounting standards have been followed subject 
to any material departures disclosed and explained in the parent
company financial statements and
• prepare the financial statements on the going concern basis unless
it is inappropriate to presume that the group and the parent
company will continue in business
the directors are responsible for keeping adequate accounting 
records that are sufficient to show and explain the parent company’s
transactions and disclose with reasonable accuracy at any time the
financial position of the parent company and enable them to ensure
that its financial statements comply with the companies act 2006
they have general responsibility for taking such steps as are reasonably
open to them to safeguard the assets of the group and to prevent
and detect fraud and other irregularities
under applicable law and regulations the directors are also responsible
for preparing a directors’ report directors’ remuneration report 
and corporate governance report that complies with that law and
those regulations
the directors are responsible for the maintenance and integrity of 
the corporate and financial information included on the company’s
website legislation in the uk governing the preparation and
dissemination of financial statements may differ from legislation 
in other jurisdictions
directors’ responsibility statement
each of the directors the names of whom are set out on page 49 of
this annual report confirms that to the best of his or her knowledge
• the financial statements prepared in accordance with the
applicable set of accounting standards give a true and fair view of
the assets liabilities financial position and the profit or loss of the
company and the undertakings included in the consolidation taken
as a whole and
• the directors’ report includes a review of the development and
performance of the business and the position of the issuer and 
the undertakings included in the consolidation taken as a whole
together with a description of the principal risks and uncertainties
that they face
the statement of directors’ responsibilities was approved by a duly
authorised committee of the board of directors on 30 november
2009 and signed on its behalf by paul bowtell chief financial officer
paul bowtell
chief financial officer
30 november 2009
governance
statement of directors’ responsibilities
in respect of the annual report and the financial statements
48 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
the board
the company is controlled through its board of directors – 
the directors at the date of this report are
director’s name title
horst baier nonexecutive director
dr volker böttcher managing director central europe
paul bowtell chief financial officer
t ony campbell nonexecutive director
clare chapman nonexecutive director
bill dalton nonexecutive director
rainer feuerhake nonexecutive director
dr michael frenzel nonexecutive chairman
jeremy hicks nonexecutive director
sir michael hodgkinson nonexecutive deputy chairman 
and senior independent director
peter long chief executive
johan lundgren managing director northern region
dr erhard schipporeit nonexecutive director
dr albert schunk nonexecutive director
harold sher nonexecutive director
giles thorley nonexecutive director
william waggott commercial director
all directors detailed above served throughout the year with the
exception of horst baier who was appointed on 13 october 2009
christoph mueller resigned as a director on 27 may 2009
as at 30 september 2009 the board comprised five executive
directors and 11 nonexecutive directors including the chairman
on 13 october 2009 horst baier was appointed as a nonexecutive
director biographical details of all the directors are set out on page 45
all directors are subject to reelection by shareholders at intervals of
no more than three years in accordance with the articles of association
and therefore each year onethird of the board members will retire
by rotation the directors retiring by rotation and offering themselves
for reelection at the annual general meeting agm on 9 february
2010 are dr michael frenzel t ony campbell clare chapman rainer
feuerhake and johan lundgren who all being eligible will offer
themselves for reelection horst baier having been appointed 
since the last agm will also offer himself for reelection t o enable
shareholders to make an informed decision the 2010 notice of the
agm includes additional biographical details and a statement as to
why the company believes the nonexecutive directors should be 
reelected the chairman intends to confirm at the agm that the
performance of each individual continues to be effective and
demonstrates commitment to the role
the board recommends to shareholders the reappointment of all six
directors retiring at the meeting on the basis that they are all effective
directors of the company and demonstrate the appropriate level of
commitment in their respective roles
the terms of the directors’ service contracts are disclosed in the
remuneration report commencing on page 53 directors’ interests 
in the shares of the company are disclosed on page 62
directors’ service contracts and the letters of appointment of the
nonexecutive directors are available for inspection at the company’s
registered office and will be available at the agm which is scheduled 
to take place on 9 february 2010
following the appointment of any new director the chairman in
conjunction with the company secretary ensures that a full formal
and tailored induction to the company is provided the company
secretary is available to answer any questions which may arise all
directors have been given a detailed induction and training manual
board proceduresresponsibilities
the board meets regularly including away days to review the strategy
of the group the schedule of matters specifically reserved to it for
decision include determining the strategy and control of the group
amendments to the structure and capital of the group approval of
financial reporting and controls oversight of the group’s internal
controls approval of capital and revenue expenditure of a significant
size acquisitions disposals and share dealings board membership
and appointments approval of remuneration of directors and certain
senior management corporate governance matters and approval of
group policies and risk management strategies
the division of responsibilities between the chairman and chief
executive is clearly established and has been agreed by the board
all directors have access to the advice and services of the company
secretary and all directors can take independent professional advice 
if necessary at the company’s expense no such advice was sought by
any director during the year
the company secretary is responsible for ensuring board procedures
are followed including the formal minuting of any unresolved concerns
that directors may have in connection with the operation of the
company during the year there were no such unresolved issues
the t erms of reference for the board and its committees are available
for inspection on the group’s website and will be available at the agm
directors’ conflicts of interests
from 1 october 2008 the directors became subject to a statutory
duty under the companies act 2006 to avoid a situation where they
have or could have a direct or indirect interest that conflicts or
possibly may conflict with the interests of the company directors 
of public companies may authorise conflicts and potential conflicts
where appropriate if the articles of association contain a provision 
to this effect
the company amended its articles of association in march 2008 to
deal with amongst other things the provisions on conflicts of interest
in the companies act 2006 the company has established formal
procedures for the disclosure and review of any conflicts or potential
conflicts of interest which the directors may have and for the
authorisation of such conflict matters by the board in deciding whether
to authorise a conflict or potential conflict the directors must have
regard to their general duties under the companies act 2006 the
authorisation of any conflict matter and the terms of authorisation
may be reviewed at any time and will be reviewed formally by the
board on an annual basis the board believes that the procedures
established to deal with conflicts of interest are operating effectively
board effectiveness and individual performance of directors
an assessment of the performance of the board and its individual
directors was commenced during the year the board’s effectiveness
was assessed by means of a detailed questionnaire which was
designed by the company secretary and completed by each director
the questionnaire covers 16 areas including the processes for setting
the strategy of the company monitoring business performance
corporate governance and the effectiveness of the executive directors
nonexecutive directors including the chairman and the board’s
committees the results were fed back to the chairman and a full
debate is scheduled to take place in the board before the end of 2009
corporate governance report
tui travel plc annual report  accounts 2009 49
wwwtuitravelplccom an assessment of each individual director’s performance is undertaken
annually the performance of each director is measured against 
12 criteria with peers being requested confidentially to rate that
director’s performance by reference to the criteria the chairman then
discusses the overall result for each director with him or her and any
concerns are addressed
independence of nonexecutive directors
the chairman dr michael frenzel did not meet the independence
criteria laid out in the provisions of the combined code at the time of
his appointment this is because dr frenzel is the chief executive of
tui ag – a 52 shareholder of the company as at 30 september 2009
details of the chairman’s other significant commitments are given in
his biography on page 45 the chairman does have a number of other
external roles but the board is satisfied that these do not interfere
with the performance of his duties as chairman of the company
of the other 11 nonexecutive directors two are not considered to 
be independent – rainer feuerhake and horst baier who are also
executive directors of tui ag
the nonexecutive directors considered to be independent are
sir michael hodgkinson t ony campbell clare chapman bill dalton
jeremy hicks dr erhard schipporeit dr albert schunk harold sher
and giles thorley
the board recognises that the combined code requires that at least
half the board excluding the chairman should be independent non
executive directors the board had 17 members up to 27 may 2009
when christoph mueller resigned of whom nine were deemed to be
independent from 28 may 2009 to 30 september 2009 the board
had 16 members of whom nine were also deemed to be independent
therefore the company was compliant with provision a32 of the
combined code throughout the year ended 30 september 2009
following the appointment of horst baier the board reverted to
17 members of which nine were deemed independent
the board is committed to seek to ensure that its membership is
regularly refreshed
meetings of the nonexecutive directors
the chairman met with the nonexecutive directors twice during the
year – in february and may a meeting has been scheduled for 2010
and others will be held as the need arises in the february meeting
there was general agreement that since the september 2007 merger
the chairman and the chief executive officer had cooperated well in
establishing a successful corporate culture which gave confidence in
the company’s ability to trade well through a period of unprecedented
economic turbulence the may meeting focused on the refinancing
requirements of the business
a meeting of the nonexecutive directors led by the senior
independent director took place during the year to appraise the
chairman’s performance after debate it was concluded that board
meetings are chaired effectively in an open and constructive manner
which encourages contribution from all nonexecutive directors
attendance of directors at meetings of the board and its committees
scheduled audit remuneration
board committee committee
meetings meetings meetings
dr volker böttcher md central europe 77 na na
paul bowtell chief financial officer 77 na na
t ony campbell nonexecutive director 67 78 77
clare chapman nonexecutive director 57 na 67
bill dalton nonexecutive director 67 68 67
rainer feuerhake nonexecutive director 77 na 67
dr michael frenzel chairman 67 na 57
jeremy hicks nonexecutive director 77 88 na
sir michael hodgkinson deputy chairman 77 na na
peter long chief executive 77 na na
johan lundgren md northern region 67 na na
christoph mueller aviation director 55 na na
dr albert schunk nonexecutive director 77 na na
harold sher nonexecutive director 77 na na
erhard schipporeit nonexecutive director 57 na na
giles thorley nonexecutive director 67 78 na
will waggott commercial director 77 na na
figures in brackets indicate the maximum number of meetings during the year in which the
individual was a board member the nomination committee did not meet during the year
governance
corporate governance report continued
50 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
tui travel plc
nomination committee remuneration committee audit committee
delegated authorities
sets remuneration and incentives for the executive 
directors approves and monitors remuneration and 
incentive plans for the group
members
c m chapman chairman
l a campbell
w r p dalton
dr m h f frenzel
r feuerhake
delegated authorities
ensures that the board and committee 
composition has the optimum balance of skills 
knowledge and experience by nominating suitable 
candidates for approval by the board to fill 
executive and nonexecutive vacancies
members
sir michael hodgkinson chairman
c m chapman
j d hicks 
dr m h f frenzel
r feuerhake
delegated authorities
monitors the group’s integrity in financial reporting 
and reviews the effectiveness of the risk 
management framework
members
j d hicks chairman
l a campbell 
w r p dalton
g a thorley
board governance structure group at a glance strategic overview business performance governance financial statements shareholder information
remuneration committee
see the remuneration report on page 53 for full details of the
remuneration committee its composition and work during the year
remuneration committee effectiveness review
during july and august 2008 the remuneration committee members
participated in an independent survey of committee members’
performance which was conducted by deloitte an analysis of the
results was produced at the end of august 2008 and considered at 
a meeting in october 2008 there was unanimous support for the
overall effectiveness of the committee the analysis indicated that
there were certain areas where effectiveness could be further
enhanced and the committee resolved to actively address these
points the committee considered reports and undertook discussions
on the relevant points in march 2009 and concluded they had been
fully addressed a new full performance evaluation process is
scheduled to commence in january 2010
nomination committee
the committee comprises five nonexecutive directors and is chaired
by sir michael hodgkinson the senior independent director
in relation to the appointment of horst baier who was appointed on
13 october 2009 a description of the role and required capabilities
was prepared prior to the appointment a meeting of the committee
– chaired by sir michael hodgkinson nonexecutive deputy
chairman – considered horst’s suitability for the role his other
significant commitments and the existing skills and knowledge of the
board as a whole as a significant percentage of the group’s turnover
is generated in germany it was believed that additional expertise and
experience in the differences between german and uk accounting
practices was required it was felt that horst’s experience in the leisure
travel industry as an executive director of tui ag and his previous
experience over a long career involving work of a financial nature
would assist the board and enable him to make an excellent
contribution to its deliberations for this reason it was not deemed
appropriate for an external search consultancy or open advertising to
be used for this appointment as the board was of the view that no
other candidate would be able to match the specific knowledge and
expertise horst brings to this role
at the meeting held in october the current membership and
effectiveness of the committee was also discussed and it was agreed
that the composition of the committee remained appropriate and
effective
audit committee
all members of the committee are considered to be independent 
in accordance with the combined code the board is satisfied that
jeremy hicks has ‘recent and relevant financial experience’
the chief financial officer and the director of group audit services
are normally invited to meetings and other directors including the
chief executive and the nonexecutive directors may also attend 
the chairman of the committee also meets with the external auditors
without management present
the committee’s duties which were discharged during the year include
• monitoring the integrity of the financial statements of the company
and formal announcements relating to the company’s financial
performance and reviewing the significant financial reporting
judgements contained in them
• reviewing the company’s internal financial controls and the
company’s internal control and risk management systems
• monitoring the effectiveness of the company’s group audit services
function through meetings with the director of group audit services
the agreement in advance of annual work plans and the review of
the results of the work undertaken
• the consideration of the appointment reappointment and removal
of the external auditors and the approval of their remuneration and
terms of their engagement
• a policy for the engagement of the external auditors to supply 
nonaudit services was approved in 2007 and remains in force the
audit committee has concluded that in some cases the provision
of nonaudit services by the incumbent auditors which does not
impact on their independence in providing their primary statutory
audit role is appropriate and this has been communicated to the
board auditor independence and objectivity are safeguarded by 
the audit committee monitoring and approving where appropriate
the nature of the work and the level of fees paid for nonaudit
services as a proportion of the total audit fees paid
audit committee effectiveness review
an assessment of the effectiveness was conducted during the year 
by a questionnaire sent by the company secretary to members of 
the audit committee and relevant executives results from the
questionnaires have been collated and the committee is scheduled 
to review and debate the findings before the end of 2009
internal control and risk
the board has overall responsibility for the group’s system of internal
control and for reviewing its effectiveness while the role of management
is to implement board policies on risk and control
the system of internal control is designed to manage and mitigate
rather than eliminate the risk of failure to achieve business objectives
in pursuing these objectives internal controls – which include financial
operational and compliance controls – and risk management can only
provide reasonable and not absolute assurance against material
misstatement or loss the board has reviewed the effectiveness of
internal controls during the year
the board confirms that there is an ongoing process for identifying
evaluating and managing the significant risks faced by the group that
this has been in place for the year under review and up to the date 
of approval of the annual report and accounts that this process is
regularly reviewed by the board and that the process accords with 
the turnbull guidance the key elements of the control framework 
and review processes in place across the group are as follows
• the board sets corporate strategy and business objectives 
the gmb and sector management integrate these objectives into
their operational and financial business plans where areas for
improvement in the system of internal control are identified the
board considers the recommendations made by the gmb and the
audit committee
• the gmb meets regularly together with other senior executives 
to consider group operational and financial performance and
business development the chief executive reports to the board 
on behalf of the gmb on significant changes in the business and
the external environment the chief financial officer provides the
board with financial information which includes key performance
and risk indicators
tui travel plc annual report  accounts 2009 51
wwwtuitravelplccom • group risk management have designed a framework for risk
management for tui travel plc in line with turnbull guidance
integrated with the short and long term business planning
processes they review the progress in line with this framework 
and report on the group risk profile on a quarterly basis providing
a consolidated group risk profile to the audit committee on a 
halfyearly basis additionally at each audit committee meeting 
the framework development is reported and individual sector
management teams are invited to review and discuss their risk
profile on a rotational basis
• the audit committee with assistance from certain related
management committees oversees key risks such as financial 
risk health and safety corporate and social responsibility and the
environment where such risks apply across all sectors the board
believes that in order to be effective risk management processes
must be driven down to each operating unit accordingly each
sector board now addresses risk management as a standing 
agenda item and is responsible for ensuring that the risks facing
that sector’s businesses are identified and that related action plans
are implemented sectors formally report their risk profile on a
quarterly basis
• the group audit services function independently reviews the risk
identification procedures and control processes implemented by
management and reports its findings at each audit committee
meeting or more frequently if appropriate
• the audit committee reviews the proposed work plans of the
group audit services function reports issued by group audit
services progress made on addressing findings arising from these
reports as well as reports on systems and controls from the external
auditors covering material weaknesses the chairman of the audit
committee reports to the board on the outcome of the audit
committee meetings held and the board receives the minutes 
of all such meetings
• the treasury position of the group including cash foreign exchange
and fuel hedging exposure is managed centrally in accordance with
policies appropriate for each sector and is the responsibility of the
chief financial officer and group treasurer reports and forecasts
are submitted monthly to the gmb and to each board meeting
weekly meetings on liquidity and fuel hedging take place attended
by the chief executive chief financial officer group treasurer and
other senior managers as deemed necessary
• financial forecasts providing predicted results with sensitivity
analysis are prepared routinely throughout the year for review 
by the gmb and the board these forecasts also include details 
of the group’s ongoing compliance with its regulatory and banking
requirements the group has established investment appraisal and
authorisation procedures and its capital expenditure is reviewed
against budgets which have been approved by the board
processes are in place to ensure appropriate action is taken where
necessary to remedy any deficiencies identified through the group’s
internal control and risk management processes
there are policies and procedures for the reporting by employees and
the resolution of suspected fraudulent activities it is the policy of the
group to employ staff and management of high integrity to train
them appropriately and to require compliance with all relevant laws
regulations and internal policies the group has independent third
party reporting mechanisms that allow employees to raise concerns 
on financial reporting or other matters any reports received are
passed direct to group audit services which acknowledges receipt and
periodically reports back on a confidential basis to the independent
third party on any action taken within its regular report to the audit
committee group audit services provides a summary of any
confidential reports received and actions taken a monthly report 
is also produced which includes a summary of all calls received
highlighting any issues raised for further information see risk
management on page 20
communication with shareholders
the chief executive and chief financial officer hold regular meetings
with major shareholders to review the group’s performance and
prospects the views of shareholders are communicated to all
members of the board following such meetings during the course 
of these meetings the issue of governance is discussed presentations
to major shareholders are made at least twice yearly after the
announcement of the interim and preliminary results details of which
together with the group’s financial reports and other announcements
can be accessed via the group’s website wwwtuitravelplccom
the combined code recommends that the senior independent
director meets with a range of major shareholders to gain an
understanding of their views in practice and as a result of the
extensive investor feedback provided by the chief executive and the
chief financial officer the senior independent director and other
nonexecutive directors believe that they are aware of such issues
and therefore considered that it was not necessary to arrange
meetings with major shareholders for this purpose during the year
however they would make themselves available if any major
shareholder requested such a meeting
there is also an opportunity for shareholders to question the
chairman and other directors including the chairmen of the audit
remuneration and nomination committees at the annual general
meeting this forum also provides nonexecutive directors with the
opportunity to discuss the views of shareholders with them directly
at general meetings
• the company prepares separate resolutions on each substantially
separate issue and does not combine resolutions together
inappropriately
• a schedule of proxy votes cast is made available for inspection at
the conclusion of the proceedings and
• the annual report and accounts is laid before shareholders at the
annual general meeting
combined code provisions
for the reasons disclosed above and in the remuneration report on
page 53 during the year the company did not fully comply with the
following provisions
• code provision a22 the chairman should on appointment meet
the independence criteria set out in code a31
• code provision b21 the remuneration committee should all be
independent nonexecutive directors and
• code provision d11 the senior independent director should meet
with a range of major shareholders to listen to their views in order
to help develop a balanced understanding of the issues and
concerns of major shareholders
governance
corporate governance report continued
52 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
the remuneration committee the committee formulates and
applies the company policy with consideration to the prevailing
economic climate in the major economies within which it operates and
within the spirit of its core values which cultivate responsible leadership
in its external and internal social environment consequently the
committee closely considers the company’s sustained performance 
in building both shareholder value and a secure future for all 
its stakeholders
this report has been prepared by the committee and has been
approved by the board it complies with schedule 8 of the large and
medium sized companies and groups accounts and reports
regulations 2008 this report will be put to shareholders for approval
at the annual general meeting to be held on 9 february 2010
remuneration committee
during the year the committee comprised the following 
nonexecutive directors
clare chapman – chairman
t ony campbell
bill dalton
dr michael frenzel
rainer feuerhake
three of the members of the committee are independent non
executive directors dr michael frenzel and rainer feuerhake are not
considered by the company to be independent dr frenzel and rainer
feuerhake are members of the executive board of tui ag – a 52
shareholder of tui travel plc as at 30 september 2009 – and their
appointments are pursuant to the relationship agreement between
tui ag and the company
no member of the committee has any personal financial interest
other than as a shareholder as disclosed in the interests in shares
table on page 62 in the matters to be decided by the committee
the three independent members of the committee have no conflicts
of interest arising from committee members’ crossdirectorships and
none of the members of the committee participate in any bonus
schemes pension plans share awards or any employee share schemes
in respect of the company members of the committee have no day
today involvement in the running of the company
the committee met seven times during the year michael frenzel was
unable to attend on two occasions and clare chapman bill dalton and
rainer feuerhake were unable to attend on one occasion all due to
prior commitments
the committee advises the board on overall remuneration policy 
the committee also determines on behalf of the board and with 
the benefit of advice from external consultants and members of the
human resources department the remuneration of the executive
directors and other members of the group management board the
activities of the committee are governed by its t erms of reference
which have been approved by the board and can be found on the 
tui travel website at wwwtuitravelplccom
material advice or services were provided to the committee during 
the year by
mercer human resource consulting mercer
deloitte llp deloitte
herbert smith llp herbert smith
peter long – chief executive
paul bowtell – chief financial officer
bill logan – group human resources director
david house – group reward director
bill logan has direct access to the chairman of the committee and he
together with david house advised the committee on all aspects of
the group’s reward policies and structures during the year peter long
attends meetings of the committee to make recommendations
relating to the performance and remuneration of his direct reports 
and andrew john company secretary acts as secretary to the
committee peter long paul bowtell bill logan and andrew john 
are not in attendance when their own remuneration is considered
during the year the committee appointed deloitte who succeeded
mercer both external consultancy organisations to provide independent
advice on all aspects of senior management remuneration deloitte
also provides salary benchmarking information and tax services to the
group from time to time and verification of the relative performance
conditions attached to the performance share plan and deferred
annual bonus scheme
herbert smith advised on various legal issues relating to the company’s
share schemes and also provides other legal services to the group
policy on remuneration of nonexecutive directors
nonexecutive directors including the chairman do not have service
contracts and do not participate in the group’s pension scheme
annual bonus scheme or long term incentive schemes nonexecutive
directors have letters of appointment which can be terminated by
either party serving six months’ notice each appointment is subject 
to retirement by rotation under the articles of association of the
company and reelection by shareholders at least once every 
three years
nonexecutive directors are paid a fee which is approved by the board
on the recommendation of the executive directors having taken
account of the fees paid in other companies of a similar complexity
and the skills and experience of the individuals the base fee for the
nonexecutive directors is £55000 but the chairman and deputy
chairman who is also the senior independent director are paid
higher fees to reflect their additional responsibilities the chairman
receives a fee of £300000 and the deputy chairman receives a fee 
of £200000 the chairman of the audit committee and the chairman
of the remuneration committee receive an additional fee of £15000
and £10000 respectively
policy on remuneration of executive directors and
senior executives
the committee aims to ensure that remuneration packages are
offered which
• set the total remuneration package at an appropriate level to reflect
the competitive market in which the group operates
• link a substantial proportion of the total remuneration package to
the achievement of demanding financial performance targets
• structure the reward of senior management to align their interests
with those of the shareholders over the long term and
• reinforce the highperformance culture throughout the group
remuneration report
tui travel plc annual report  accounts 2009 53
wwwtuitravelplccom the group has performancerelated reward policies these are designed
to provide the appropriate balance between fixed remuneration and
variable ‘atrisk’ reward which is linked to the performance of both the
group and the individual group performancerelated measures are
chosen carefully to ensure a strong link between reward and true
underlying financial performance individual performance is measured
through an assessment of comprehensive business unit deliverables
modelling the group’s values and the achievement of specific objectives
at a minimum the individual performance of the executive directors is
assessed on an annual basis
in assessing levels of pay and benefits tui travel compares the
packages offered by different groups of comparator companies 
these groups are chosen having regard to
• financial size – turnover profits and market capitalisation
• scale of business – the number of people employed
• diversity and complexity of businesses
• geographical spread of businesses
• industry type and
• relevance as
– a potential source for candidates for roles within the group and
– a potential threat in respect of attracting tui travel executives
external consultants are used to advise the committee on the
structure and level of pay and benefits in tui travel’s markets
the normal policy for executive directors is that using ‘target’ or
‘expected value’ calculations long term performance drives 60 
of total annual remuneration excluding benefits and the total
proportion of performancerelated remuneration including annual
bonus is 70
the main components of remuneration in the company are
• fixed remuneration
– base salary
– benefits
– pension contribution
• performancerelated remuneration
– annual bonus
– long term incentives
base salary
the salary for each executive director is based on individual
performance and on information from independent professional
sources on the salary levels for similar jobs in groups of comparable
companies this approach is consistent with that used to determine
salary and benefit levels for all employees within the group internal
relativities and salary levels in the wider employment market are also
taken into account
fixed remuneration
annual incentive
long term incentive
 
during the year the committee decided that it was not appropriate to
increase fixed remuneration in the current climate consequently the
executive directors’ base salaries were not increased at the normal
annual review in october 2009 and will remain at 2009 levels during
the financial year to 30 september 2010 in addition the committee
does not anticipate undertaking the next normal annual review prior
to 1 october 2011
benefits are provided to executive directors in accordance with the
practice applying to other executives in their geographic location
annual performance bonus
within the annual bonus plan challenging performance goals are set
and these must be achieved before the maximum bonus becomes
payable the annual bonus plan measures are weighted heavily to 
the group’s financial performance and the balance to personal
objectives the maximum bonus opportunity for each executive
director varies by individual but will not exceed 175 of annual base
salary the maximum bonus opportunity is greater than the maximum
bonus for the financial year ending 30 september 2009 150 this
change combined with not increasing fixed remuneration implements
a policy decision to increase the portion of total remuneration that is
performance related this will have the benefit of helping to manage
the group’s fixed cost base and improve the alignment between
executive reward and the value created for shareholders
long term incentives
deferred annual bonus scheme
all executive directors also participate in the deferred annual bonus
scheme dabs which requires a minimum of 25 and a maximum 
of 50 of any annual performance bonus payable to be deferred into
awards of shares matching shares may also be awarded up to four
times the deferred amount and are subject to the achievement of
stretching performance conditions awards of deferred and matching
shares are subject to forfeiture conditions until the release date the
earliest point at which the shares are eligible for release is at the end
of three years following deferral
for awards of matching shares made during the year no shares will
vest unless the annual average of the ratio of the group’s return on
invested capital roic to the weighted average cost of capital wacc
meets or exceeds one over the threeyear period a hurdle of roic
being at least equal to wacc is used to ensure that the relevant long
term incentive awards pay out only when shareholder value is being
created over the performance periods if the roicwacc hurdle is met
shares will only vest to the extent to which two further performance
conditions are satisfied over the threeyear period as follows
• up to threequarters of the matching shares will vest based on
growth in the group’s earnings per share eps before amortisation
of goodwill and merger intangibles goodwill impairment and
separately disclosed items in relation to the growth in the uk retail
price index rpi as shown in the table below
average annual eps growth in excess of rpi growth proportion of matching shares vesting
below 4 0
between 4 and 13 on a straightline basis 
between 10 and 100
13 or above 100
governance
remuneration report continued
54 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
• up to onequarter of the matching shares will vest based on the
group’s ranking of total shareholder return tsr performance
relative to companies ranked 30th to 100th by market capitalisation
as at the date of the award as shown in the table below
tsr ranking proportion of matching shares vesting
below median 0
between median and upper quartile on a straightline basis
between 15 and 100
at or above upper quartile 100
matching share awards lapse if the performance conditions are not met
performance share plan
the performance share plan psp allows executive directors and
eligible participants to receive share awards subject to the satisfaction
of performance conditions set by the committee which are normally
measured over a threeyear period awards are normally made annually
and except in exceptional circumstances will not exceed two times
annual salary for executive directors
for awards made during the year no shares will vest unless the annual
average of the ratio of the group’s roic to the wacc meets or
exceeds one over the threeyear period
if the roicwacc hurdle is met shares will only vest to the extent to
which two further performance conditions are satisfied over the three
year period as follows
up to half of the shares will vest based on growth in the group’s eps
before amortisation of goodwill and merger intangibles goodwill
impairment and separately disclosed items in relation to the growth 
in the uk rpi as shown in the table below
average annual eps growth in excess of rpi growth proportion of shares vesting
below 4 0
between 4 and 13 on a straightline basis
between 10 and 100
13 or above 100
• up to half of the shares will vest based on the group’s ranking of
tsr performance relative to companies ranked 30th to 100th by
market capitalisation as at the date of the award as shown in the
table below
tsr ranking proportion of shares vesting
below median 0
between median and upper quartile on a straightline basis
between 15 and 100
at or above upper quartile 100
awards under the performance share plan lapse if the performance
conditions are not met
the committee considers that eps and tsr are the key performance
conditions that are most relevant to the group eps is a key indicator
of the group’s underlying financial performance whilst tsr is a relative
measure of shareholder value creation a hurdle of roic being at least
equal to wacc is used to ensure that the relevant long term incentive
awards pay out only when shareholder value is being created over the
performance periods
value creation synergy plan
under the value creation synergy plan vcsp which is a oneoff
threeyear plan executive directors and eligible participants will
receive an award which will be satisfied by a combination of cash and
shares provided that stretching performance targets are satisfied 
the performance targets set by the committee are based on the
achievement of the synergistic objectives of the merger of first choice
holidays plc now first choice holidays limited and the t ourism
division of tui ag
the maximum aggregate awards for executive directors are
maximum value of aggregate 
director award  of base salary
dr volker böttcher 225
paul bowtell 330
peter long 450
johan lundgren 330
william waggott 330
the awards will be a combination of cash and shares which will vest 
in three tranches over three years as shown below
tranche 1 20072008 50 cash and 50 shares
tranche 2 20082009 50 cash and 50 shares and
tranche 3 20092010 100 cash
while any cash entitlement will be paid annually shares will be
deferred until the end of the threeyear period
the vesting of the annual tranches will be subject to the achievement
of annual performance targets over the threeyear period the release
of the share elements will be subject to a further overall threeyear
performance target
the overall threeyear performance targets have been set at a target
of £100m of synergistic value below which no vesting will occur with
a payment and vesting scale up to a ‘stretch’ level of £150m in
addition the committee have set annual profit margin targets below
which no payment or vesting will occur
at target and stretch annual performance the proportion vesting
under each annual tranche will be 50 and 100 respectively in the
event that the overall threeyear performance target is not achieved
any net amounts that have been previously paid in relation to the cash
elements of tranches 1 and 2 must be repaid to the company
allemployee share schemes
executive directors based in the uk are eligible to participate in the
hmrcapproved share incentive plan which is an allemployee share
scheme enabling staff to acquire shares in the company on preferential
terms t o further encourage employee shareholding in the company
the share incentive plan provides a matching share for every four
shares bought by a participant under the plan matching shares are
not subject to performance conditions
shareholding guidelines
the executive directors will be expected to build within five years 
of their appointment and then maintain a shareholding equal in 
value to 15 times their basic salary or two times in the case of the
chief executive
no new shares were issued during the year and therefore the company
has remained within its headroom limits for the issue of new shares
under share incentive schemes all share incentive awards made and
all future share incentive awards will normally be settled with shares
purchased in the market
tui travel plc annual report  accounts 2009 55
wwwtuitravelplccom policy on pensions
each of the ukbased executive directors and senior executives
participates in a defined contribution retirement plan
the group’s pension policy is that in the event that a participant in 
a registered pension scheme may reach or exceed hmrc lifetime or
annual thresholds and therefore chooses not to accept further
registered pension contributions a contribution to an unregistered
long term investment scheme or a nonpensionable cash payment
equivalent to the group’s contribution to the registered pension
scheme will be offered in lieu pension scheme participants will not 
be compensated for any adverse tax consequences of exceeding the
hmrc lifetime allowance limit
executive directors and senior executives outside of the uk
participate in local pension plans
policy on external appointments
the company recognises that its directors may be invited to become
nonexecutive directors of other companies and that such duties can
broaden experience and knowledge and benefit the business subject
to the approval of the board executive directors are therefore
allowed to accept nonexecutive appointments and to retain the fees
received excluding positions where the director is appointed as the
company’s representative as long as this is not likely to lead to a
conflict of interest
for the year ended 30 september 2009 peter long received and
retained nonexecutive directors’ fees in respect of two appointments
debenhams plc to 1 august 2009 and rentokil initial plc – ftse 250
and ftse 100 respectively of £97500 2008 £105000 paul bowtell
received and retained nonexecutive director fees in respect of his
appointment as a nonexecutive director of sthree plc a small cap
company of £40000 2008 £36667
performance graph
tui travel shares were listed on the london stock exchange on 
3 september 2007 since december 2007 the company has been 
a member of the ftse 100 index the graph below measures the
performance of first choice holidays plc up to the merger and
subsequently the performance of tui travel plc assuming dividends
are reinvested compared with the tsr performance achieved against
the constituent companies of the ftse 100 index and separately
those ranked 30 to 100 by market capitalisation the latter index is
considered to be the most appropriate benchmark for comparison
purposes and is used within the performance measures of the
company’s long term incentive schemes
contracts of service
executive directors
the remuneration committee’s policy is for executive directors to
have rolling contracts with a 12month notice period
volker böttcher paul bowtell peter long johan lundgren and william
waggott currently have service agreements with a 12month notice
period and it is intended that all new appointments will also have 
12month notice periods however on occasion to complete an
external recruitment successfully a longer initial period may be used
reducing to 12 months following guidance in the combined code
no provisions for compensation for termination following change 
of control or for liquidated damages of any kind are included in the
current directors’ contracts in the event of any early termination 
of an executive director’s contract the policy is to seek to minimise
any liability
effective date unexpired term
executive director of contract notice period
dr volker böttcher 5 september 2007 12
paul bowtell 7 april 2008 12
peter long 19 february 2008 12
johan lundgren 20 march 2009 12
william waggott 22 april 2008 12
nonexecutive directors
effective date unexpired term
nonexecutive director of appointment notice period
horst baier 13 october 2009 6
t ony campbell 3 september 2007 6
clare chapman 3 september 2007 6
bill dalton 3 september 2007 6
rainer feuerhake 3 september 2007 6
dr michael frenzel 3 september 2007 6
jeremy hicks 3 september 2007 6
sir michael hodgkinson 3 september 2007 6
giles thorley 3 september 2007 6
dr erhard schipporeit 29 october 2007 6
dr albert schunk 29 october 2007 6
harold sher 29 october 2007 6
governance
remuneration report continued
56 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
350
300
250
200
150
100
tui t ravel plc
ftse 100
ftse 30100
tui travel plc shares
listed 030907
300904 300905 300906 300907 300908 300909
total shareholder return
tui travel plc v ftse 100  ftse 30300 group at a glance strategic overview business performance governance financial statements shareholder information
the information provided in the following pages of this report has been audited by kpmg audit plc
directors’ remuneration
t otal remuneration
excluding pensions
for the year for the year
ended ended
basic salaries performance 30 september 30 september
and fees payments
1
benefits
2
2009 2008
£000 £000 £000 £000 £000
executive directors
dr volker böttcher
3
474 405 12 891 743
paul bowtell 490 547 16 1053 1005
peter long 850 1238 35 2122 2029
johan lundgren
4
597 567 273 1437 1109
christoph mueller
5
426 19 445 750
william waggott 430 435 16 881 835
nonexecutive directors
t ony campbell 55 55 55
clare chapman 65 65 65
bill dalton 55 55 55
rainer feuerhake 55 55 55
dr michael frenzel chairman 300 300 300
jeremy hicks 70 70 70
sir michael hodgkinson deputy chairman 200 200 200
dr erhard schipporeit 55 55 50
dr albert schunk 55 55 50
harold sher 55 55 50
giles thorley 55 55 55
former directors 2402
total 4287 3192 371 7849 9878
1 ’performance payments’ include bonus awards in cash in respect of participation in the annual bonus plan and the value creation synergy plan but exclude bonus awards in deferred shares details
of which are set out on page 59 messrs böttcher bowtell long and waggott achieved the maximum level for both annual bonus and vcsp mr lundgren achieved 863 of the maximum for annual
bonus and the maximum for vcsp 
2 ’benefits’ incorporate all tax assessable benefits arising from the individual’s employment for messrs bowtell long and waggott this relates in the main to the provision of a fully expensed company
car or car allowance and private healthcare cover and for messrs böttcher and mueller the provision of a fully expensed company car or car allowance in addition to the provision of a fully expensed
company car or car allowance and private healthcare cover mr lundgren relocated from sweden to the uk on 1 august 2009 and received relocation housing and education benefits
3 in calculating remuneration for mr böttcher payments made during the year in eur have been converted at 115 units to 1 gbp  being the average exchange rate for the period 1 october 2008 
to 30 september 2009
4 in calculating remuneration for mr lundgren payments made during the year in sek have been converted at 1219 units to 1 gbp  being the average exchange rate for the period 1 october 2008 to
31 july 2009
5 mr mueller resigned as a director on 27 may 2009 and ceased employment on 31 august 2009 due to redundancy in calculating his remuneration payments made during the year in eur have been
converted at 115 units to 1 gbp being the average exchange rate for the period 1 october 2008 to 31 august 2009
tui travel plc annual report  accounts 2009 57
wwwtuitravelplccom directors’ pensions
the group makes a contribution of 50 of base salary for peter long during the year contributions have been paid partly into a selfinvested
personal pension and mindful of the hmrc lifetime allowance limit partly as a nonpensionable cash payment subject to tax and national
insurance equivalent to the company pension contribution
the group makes contributions of 25 and 50 of base salary into a defined contribution pension scheme for the benefit of paul bowtell and
william waggott respectively
in addition william waggott has deferred pension entitlements under the defined benefit section of the tui pension scheme uk he ceased 
to be an active member of the defined benefit section on 3 september 2007 and therefore no increase in accrued benefit has occurred during
the year
the normal retirement date for the ukbased executive directors and senior executives is 65
in the event of death in service the executive directors’ and senior executives’ pension arrangements provide lump sums for the purchase of
dependants’ pensions of the greater of eight times salary or the value of the pension fund in addition to which a lump sum of four times salary 
is payable following the changes to the tax rules from april 2006 any dependant’s pension may be paid as an additional lump sum subject to
hmrc limits
dr volker böttcher participates in separate pension arrangements in germany at a cost of 25 of base salary
johan lundgren participated in a separate pension arrangement in sweden at a cost of 33 of base salary
christoph mueller participated in separate pension arrangements in germany at a cost of 35 of base salary until his employment ceased 
the company made an additional pension contribution of €46813 in accordance with his contractual termination arrangements
pension contributions for directors
pension contributions or allowance for
the year ended 30 september 2009
executive director £000
dr volker böttcher 118
paul bowtell 123
peter long 425
johan lundgren 200
christoph mueller
1
190
william waggott 208
total 1264
1 christoph mueller ceased employment on 31 august 2009
t otal pension contributions or allowances for the year ended 30 september 2009 were £1264m in calculating this total payments made in eur
and sek have been converted at 115 and 1210 units to 1 gbp respectively being the average exchange rates for the year ended 30 september
2009
long term incentives
deferred annual bonus scheme dabs
messrs böttcher bowtell long lundgren and waggott participated in the dabs during the year ended 30 september 2009 and are expected 
to receive an award on 2 december 2009 as follows
estimated value of award
director £000
dr volker böttcher 237
paul bowtell 294
peter long 638
johan lundgren 258
william waggott 215
awards made under the dabs and which remain outstanding at 30 september 2009 are given in the table on page 59
58 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
governance
remuneration report continued group at a glance strategic overview business performance governance financial statements shareholder information
deferred annual bonus scheme dabs
maximum
value based
dabs shares dabs shares maximum on share price
dabs shares awarded during vested during dabs shares of 2546p at
held at the year ended market price the year ended market price value at held at 30 september
1 october 30 september per share 30 september per share vesting plannedactual 30 september 2009
2008 2009 award date at award 2009 at vesting £ vesting date 2009 £
directors
dr volker böttcher 60432
3
191207 27040p 191210 60432 153860
241729
4
191207 27040p 191210 241729 615442
104809
5
281108 20525p 281111 104809 266844
419236
6
281108 20525p 281111 419236 1067375
t otal 302161 524045 826206 2103521
paul bowtell 81426 141205 22925p 81426
1
21862p 178014 151208 – –
156923
2
130207 26000p 130210 156923 399526
67599
3
191207 27040p 191210 67599 172107
270394
4
191207 27040p 191210 270394 688423
134470
5
281108 20525p 281111 134470 342361
537880
6
281108 20525p 281111 537880 1369442
t otal 576342 672350 81426 178014 1167266 2971859
peter long 174483 141205 22925p 174483
1
21862p 381455 151208 – –
326155
2
130207 26000p 130210 326155 830391
138288
3
191207 27040p 191210 138288 352081
553150
4
191207 27040p 191210 553150 1408320
292326
5
281108 20525p 281111 292326 744262
1169304
6
281108 20525p 281111 1169304 2977048
t otal 1192076 1461630 174483 381455 2479223 6312102
johan lundgren 67431
3
191207 27040p 191210 67431 171679
269723
4
191207 27040p 191210 269723 686715
135446
5
281108 20525p 281111 135446 344846
541784
6
281108 20525p 281111 541784 1379382
t otal 337154 677230 1014384 2582622
christoph mueller 54417
3
191207 27040p 54417
7
23470p 127717 010909 – –
217666
4
191207 27040p 55069
8
23470p 129247 010909 – –
104809
5
281108 20525p 104809
7
23470p 245987 010909 – –
419236
6
281108 20525p 35356
8
23470p 82981 010909 – –
t otal 272083 524045 249651 585932 – –
william waggott 73558
3
191207 27040p 191210 73558 187279
294230
4
191207 27040p 191210 294230 749110
97442
5
281108 20525p 281111 97442 248087
389768
6
281108 20525p 281111 389768 992349
t otal 367788 487210 854998 2176825
grand total 3047604 4346510 505560 1145401 6342077 16146929
1 this ‘rollover’ award was based on a performance to 30 september 2008 where the performance measure relates to eps growth in excess of the rate of inflation and b performance to the 3rd
anniversary of the award date where the performance measure relates to the company’s tsr ranking against the constituent companies of the ftse mid250 index excluding investment trusts 
as calculated at the award date a performance hurdle of the roic being in excess of the wacc must also be achieved for any of the award to be released the number of shares released is graded
according to a eps growth with 75 of the award being released for 4 per annum in excess of inflation and 75 of the award released for 13 per annum in excess of inflation and b ranking 
of the company against the comparator group with 25 of the award being released for median and 25 of the award being released for upper quartile the roicwacc hurdle was achieved 
eps growth was greater than 13 per annum in excess of inflation and the company tsr ranking was in the upper quartile therefore the entire award was released on 14 december 2008
2 this ‘rollover’ award is based on a performance to 30 september 2009 where the performance measure relates to eps growth in excess of the rate of inflation and b performance to the 3rd
anniversary of the award date where the performance measure relates to the company’s tsr ranking against the constituent companies of the ftse mid250 index excluding investment trusts 
as calculated at the award date a performance hurdle of the roic being in excess of the wacc must also be achieved for any of the award to be released the number of shares released is graded
according to a eps growth with 75 of the award being released for 4 per annum in excess of inflation and 75 of the award released for 13 per annum in excess of inflation and b ranking 
of the company against the comparator group with 25 of the award being released for median and 25 of the award being released for upper quartile
3 this award is the deferred element of the annual bonus entitlement for financial year 20062007 and is subject only to continued employment to the release date
4 this matching award is based on a performance to 30 september 2010 where the performance measure relates to eps growth in excess of the rate of inflation and b performance to the 
3rd anniversary of the award date where the performance measure relates to the company’s tsr ranking against the constituent companies of the ftse 100 index ranked 30 to 100 by market
capitalisation as calculated at the award date a performance hurdle of the return on roic being in excess of the wacc must also be achieved for any of the award to be released the number 
of shares released is graded according to a eps growth with 75 of the award being released for 12 in excess of inflation and 75 of the award released for 39 in excess of inflation and 
b ranking of the company against the comparator group with 375 of the award being released for median and 25 of the award being released for upper quartile
5 this award is the deferred element of the annual bonus entitlement for financial year 20072008 and is subject only to continued employment to the release date
6 this matching award is based on a performance to 30 september 2011 where the performance measure relates to eps growth in excess of the rate of inflation and b performance to the 3rd
anniversary of the award date where the performance measure relates to the company’s tsr ranking against the constituent companies of the ftse 100 index ranked 30 to 100 by market
capitalisation as calculated at the date a performance hurdle of the roic being in excess of the wacc must also be achieved for any of the award to be released the number of shares released 
is graded according to a eps growth with 75 of the award being released for 12 in excess of inflation and 75 of the award released for 39 in excess of inflation and b ranking of the
company against the comparator group with 375 of the award being released for median and 25 of the award being released for upper quartile
7 christoph mueller ceased employment with effect from 31 august 2009 due to redundancy under the terms of his departure and in accordance with the scheme rules these deferred awards were released in full
8 christoph mueller ceased employment with effect from 31 august 2009 due to redundancy under the terms of his departure and in accordance with the scheme rules these matching awards were
released early subject to proration for time elapsed and performance to cessation of employment
tui travel plc annual report  accounts 2009 59
wwwtuitravelplccom performance share plan psp
during the year ended 30 september 2009 there were four cycles in operation
the award made in respect of each cycle and the maximum pretax number of ordinary shares due if performance targets are achieved in full are
maximum
maximum value based
maximum psp shares psp shares maximum on share price
psp shares awarded during vested during psp shares of 2546p at
held at the year ended market price the year ended market price value at held at 30 september
1 october 30 september per share 30 september per share vesting plannedactual 30 september 2009
2008 2009 award date at award 2009 at vesting £ vesting date 2009 £
directors
dr volker böttcher 39444 030907 28550p 39444
1
21928p 86493 151208 – –
78888
2
– 030907 28550p – 130210 78888 200849
129209
3
– 130907 27300p – 011210 129209 328966
221829
4
281108 20525p – 281111 221829 564777
t otal 247541 221829 39444 86493 429926 1094592
paul bowtell 38168 141205 22925p 38168
1
21928p 83695 151208
74039
2
– 130207 26000p – 130210 74039 188503
202198
3
– 130907 27300p – 011210 202198 514796
286479
4
281108 20525p – 281111 286479 729376
t otal 314405 286479 38168 83695 562716 1432675
peter long 92476 141205 22925p 92476
1
21928p 202781 151208
173078
2
– 130207 26000p – 130210 173078 440657
586081
3
– 130907 27300p – 011210 586081 1492162
828258
4
281108 20525p – 281111 828258 2108745
t otal 851635 828258 92476 202781 1587417 4041564
johan lundgren 65174 030907 28550p 65174
1
21928p 142914 151208
130348
2
– 030907 28550p – 130210 130348 331866
104773
3
– 130907 27300p – 011210 104773 266752
192307
3
191207 27040p – 191210 192307 489614
287106
4
281108 20525p – 281111 287106 730972
t otal 492602 287106 65174 142914 714534 1819204
christoph mueller 55221 030907 28550p 55221
1
22050p 121762 151208 – –
110443
2
– 030907 28550p 43465
5
23470p 102012 010909 – –
129209
3
– 130907 27300p 38791
5
23470p 91042 010909 – –
217759
4
281108 20525p 19622
5
23470p 46053 010909 – –
t otal 294873 217759 157099 360869 – –
william waggott 122343 030907 28550p 122343
1
22050p 269766 151208 – –
244685
2
– 030907 28550p – 130210 244685 622968
146520
3
– 130907 27300p – 011210 146520 373040
209500
4
281108 20525p – 281111 209500 533387
t otal 513548 209500 122343 269766 600705 1529395
grand total 2714604 2050931 514704 1146518 3895298 9917430
1 this ‘rollover’ award was based on performance from 1 november 2005 to 30 september 2008 where the performance measure related to eps growth in excess of the rate of inflation and a
performance hurdle of the roic being in excess of the wacc the number of shares released is graded according to eps growth with 10 of the award being released for 4 pa in excess of
inflation and the entire award released for 13 per annum in excess of inflation the roicwacc hurdle was achieved and eps growth was greater than 13 per annum in excess of inflation
therefore the entire award was released on 14 december 2008
2 this ‘rollover’ award is based on performance from 1 november 2006 to 30 september 2009 where the performance measure relates to eps growth in excess of the rate of inflation and a
performance hurdle of the roic being in excess of the wacc the number of shares released is graded according to eps growth with 10 of the award being released for 4 per annum in excess 
of inflation and the entire award released for 13 per annum in excess of inflation
3 this award is based on a performance to 30 september 2010 where the performance measure relates to eps growth in excess of the rate of inflation and b performance to the 3rd anniversary 
of the award date where the performance measure relates to the company’s tsr ranking against the constituent companies of the ftse 100 index ranked 30 to 100 by market capitalisation as
calculated at the award date a performance hurdle of the roic being in excess of the weighted average cost of capital wacc must also be achieved for any of the award to be released the
number of shares released is graded according to a eps growth with 5 of the award being released for 12 in excess of inflation and 50 of the award released for 39 in excess of inflation 
and b ranking of the company against the comparator group with 75 of the award being released for median and 50 of the award being released for upper quartile
4 this award is based on a performance to 30 september 2011 where the performance measure relates to eps growth in excess of the rate of inflation and b performance to the 3rd anniversary 
of the award date where the performance measure relates to the company’s tsr ranking against the constituent companies of the ftse 100 index ranked 30 to 100 by market capitalisation as
calculated at the award date a performance hurdle of the roic being in excess of the wacc must also be achieved for any of the award to be released the number of shares released is graded
according to a eps growth with 5 of the award being released for 12 in excess of inflation and 50 of the award released for 39 in excess of inflation and b ranking of the company against
the comparator group with 75 of the award being released for median and 50 of the award being released for upper quartile
5 christoph mueller ceased employment with effect from 31 august 2009 due to redundancy under the terms of his departure and in accordance with the scheme rules these awards were released
early subject to proration for time elapsed and performance to cessation of employment
60 tui travel plc annual report  accounts 2009
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governance
remuneration report continued group at a glance strategic overview business performance governance financial statements shareholder information
value creation synergy plan vcsp
messrs böttcher bowtell long lundgren and waggott participated in the vcsp during the year ended 30 september 2009 and are expected to
receive a deferred share award on 2 december 2009 as follows
estimated value of award
executive director £000
dr volker böttcher 168
paul bowtell 253
peter long 600
johan lundgren 309
william waggott 220
awards made under the vcsp and which remain outstanding at 30 september 2009 are given in the table below
maximum
value based
vcsp shares vcsp shares maximum on share price
vcsp shares awarded during vested during vcsp shares of 2546p at
held at the year ended market price the year ended market price value at held at 30 september
1 october 30 september per share 30 september per share vesting plannedactual 30 september 2009
2008 2009 award date at award 2009 at vesting £ vesting date 2009 £
directors
dr volker böttcher 78606
1
281108 20525p – 281111 78606 200131
t otal 78606 – 78606 200131
paul bowtell 123264
1
281108 20525p – 281111 123264 313830
t otal 123264 – 123264 313830
peter long 292326
1
281108 20525p – 281111 292326 744262
t otal 292326 – 292326 744262
johan lundgren 148990
1
281108 20525p – 281111 148990 379329
t otal 148990 – 148990 379329
christoph mueller 78606
1
281108 20525p 39774
2
23470p 93350 010909 – –
t otal 78606 39774 93350 – –
william waggott 107186
1
281108 20525p – 281111 107186 272896
t otal 107186 – 107186 272896
grand total 828978 39774 93350 750372 1910448
1 this award is the deferred element of tranche 1 of the vcsp for financial year 20072008 a profit margin performance hurdle must also be achieved for any of the award to be released the number
of shares released is graded according to synergistic value achieved with none of the award being released for synergistic value below £100m and all of the award being released for £150m synergistic
value or more
2 christoph mueller ceased employment with effect from 31 august 2009 due to redundancy under the terms of his departure and in accordance with the scheme rules these awards were released
early subject to proration for time elapsed and performance to cessation of employment
fiveyear long term cash plan
under the fiveyear long term cash bonus agreement between peter long and first choice holidays plc now first choice holidays limited
approved at the 2005 agm of that company peter long is eligible to receive a maximum of £600000 subject to eps growth in excess of rpi
growth the company’s tsr ranking against the constituent companies of the ftse mid250 index excluding investment trusts as calculated 
at the award date and the achievement of personal objectives as determined by the committee over the period to 30 september 2009 a
performance hurdle of the roic being in excess of the wacc must also be achieved for any of the bonus to be payable the amount of bonus
payable is graded according to
• eps growth with 35 of the award being released for 4 per annum in excess of inflation and 35 of the award released for 13 per annum
in excess of inflation
• tsr ranking of the company against the comparator group with 5 of the award being released for median and 50 of the award being
released for upper quartile and
• the remaining 15 of the bonus being payable for the achievement of personal objectives
the roicwacc hurdle was achieved eps growth was greater than 13 per annum in excess of inflation the company tsr ranking was in the
upper quartile and personal objectives were achieved in full therefore all of the award was paid
value of award
director £000
peter long 600
tui travel plc annual report  accounts 2009 61
wwwtuitravelplccom directors’ interests in ordinary shares of the company
as at 30 september 2009 the directors’ interests in ordinary shares of the company were
ordinary shares of 10p each
director’s name title as at 30 september 2009
horst baier nonexecutive director –
dr volker böttcher managing director central europe 37577
paul bowtell chief financial officer 424625

t ony campbell nonexecutive director 43268
clare chapman nonexecutive director 10000
bill dalton nonexecutive director 10000
rainer feuerhake nonexecutive director –
dr michael frenzel nonexecutive chairman –
jeremy hicks nonexecutive director –
sir michael hodgkinson nonexecutive deputy chairman and senior independent director 20000
peter long chief executive 2428235

johan lundgren managing director northern region 27297
dr erhard schipporeit nonexecutive director –
dr albert schunk nonexecutive director –
harold sher nonexecutive director –
giles thorley nonexecutive director 25000
william waggott commercial director 103061

includes shares purchased under the share incentive plan
the company’s register of directors’ interests which is open to inspection at the registered office contains full details of directors’
shareholdings and will be available for inspection before and during the annual general meeting to be held on 9 february 2010
during the year the price of the company’s ordinary shares ranged between 1748p and 27925p and the midclosing price on 30 september
2009 was 2546p
on 1 october 2009 t ony campbell was allocated 504 additional shares in respect of the dividend reinvestment plan
the remuneration report was approved by a duly authorised committee of the board of directors on 30 november 2009 and signed on its
behalf by
clare chapman
chairman of the remuneration committee
30 november 2009
62 tui travel plc annual report  accounts 2009
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governance
remuneration report continued group at a glance strategic overview business performance governance financial statements shareholder information
we have audited the financial statements of tui travel plc for the
year ended 30 september 2009 set out on pages 64 to 127 the
financial reporting framework that has been applied in the preparation
of the tui travel plc group of companies the group financial
statements is applicable law and international financial reporting
standards ifrs as adopted by the eu the financial reporting
framework that has been applied in the preparation of the parent
company financial statements is applicable law and uk accounting
standards uk generally accepted accounting practice
this report is made solely to the company’s members as a body in
accordance with sections 495 496 and 497 of the companies act
2006 our audit work has been undertaken so that we might state 
to the company’s members those matters we are required to state 
to them in an auditors’ report and for no other purpose t o the fullest
extent permitted by law we do not accept or assume responsibility 
to anyone other than the company and the company’s members 
as a body for our audit work for this report or for the opinions we
have formed
respective responsibilities of directors and
auditors
as explained more fully in the directors’ responsibilities statement
set out on page 48 the directors are responsible for the preparation
of the financial statements and for being satisfied that they give a true
and fair view our responsibility is to audit the financial statements in
accordance with applicable law and international standards on auditing
uk and ireland those standards require us to comply with the
auditing practices board’s apb’s ethical standards for auditors
scope of the audit of the financial statements
a description of the scope of an audit of financial statements is
provided on the apb’s website at wwwfrcorgukapbscopeukp
opinion on financial statements
in our opinion
• the financial statements give a true and fair view of the state of 
the group’s and of the parent company’s affairs as at 30 september
2009 and of the group’s loss for the year then ended
• the group financial statements have been properly prepared in
accordance with ifrss as adopted by the eu
• the parent company financial statements have been properly
prepared in accordance with uk generally accepted accounting
practice and
• the financial statements have been prepared in accordance with 
the requirements of the companies act 2006 and as regards the
group financial statements article 4 of the ias regulation
opinion on other matters prescribed by the
companies act 2006
in our opinion
• the part of the directors’ remuneration report to be audited has
been properly prepared in accordance with the companies act
2006 and
• the information given in the directors’ report for the financial year
for which the financial statements are prepared is consistent with
the financial statements
matters on which we are required to report 
by exception
we have nothing to report in respect of the following
under the companies act 2006 we are required to report to you if 
in our opinion
• adequate accounting records have not been kept by the parent
company or returns adequate for our audit have not been received
from branches not visited by us or
• the parent company financial statements and the part of the
remuneration report to be audited are not in agreement with the
accounting records and returns or
• certain disclosures of directors’ remuneration specified by law are
not made or
• we have not received all the information and explanations we
require for our audit
under the listing rules we are required to review
• the directors’ report set out on page 47 in relation to going
concern and
• the part of the corporate governance report relating to the
company’s compliance with the nine provisions of the june 2008
combined code specified for our review
oliver tant
senior statutory auditor for and on behalf of
kpmg audit plc statutory auditor
chartered accountants
8 salisbury square
london
ec4y 8bb
30 november 2009
independent auditor’s report to the members of tui t ravel plc
tui travel plc annual report  accounts 2009 63
wwwtuitravelplccom 64 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
financial statements
consolidated income statement
for the year ended 30 september 2009
year ended year ended
30 september 30 september
2009 2008
note £m £m
continuing operations
revenue 2 13863 13932
cost of sales 12705 12911
gross profit 1158 1021
administrative expenses 1130 1217
share of profit of joint ventures and associates 12 9 12
operating profitloss 37 184
analysed as
underlying operating profit 1 2 443 398
separately disclosed items 3 340 380
amortisation of business combination intangibles 10 56 87
impairment of goodwill 10 7 112
t axation on profits of joint ventures and associates 12 3 3
37 184
financial income 4 72 122
financial expenses 4 161 205
net financial expenses 4 89 83
loss before tax 52 267
t axation 7 42 –
loss for the year from continuing operations 10 267
discontinued operation
loss from discontinued operation 8 14 –
loss for the year 24 267
attributable to
equity holders of the parent 25 271
minority interest 1 4
loss for the year 24 267
pence pence
basic and diluted loss per share pence for loss attributable 
to the equity holders of the company during the year
– basic and diluted from continuing operations 33 10 244
– basic and diluted from discontinued operation 33 13 –
nongaap measures
reconciliation of underlying operating profit to underlying profit before tax
£m £m
underlying operating profit 1 2 443 398
net underlying financial expenses 4 77 79
underlying profit before tax 366 319
pence pence
underlying earnings per share pence for profit attributable 
to the equity holders of the company during the year
– basic 33 238 204
– diluted 33 235 202 group at a glance strategic overview business performance governance financial statements shareholder information
30 september 30 september
2009 2008
note £m £m
noncurrent assets
intangible assets 10 4737 4429
property plant and equipment 11 964 926
investments in joint ventures and associates 12 112 114
other investments 12 77 56
trade and other receivables 16 194 210
retirement benefit asset 5c 1 17
derivative financial instruments 25i 13 48
deferred tax assets 14 211 205
6309 6005
current assets
inventories 15 51 51
other investments 17 36 29
trade and other receivables 16 1536 1653
income tax recoverable 30 29
derivative financial instruments 25i 271 273
cash and cash equivalents 17 790 1130
assets classified as held for sale 18 126 157
2840 3322
total assets 9149 9327
current liabilities
interestbearing loans and borrowings 19 327 99
retirement benefits 5c 3 2
derivative financial instruments 25i 284 178
trade and other payables 20 4162 4057
provisions 21 189 235
income tax payable 67 89
liabilities classified as held for sale 18 59 22
5091 4682
noncurrent liabilities
interestbearing loans and borrowings 19 801 1167
retirement benefits 5c 498 268
derivative financial instruments 25i 18 50
trade and other payables 22 108 149
provisions 21 250 180
deferred tax liabilities 14 97 235
1772 2049
total liabilities 6863 6731
net assets 2286 2596
equity
share capital 23 112 112
other reserves 24 2775 2749
retained deficit 24 604 270
total equity attributable to equity holders of the parent 24 2283 2591
minority interest 24 3 5
total equity 24 2286 2596
the financial statements were approved by a duly authorised committee of the board of directors on 30 november 2009 and signed on its
behalf by
paul bowtell
chief financial officer
tui travel plc annual report  accounts 2009 65
wwwtuitravelplccom
consolidated balance sheet
at 30 september 2009 year ended year ended
30 september 30 september
2009 2008
note £m £m
loss for the year 24 267
adjustment for
depreciation and amortisation 10 11 287 331
impairment of intangible assets and property plant and equipment 10 11 132 145
equitysettled sharebased payment expenses 5d 16 14
profitloss on sale of property plant and equipment 6 12 71
share of profit of joint ventures and associates 12 9 12
gainloss on foreign exchange 6 23 26
dividends received from joint ventures and associates 12 10 9
financial income 4 72 122
financial expenses 4 161 205
loss from discontinued operation 8 14 –
t axation 7 42 –
operating profit before changes in working capital and provisions 438 400
increase in inventories 2 5
decreaseincrease in trade and other receivables 93 235
decreaseincrease in trade and other payables 183 265
decreaseincrease in provisions and employee benefits 23 42
cash flows from operations 323 467
interest paid 68 109
interest received 6 53
income taxes paid 43 33
cash flows from operating activities 218 378
investing activities
proceeds from sale of property plant and equipment 161 347
proceeds from disposal of subsidiaries net of cash disposed of – 2
acquisition of subsidiaries net of cash acquired 13b 48 90
acquisition of minority shareholdings 3 20
investment in joint ventures associates and other investments 51 9
acquisition of property plant and equipment and software 234 277
cash flows from investing activities 175 47
financing activities
proceeds from new loans and deposits taken 17 232
repayment of borrowings 280 1411
repayment of finance lease liabilities 22 26
ordinary and minority interest dividends paid 24 110 70
acquisition of shares for sharebased payments 24 – 7
cash flows from financing activities 395 1282
net decrease in cash and cash equivalents 352 951
cash and cash equivalents at start of the year 17 1130 1959
reclassification of cash to assets classified as held for sale 4 –
effect of foreign exchange on cash held 16 122
cash and cash equivalents at end of the year 17 790 1130
movements in cash and net debt are presented in note 26
in accordance with ias 7 cash flow statements the acquisition of shares for sharebased payments has been restated in the comparative year 
to be presented as a financing activity rather than an operating activity
66 tui travel plc annual report  accounts 2009
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financial statements
consolidated statement of cash flows
for the year ended 30 september 2009 group at a glance strategic overview business performance governance financial statements shareholder information
year ended year ended
30 september 30 september
2009 2008
note £m £m
foreign exchange translation 25j 129 180
actuarial lossesgains arising in respect of defined benefit pension schemes 5c 271 4
cash flow hedges
– movement in fair value 25j 60 163
– amounts recycled to the income statement 25j 81 37
changes in the fair value of available for sale financial asset 12 1 –
t ax on items taken directly to equity 7 105 62
net lossincome recognised directly in equity 179 322
loss for the year 24 267
total recognised expenseincome for the year 203 55
attributable to
equity holders of the parent 205 50
minority interest 2 5
total 203 55
tui travel plc annual report  accounts 2009 67
wwwtuitravelplccom
consolidated statement of recognised income and expense
for the year ended 30 september 2009 1 accounting policies
the following accounting policies have been applied consistently to all
years presented in these consolidated financial statements
the consolidated financial statements are presented in the group’s
presentational currency of sterling rounded to the nearest million
a statement of compliance
the consolidated financial statements for the year ended 
30 september 2009 have been prepared and approved by the
directors in accordance with international financial reporting
standards as adopted by the european union adopted ifrss 
the consolidated financial statements were approved on 
30 november 2009
b basis of preparation
i parent company
tui travel plc the company is a company incorporated and
domiciled in england and wales under the companies act 1985 and
listed on the london stock exchange the registered office of the
company is tui travel house crawley business quarter fleming way
crawley west sussex rh10 9ql
the company has elected to prepare its parent company financial
statements in accordance with uk gaap
ii underlying measures of profits and losses
the group believes that underlying operating profit underlying profit
before tax and underlying earnings per share provide additional
guidance to statutory measures to help understand the underlying
performance of the business during the financial year the term
underlying is not defined under international financial reporting
standards it is a measure that is used by management to assess the
underlying performance of the business internally and is not intended
to be a substitute measure for adopted ifrss’ gaap measures the
group defines these underlying measures as follows
underlying operating profit is operating profit or loss from continuing
operations stated before separately disclosed items note 3
amortisation of intangible assets acquired in business combinations
impairment of goodwill and taxation on the group’s share of the
results of joint ventures and associates
underlying profit before tax is profit or loss from continuing
operations before taxation group and share of joint ventures and
associates amortisation of intangible assets acquired in business
combinations impairment of goodwill and separately disclosed items
included within both the operating result note 3 and net financial
expenses note 4
underlying earnings used in the calculation of underlying earnings 
per share is profit after tax from continuing operations excluding
amortisation of intangible assets acquired in business combinations
impairment of goodwill and separately disclosed items included within
both the operating result note 3 and net financial expenses note 4
net of related taxation
it should be noted that the definitions of underlying items being used
in these consolidated financial statements are those used by the
group and may not be comparable with the term ‘underlying’ as
defined by other companies within both the same sector or elsewhere
iii separately disclosed items
separately disclosed items are those significant items which in
management’s judgement are highlighted by virtue of their size or
incidence to enable a full understanding of the group’s financial
performance such items are included within the income statement
caption to which they relate notes 3 and 4
iv business performance review
the group’s business activities together with factors likely to affect 
its future development performance and position are set out in the
business performance review in addition note 25 sets out the
group’s objectives policies and processes for managing its capital
financial risks financial instruments and hedging activities as well as 
its exposures to credit and liquidity risk
v funding and liquidity
the board remains satisfied with the group’s funding and liquidity
position the two main sources of debt funding are the shareholder
loan from tui ag which is €919m and is being repaid in instalments
over the period to april 2011 and the £910m of syndicated bank
revolving credit facility which matures in june 2012 on 25 september
2009 the group also agreed an annually renewable £40m bonding and
letter of credit facility in addition on 1 october 2009 the group
offered £350m of senior unsecured convertible bonds due 2014 the
coupon has been set at 60 per annum and the conversion price has
been set at 3493p per share which represents a premium of 330
over the volume weighted average price of tui travel plc’s ordinary
shares from launch to pricing settlement occurred on 5 october 2009
the ratio of earnings before interest t axation depreciation
amortisation and operating lease rentals ebitdar to fixed charges
being the aggregate amount of interest and any other finance charges
in respect of borrowings and including all payments under operating
leases and the ratio of net debt to ebitda which the board believes
to be the most useful measures of cash generation and gearing as
well as being the main basis for the group’s credit facility covenants
are currently well within the covenant limits forecasts reviewed by the
board including forecasts adjusted for significantly worse economic
conditions show continued compliance with these covenants ebitda
is earnings before interest t axation depreciation and amortisation
for both covenants earnings are calculated on an underlying basis as
described in note 1bii
on the basis of its forecasts both base case and adjusted as
described above and available facilities the board has concluded that
the going concern basis of preparation continues to be appropriate
c basis of consolidation
the consolidated financial statements are prepared on the historical
cost basis other than derivative financial instruments financial
instruments held for trading financial instruments classified as
available for sale and liabilities for cashsettled sharebased payments
which are stated at their fair value noncurrent assets and disposal
groups held for sale are stated at the lower of their carrying amount
and fair value less costs to sell
the group financial statements consolidate those of the company
and its subsidiaries together referred to as the group and equity
account the group’s interest in joint ventures and associates the
parent company financial statements present information about the
company as a separate entity and not about the group
i subsidiaries
subsidiaries are entities controlled by the group control exists when
the group has the power directly or indirectly to govern the financial
and operating policies of an entity so as to obtain benefits from its
activities in assessing control potential voting rights that are currently
exercisable or convertible are taken into account the financial
statements of subsidiaries are included in the consolidated financial
information from the date that control commences until the date that
control ceases
financial statements
notes to the consolidated financial statements
68 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
ii joint ventures and associates
joint ventures are jointly controlled entities whose activities the group
has the power to jointly control established by contractual agreement
associates are those entities in which the group has the ability to
exercise significant influence but not control over the financial and
operating policies the consolidated financial statements include the
group’s share of the total recognised income and expense of joint
ventures and associates on an equity accounted basis from the date
that joint control or significant influence respectively commences until
the date that it ceases associates and joint ventures are recorded 
at cost as adjusted for postacquisition changes in the group’s share 
of net assets of the entity including goodwill net of accumulated
impairment loss when the group’s share of losses exceeds the
carrying amount of the joint venture or associate the carrying 
amount is reduced to nil and recognition of further losses is
discontinued except to the extent that the group has incurred legal 
or constructive obligations or made payments on behalf of the joint
venture or associate
iii transactions eliminated on consolidation
intragroup balances and any unrealised gains or income and expenses
arising from intragroup transactions are eliminated in preparing the
consolidated financial statements unrealised gains arising from
transactions with associates and jointly controlled entities are eliminated
to the extent of the group’s interest in the entity unrealised losses
are eliminated in the same way as unrealised gains but only to the
extent that there is no evidence of impairment
iv acquisition in stages
when control is obtained in successive share purchases a ‘step
acquisition’ each significant transaction is accounted for separately
and the identifiable assets liabilities and contingent liabilities acquired
are stated at fair value when control is obtained the fair value of the
acquiree’s identifiable assets liabilities and contingent liabilities may 
be different at the date of each purchase transaction any adjustment
to those fair values relating to previously held interests of the acquirer
is accounted for as a revaluation
v contingent acquisition consideration
contingent consideration is recognised when the payment amount
becomes probable and the amount can be reliably measured the
purchase price is subsequently adjusted against goodwill or negative
goodwill as the estimate of the amount payable is revised
vi noncurrent assets held for sale
the group classifies noncurrent assets as held for sale if their carrying
amount will be recovered principally through a sale transaction rather
than through continuing use t o be classified as held for sale the
assets must be available for immediate sale in their present condition
subject only to terms that are usual and customary for the sale of such
assets and their sale must be highly probable sale is considered to be
highly probable when management are committed to a plan to sell the
assets and an active programme to locate a buyer and complete the
plan has been initiated at a price that is reasonable in relation to their
current fair value and there is an expectation that the sale will be
completed within one year from the date of classification noncurrent
assets classified as held for sale are carried on the group’s balance
sheet at the lower of their carrying amount and fair value less costs 
to sell
d foreign currency
i foreign currency transactions
transactions in foreign currencies are translated at the foreign
exchange rate ruling at the date of the transaction monetary assets
and liabilities denominated in foreign currencies at the balance sheet
date are translated to sterling at the foreign exchange rate ruling at
that date foreign exchange differences arising on translation are
recognised in the income statement except for differences arising on
the retranslation of a financial liability designated as a hedge of the
net investment in a foreign operation or qualifying cash flow hedges
which are recognised directly in equity nonmonetary assets and
liabilities that are measured in terms of historical cost in a foreign
currency are translated using the exchange rate at the date of the
transaction nonmonetary assets and liabilities denominated in
foreign currencies that are stated at fair value are translated to 
sterling at foreign exchange rates ruling at the dates the fair values
were determined
ii foreign operations
the assets and liabilities of foreign operations including goodwill 
and fair value adjustments arising on consolidation are translated to
sterling at the foreign exchange rates ruling at the balance sheet date
the revenues and expenses of overseas operations are translated 
at rates approximating to the foreign exchange rates ruling at the
dates of the transactions foreign exchange differences arising on
retranslation have been recognised directly in equity in the translation
reserve a designated foreign exchange reserve since 1 january 2007
foreign exchange gains and losses arising from a monetary item
receivable from or payable to a foreign operation the settlement 
of which is neither planned nor likely in the foreseeable future are
considered to form part of a net investment in a foreign operation 
and are recognised directly in equity in the translation reserve
iii net investment in foreign operations
the group applies hedge accounting to foreign currency differences
arising between the functional currency of the foreign operation and
the parent entity’s functional currency sterling regardless of whether
the net investment is held directly or through an intermediate parent
foreign currency differences arising on the retranslation of a financial
liability designated as a hedge of a net investment in a foreign
operation are recognised in the consolidated statement of recognised
income and expense to the extent that the hedge is effective and are
presented within equity in the translation reserve t o the extent that
the hedge is ineffective such differences are recognised in profit or
loss when the hedged part of a net investment is disposed of the
relevant amount in the translation reserve is transferred to profit or
loss as part of the profit or loss on disposal
e financial instruments
i financial assets
financial assets are either classified as loans and receivables available
for sale financial assets or financial assets at fair value through profit
or loss financial assets include cash and cash equivalents trade
receivables other receivables loans other investments and derivative
financial instruments the group determines the classification of its
financial assets at initial recognition financial assets are recognised
initially at fair value normally being the transaction price plus in the
case of financial assets not at fair value through profit or loss directly
attributable transaction costs the subsequent measurement of
financial assets depends on their classification as follows
tui travel plc annual report  accounts 2009 69
wwwtuitravelplccom loans and receivables
loans and receivables are nonderivative financial assets with fixed 
or determinable payments that are not quoted in an active market
such assets are carried at amortised cost using the effective interest
method if the time value of money is significant gains and losses are
recognised in income when the loans and receivables are derecognised
or impaired as well as through the amortisation process this category
of financial assets includes trade and other receivables
available for sale financial assets
available for sale financial assets are those nonderivative financial
assets that are not classified as loans and receivables or financial
assets at fair value through profit or loss after initial recognition
available for sale financial assets are measured at fair value with gains
or losses recognised as a separate component of equity until the
investment is derecognised or until the investment is determined to
be impaired at which time the cumulative gain or loss previously
reported in equity is included in the consolidated income statement
note 1yiv describes the basis on which fair value is determined
cash and cash equivalents
cash and cash equivalents comprise cash balances and call deposits
bank overdrafts that are repayable on demand and form an integral
part of the group’s cash management are included as a component 
of cash and cash equivalents for the purpose only of the consolidated
statement of cash flows
derivatives
derivatives are accounted for in accordance with the policy in 1eiii
derecognition
the group derecognises a financial asset when the contractual rights
to the cash flows from the asset expire or it transfers the rights to
receive the contractual cash flows on the financial asset in a transaction
in which substantially all the risks and rewards of ownership of the
financial asset are transferred any interest in transferred financial
assets that is created or retained by the group is recognised as a
separate asset or liability
ii financial liabilities
financial liabilities are either classified as financial liabilities measured
at amortised cost or financial liabilities at fair value through profit or
loss financial liabilities include trade and other payables accruals
finance debt and derivative financial instruments the group determines
the classification of its financial liabilities at initial recognition financial
liabilities are recognised initially at fair value normally being the
transaction price plus in the case of financial liabilities not at fair value
through profit or loss directly attributable transaction costs the
subsequent measurement of financial liabilities depends on their
classification as follows
financial liabilities measured at amortised cost
all financial liabilities are initially recognised at fair value for interest
bearing loans and borrowings this is the fair value of the proceeds
received net of issue costs associated with the borrowing after initial
recognition financial liabilities other than those at fair value through
profit or loss are subsequently measured at amortised cost using the
effective interest method amortised cost is calculated by taking into
account any issue costs and any discount or premium on settlement
gains and losses arising on the repurchase settlement or cancellation
of liabilities are recognised respectively in interest and other revenues
and finance costs this category of financial liabilities includes trade
and other payables
derivatives
derivatives are accounted for in accordance with the policy in 1eiii
derecognition
the group derecognises a financial liability when the contractual
obligations to pay the contractual cash flows on the financial liability
are discharged cancelled or expire
iii derivative financial instruments
the group uses derivative financial instruments to hedge its exposure
to foreign exchange interest rate and fuel price risks arising from
operational financing and investment activities in accordance with its
treasury policy the group does not hold or issue derivative financial
instruments for trading purposes however derivatives that do not
qualify for hedge accounting are accounted for as trading instruments
derivative financial instruments are initially recognised at fair value on
the date a derivative contract is entered into and are subsequently
remeasured at fair value the method of recognising the resulting gain
or loss depends on whether the derivative is designated as a hedging
instrument and if so the nature of the item being hedged the gain 
or loss on remeasurement to fair value on derivatives not designated
as a hedging instrument is recognised immediately in the consolidated
income statement where derivatives qualify for hedge accounting see
accounting policy 1f
iv share capital
ordinary shares are classified as equity incremental costs directly
attributable to the issue of ordinary shares and share awards are
recognised as a deduction from equity net of any tax effects
f hedge accounting
the group designates certain derivatives as either hedges of a
particular risk associated with a recognised asset or liability or a highly
probable forecast transaction cash flow hedge or a hedge of the 
fair value of recognised assets or liabilities or a firm commitment 
fair value hedge
on initial designation of the hedge the group formally documents the
relationship between the hedging instruments and hedged items
including the risk management objectives and strategy in undertaking
the hedge transaction together with the methods that will be used to
assess the effectiveness of the hedging relationship the group makes
an assessment both at the inception of the hedge relationship as well
as on an ongoing basis whether the hedging instruments are expected
to be ‘highly effective’ in offsetting the changes in the fair value or
cash flows of the respective hedged items during the period for which
the hedge is designated and whether the actual results of each hedge
are within a range of 80125 for a cash flow hedge of a forecast
transaction the transaction should be highly probable to occur and
should present an exposure to variations in cash flows that could
ultimately affect reported net income
derivatives are recognised initially at fair value attributable transaction
costs are recognised in profit or loss as incurred subsequent to initial
recognition derivatives are measured at fair value and changes therein
are accounted for as described below
financial statements
notes to the consolidated financial statements continued
70 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
i cash flow hedges
where a derivative financial instrument is designated as a hedge of
the variability in cash flows arising from a recognised asset or liability
or a highly probable forecast transaction the effective part of any fair
value gain or loss on the derivative financial instrument is recognised
directly in the hedging reserve any ineffective portion of the hedge 
is recognised immediately within the consolidated income statement
when the forecast transaction subsequently results in the recognition
of a nonfinancial asset or nonfinancial liability the associated
cumulative gain or loss is removed from the hedging reserve and is
included in the initial cost or other carrying amount of the non
financial asset or liability if a hedge of a forecast transaction
subsequently results in the recognition of a financial asset or a
financial liability the associated gains and losses that were recognised
directly in equity are reclassified into the consolidated income
statement in the same period or periods during which the asset
acquired or liability assumed affects profit or loss
for cash flow hedges other than those covered by the preceding two
paragraphs the associated cumulative gain or loss is removed from
equity and recognised in the consolidated income statement in the
same period or periods during which the hedged forecast transaction
affects the consolidated income statement
prospective hedge testing is performed at the inception of the hedge
relationship and subsequently at each balance sheet date through
comparison of the critical terms of the hedged forecast transaction
and the hedging instrument critical terms are the maturity amount
and currency of the cash flows relating to the hedging instrument 
and the forecast hedged transaction retrospective hedge testing is
performed at each reporting date principally using a dollar offset
analysis comparing the cumulative changes in the fair values of the
forecast hedged transaction and the hedging instrument
when a hedging instrument no longer meets the criteria for hedge
accounting expires or is sold terminated or exercised or the entity
revokes designation of the hedge relationship hedge accounting is
discontinued prospectively if the hedged forecast transaction is still
expected to occur the cumulative gain or loss at that point remains in
equity and is recognised in accordance with the above policy when the
transaction occurs if the hedged transaction is no longer expected to
take place the cumulative unrealised gain or loss recognised in equity
is recognised in the consolidated income statement immediately
ii fair value hedges
where a derivative financial instrument is designated as a hedge 
of the variability in fair value of a recognised asset or liability or an
unrecognised firm commitment all changes in the fair value of the
derivative are recognised immediately in the income statement 
the carrying value of the hedged item is adjusted by the change 
in fair value that is attributable to the risk being hedged even if it 
is normally carried at cost or amortised cost and any fair value gains
or losses on remeasurement of the hedged risk are recognised
immediately in the income statement even if those gains would
normally be recognised directly in equity
g revenue
revenue represents the aggregate amount earned from inclusive
tours scheduled and charter flying provision of incoming agency
destination services travel agency commission received and other
services supplied to customers in the ordinary course of business
revenue excludes intragroup transactions and is stated after the
deduction of trade discounts and sales taxes revenue is reported
gross of fixed charges which are a liability of the tour operator or
airline these include air passenger duty and other per passenger
charges and levies including the atol protection contribution in 
the uk
i revenue recognition
revenue is recognised in the income statement when the significant
risks and rewards of ownership have been transferred to the buyer
travel agency commissions and other revenues received from the sale
of third party product are recognised when they are earned typically
on receipt of final payment revenue in respect of inhouse product is
all recognised on the date of departure revenue from individual travel
modules directly booked by the customer with airlines hotels and
incoming agencies is recognised when the customer departs or uses
the respective service
no revenue is recognised if there are significant uncertainties
regarding recovery of the consideration due associated costs or
possible return of goods
ii client monies received in advance deferred income
client monies received at the balance sheet date relating to holidays
commencing and flights departing after the year end is deferred and
included within trade and other payables
iii valuation of revenue
where the group acts as principal revenue is stated at the contractual
value of goods and services provided
where the group acts as agent and collects amounts on behalf of the
principal provider of goods or services revenue is stated at the value
of the commissions earned and not the total transaction sales value
where the group acts as intermediary between the service provider
and the end customer revenue is presented on a net basis as the
difference between the sales price to the customer and the cost of 
the services purchased businesses are identified as intermediaries
dependent on a number of criteria principally including the control
exercised over the provision of service inventory risk and customer
credit risk
iv aircraft lease income
operating lease rental incomes are recognised in operating income 
as earned on a straightline basis over the lease term
h expenses
i operating lease payments
payments made under operating leases are recognised in the income
statement on a straightline basis over the term of the lease lease
incentives received are recognised in the income statement as an
integral part of the total lease expense over the term of the lease
tui travel plc annual report  accounts 2009 71
wwwtuitravelplccom ii finance lease payments
minimum lease payments are apportioned between the finance 
charge and the reduction of the outstanding liability the finance
charge is allocated to each period during the lease term so as to
produce a constant periodic rate of interest on the remaining balance
of the liability
iii marketing and other direct sales costs
marketing advertising and other promotional costs including those
related to the production of brochures are expensed when the benefit
of the goods or services is made available to the group in particular
brochure costs are expensed when the group has access to the
related advertising or promotional material
i employee benefits
i defined contribution plans
obligations for contributions to defined contribution pension plans are
recognised as an expense in the income statement as incurred
ii defined benefit plans
the group’s net obligation in respect of defined benefit pension plans
is calculated separately for each plan by estimating the amount of
future benefit that employees have earned in return for their service 
in current and prior periods that benefit is discounted to determine
its present value and any unrecognised past service costs and the fair
value of any plan assets is deducted in calculating the overall liability
the liability discount rate is the yield at the balance sheet date on aa
creditrated bonds denominated in the currency of and having the
same maturity dates approximating to the terms of the group’s
obligations the calculation is performed by a qualified actuary using
the projected unit credit method
where the calculation results in a benefit to the group the asset
recognised is limited to the present value of any future refunds from
the plan or reductions in future contributions to the plan which are
under the control of the group
when the benefits of a plan are improved the portion of the
increased benefit relating to past services by employees is recognised
as an expense in the income statement on a straightline basis over the
average period until the benefits become vested t o the extent that
the benefits vest immediately the expense is recognised immediately
in the income statement
all actuarial gains and losses are recognised in the period they occur
directly in equity through the consolidated statement of recognised
income and expense either monthly or annual contributions are made
to funded schemes
iii sharebased payment transactions
the group’s share award programmes allow certain group employees
to acquire shares of the company these shares are awarded by the
company for equitysettled transactions the fair value of services is
measured by the fair value of the shares at the time awarded and is
recognised as an employee expense with a corresponding increase 
in equity the fair value is spread over the period during which the
employee becomes entitled to the awards
the fair value of the awards is measured using option valuation
models taking into account the terms and conditions upon which the
awards were made the amount recognised as an expense is adjusted
to reflect the actual number of share awards that vest except where
forfeiture is due only to marketbased performance conditions not
meeting the threshold for vesting
for cashsettled transactions the resulting liability for the group is
charged to expenses at its fair value as at the date of the performance
of the service by the beneficiary until payment of this liability the fair
value of the liability is remeasured at every reporting date and all
changes in the fair value are carried with an effect on results
iv own shares held by the employee benefit trust
transactions of the groupsponsored employee benefit trust are
included in the group’s consolidated financial statements in particular
the trust’s purchase of shares in the company is debited directly in
equity to retained earnings
v short term benefits
short term employee benefits are measured on an undiscounted basis
and are expensed as the related service is provided
j financial income and expenses
financial income comprises interest income on funds invested
including available for sale financial assets dividend income gains 
on the disposal of available for sale financial assets and changes in the
fair value of financial assets or liabilities at fair value through profit or
loss interest income is recognised as it accrues in profit or loss using
the effective interest method dividend income is recognised in profit
or loss on the date that the group’s right to receive payment is
established which in the case of quoted securities is the exdividend
date foreign currency gains and losses are reported on a net basis
financial expenses comprise interest expense on borrowings
unwinding of the discount on provisions changes in the fair value of
financial assets or liabilities at fair value through profit or loss and
impairment losses recognised on financial assets all borrowing costs
are recognised in profit or loss using the effective interest method
foreign currency gains and losses are reported on a net basis
k taxation
income tax comprises current and deferred tax income tax is
recognised in the consolidated income statement except to the extent
that it relates to items recognised directly in equity in which case it is
recognised in equity
i current tax
current tax is the expected tax payable on the taxable income for 
the period using tax rates enacted or substantively enacted at the
balance sheet date and any adjustment to tax payable in respect of
previous periods
ii deferred tax
deferred tax is provided or recognised using the balance sheet liability
method providing for temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and
the amounts used for taxation purposes the following temporary
differences are not provided for the initial recognition of goodwill 
not deductible for tax purposes the initial recognition of assets or
liabilities in a transaction that is not a business combination and
differences relating to investments in subsidiaries to the extent that
they will probably not reverse in the foreseeable future the amount 
of deferred tax asset recognised is based on the expected manner of
realisation or settlement of the carrying amount of assets and liabilities
using the tax rate at which the asset or liability is expected to reverse
in future periods based on tax laws enacted or substantively enacted
at the balance sheet date
financial statements
notes to the consolidated financial statements continued
72 tui travel plc annual report  accounts 2009
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a deferred tax asset is recognised only to the extent that it is probable
that future taxable profits will be available against which the asset can
be utilised deferred tax assets are reduced to the extent that it is no
longer probable that the related tax benefit will be realised
l dividends
dividend distribution to the company’s shareholders is recognised as
a liability in the group’s financial statements in the period in which the
dividends are appropriately authorised and approved for payment and
are no longer at the discretion of the company unpaid dividends that
do not meet these criteria are disclosed in the notes to the financial
statements
m earnings per share
the group presents basic and diluted earnings per share eps data
for its ordinary shares basic eps is calculated by dividing the profit 
or loss attributable to ordinary shareholders of the company by the
weighted average number of ordinary shares outstanding during the
period diluted eps is determined by adjusting the weighted average
number of ordinary shares outstanding for the effects of all dilutive
potential ordinary shares eps measures for both continuing and
discontinued operations have been presented in accordance with 
ias 33 the group also presents a basic and diluted underlying eps
measure based on underlying earnings as defined in note 1bii
above further details of the eps calculation are presented in note 33
n noncurrent assets held for sale
ifrs 5 requires that a noncurrent asset or a disposal group
containing a noncurrent asset is classified as held for sale if its
carrying amount will be recovered principally through sale rather than
through continuing use it is available for immediate sale and sale is
highly probable within one year
on initial classification as held for sale noncurrent assets and
disposal groups are measured at the lower of previous carrying
amount and fair value less costs to sell with any adjustments taken to
profit or loss the same applies to gains and losses on subsequent
remeasurement
any impairment loss on a disposal group is allocated first to goodwill
and then to remaining applicable assets on a pro rata basis except no
loss is allocated to inventories financial assets deferred tax assets or
employee benefit assets which continue to be measured in
accordance with the group’s accounting policies
certain assetsliabilities are excluded from the measurement basis of
ifrs 5 including deferred tax assets ias 12 income t axes assets
arising from employee benefits ias 19 employee benefits and
financial assets within the scope of ias 39 financial instruments
recognition and measurement
o investments
trade investments are classified as available for sale assets and are
included under noncurrent assets they are recorded at fair value with
movements in value taken to equity any impairment to value is
recorded in the income statement
short term investments in debt and equity securities which are held
for trading are classified as current assets and are stated at fair value
with any resultant gain or loss recognised in the income statement
p intangible assets
i goodwill
all business combinations are accounted for by applying the 
purchase method
goodwill represents amounts arising on acquisition of subsidiaries
jointly controlled entities and associates goodwill represents the
difference between the fair value of consideration paid or payable and
the net fair value of the identifiable assets liabilities and contingent
liabilities acquired identifiable intangibles are those which can be sold
separately or which arise from legal rights regardless of whether those
rights are separable goodwill is stated at cost less any accumulated
impairment losses goodwill is allocated to those cash generating 
units expected to benefit from the business combination and is not
amortised but tested annually for impairment impairment testing is
based on assets grouped at the lowest level at which goodwill is
monitored for internal management purposes in respect of joint
ventures and associates the carrying amount of goodwill is included in
the carrying amount of the investment in the joint venture or associate
fair value adjustments are made in respect of acquisitions if at the
balance sheet date the amounts of fair values of the acquiree’s
identifiable assets and liabilities can only be established provisionally
then these values are used any adjustments to these values are taken
as adjustments to goodwill and must be recorded within 12 months of
the acquisition
negative goodwill arising on an acquisition is recognised in the income
statement upon acquisition
ii computer software and other intangible assets
computer software consists of all software that is not an integral part of
the related computer hardware and is stated at cost less accumulated
amortisation and impairment losses
iii amortisation
amortisation is charged to the income statement on a straightline
basis over the estimated useful economic life of each type of
intangible asset as follows
computer software 3 – 10 years
brands 15 – 20 years
order book at date of acquisition over the period until travel occurs
customer relationships over the period during which value will be
obtained by the group up to 15 years
goodwill is not amortised but is tested annually for impairment
q property plant and equipment
i owned assets
items of property plant and equipment are stated at cost less
accumulated depreciation and impairment losses
where significant parts of an item of property plant and equipment
have different useful lives they are accounted for as separate items 
of property plant and equipment
ii leased assets
leases in which the group assumes substantially all the risks and
rewards of ownership are classified as finance leases leased assets
acquired by way of a finance lease are stated at an amount equal to
the lower of their fair value and the present value of the minimum
lease payments at the inception of the lease less accumulated
depreciation and impairment losses lease payments are accounted
for as set out in note 1h above
tui travel plc annual report  accounts 2009 73
wwwtuitravelplccom iii depreciation
depreciation is charged to the income statement on a straightline
basis over the estimated useful economic lives of each part of an item
of property plant and equipment freehold land is not depreciated
the useful economic lives are as follows
freehold properties up to 50 years
short leasehold improvements lease period or useful economic 
life if shorter
owned aircraft up to 18 years
finance leased aircraft 
and equipment lease period or useful economic 
life if shorter
aircraft spares 12 years
cruise ships 20 years
yachts 515 years
motor boats 1524 years
computer equipment including
retail computer equipment 35 years
retail fixtures and fittings 8 years
other assets 4 years
the cost of major overhauls of owned airframes and engines is
capitalised and depreciated over the period until the next scheduled
major overhaul
the depreciation methods useful economic lives and residual values
are reassessed annually revisions to useful economic lives and residual
values are accounted for prospectively from the date of change
assets under construction are not depreciated
iv borrowing costs
in respect of borrowing costs relating to qualifying assets the group
capitalises borrowing costs directly attributable to the acquisition
construction or production of a qualifying asset as part of the cost 
of that asset
the group has capitalised borrowing costs with respect to predelivery
payments relating to aircraft
v sale and leaseback transactions
when a sale and leaseback results in a finance lease any gain on the
sale is deferred and recognised as income over the lease term any
loss on the sale is immediately recognised as an impairment loss when
the sale occurs
if the leaseback is classified as an operating lease then any gain is
recognised immediately if the sale and leaseback terms are
demonstrably at fair value otherwise the sale and leaseback are
accounted for as follows
if the sale price is below fair value then the gain or loss is recognised
immediately other than to the extent that a loss is compensated for 
by future rentals at a belowmarket price then the loss is deferred
and amortised over the period that the asset is expected to be used
if the sale price is above fair value then any gain is deferred and
amortised over the useful life of the asset
if the fair value of the asset is less than the carrying amount of the
asset at the date of the transaction then that difference is recognised
immediately as a loss on the sale
r impairments
i financial assets
a financial asset is assessed at each reporting date to determine
whether there is any objective evidence that it is impaired a financial
asset is considered to be impaired if objective evidence indicates that
one or more events have had a negative effect on the estimated
future cash flows of that asset
an impairment loss in respect of a financial asset is calculated as the
difference between its carrying amount and its recoverable amount
an impairment loss in respect of an available for sale financial asset is
calculated by reference to its fair value the recoverable amount of the
group’s receivables which are carried at amortised cost is calculated as
the present value of estimated future cash flows discounted at the
original effective interest rate ie the effective interest rate computed
at initial recognition of these financial assets receivables with a short
duration are not discounted
individually significant financial assets are tested for impairment on an
individual basis the remaining financial assets are assessed collectively
in groups that share similar credit risk characteristics
all impairment losses are recognised in profit or loss any cumulative
loss in respect of an available for sale financial asset previously
recognised in equity is transferred to profit or loss an impairment 
loss is reversed if the reversal can be related objectively to an event
occurring after the impairment loss was recognised for financial
assets measured at amortised cost and available for sale financial
assets that are debt securities the reversal is recognised in profit or
loss for available for sale financial assets that are equity securities 
the reversal is recognised directly in equity
ii nonfinancial assets
the carrying amount of the group’s nonfinancial assets other than
inventory and deferred tax assets are reviewed at each balance sheet
date to determine whether there is any indication of impairment if
such an indication exists the asset’s recoverable amount is estimated
for goodwill the recoverable amount is estimated at each balance
sheet date
an impairment loss is recognised whenever the carrying amount of an
asset or its cash generating unit exceeds its recoverable amount the
recoverable amount of an asset or cash generating unit is the greater
of its value in use and fair value less costs to sell in assessing value in
use the estimated future cash flows are discounted to their present
value using a pretax discount rate that reflects current market
assessments of the time value of money and the risks specific to the
asset a cash generating unit is the smallest identifiable group of
assets that generates cash inflows that are largely independent of 
the cash inflows from other assets or groups of assets
impairment losses are recognised in profit or loss impairment losses
recognised in respect of cash generating units are allocated first to
reduce the carrying amount of goodwill allocated to the cash
generating unit and then to reduce the carrying amount of other
assets in the unit on a pro rata basis
an impairment loss in respect of goodwill is not reversed in respect 
of other assets impairment losses recognised in prior periods are
assessed at each reporting date for any indications that the loss has
decreased or no longer exists an impairment loss is reversed if there
has been a change in the estimates used to determine the recoverable
amount an impairment loss is reversed only to the extent that the
asset’s carrying amount does not exceed the carrying amount that
would have been determined net of depreciation or amortisation 
if no impairment loss had been recognised
financial statements
notes to the consolidated financial statements continued
74 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
s inventories
inventories are measured at the lower of cost or net realisable value
net realisable value is the estimated selling price less the estimated
costs incurred until the sale and the estimated variable costs required
to sell all inventories are written down individually where the net
realisable value of inventories is lower than their carrying amounts
the measurement method applied to similar inventory items is the
weighted average cost formula
t provisions
a provision is recognised in the consolidated balance sheet when the
group has a legal or constructive obligation as a result of a past event
it is probable that an outflow of economic benefits will be required to
settle the obligation and the outflow of economic benefits can be
reliably estimated if the effect is material provisions are determined
by discounting the expected future cash flows at a pretax rate that
reflects current market assessments of the time value of money 
and the risks specific to the liability
i maintenance provision for leased aircraft
t o reflect the legal obligations placed upon the group under the terms
of certain operating leases provision is made for the maintenance
overhaul and repair costs of operating leased airframes engines and
certain other components the provision is based on the present value
of total anticipated external costs over the useful economic life of the
asset calculated by reference to costs experienced and published
manufacturers’ data the charge to the income statement is calculated
by reference to the number of hours and cycles flown and by reference
to the length of the full overhaul cycle costs incurred are charged
against the provision neither the timing nor the value of the
expenditure can be precisely determined but they can be averaged
over time and over a fleet the unwinding of discounted values is
charged to the income statement as a financial expense
the cost of major overhauls of owned airframes and engines is
capitalised and depreciated over the period until the next scheduled
major overhaul
ii restructuring provision
a provision for restructuring is recognised when the group has
approved a detailed and formal restructuring plan and the
restructuring either has commenced or has been announced publicly
future operating costs are not provided for
iii onerous contracts
a provision for onerous contracts is recognised when the expected
benefits to be derived by the group from the contract are lower than
the unavoidable cost of meeting its obligations under the contract 
the provision is measured at the present value of the lower of the
expected cost of terminating the contract and the expected net cost
of continuing with the contract before a provision is established the
group recognises any impairment loss on the assets associated with
that contract
u minority interest
in the consolidated balance sheet the share of net assets attributable
to minority shareholders is disclosed as a separate component of
equity after share capital and reserves although it is neither a financial
liability nor an equity instrument the consolidated income statement
discloses the amount of the result for the year attributable to 
minority shareholders
where the group has a written put option in respect of a minority
interest and has an unavoidable obligation to purchase the
shareholding the minority interest is recorded as a financial liability 
at fair value rather than being reported as a separate component of
equity no result is attributable to minority shareholders and instead
changes to the fair value of the financial liability are recorded at each
period end in the income statement within financial income or
financial expenses
on purchase or sale of a minority interest shareholding held in a
group subsidiary the group recognises increases or decreases in its
interest directly in equity
v related parties
for the purpose of these consolidated financial statements parties 
are considered to be related to the group if the group has the ability
directly or indirectly to control the party or exercise significant
influence over the party making financial and operating decisions or
vice versa or where the group and the party are subject to common
control or common significant influence related parties may be
individuals or other entities
w segment reporting
a segment is a distinguishable component of the group that is
engaged either in providing related products or services business
segment or in providing products or services within a particular
economic environment geographical segment which is subject to
risks and returns that are different from those of other segments
segment information is presented in respect of the group’s business
and geographical segments the group’s primary format for segment
reporting is based on business segments as described in note 2 all
items are allocated to segments except corporate costs net financial
expenses and corporate assets and liabilities
x use of estimates
the preparation of financial statements requires management to make
judgements estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets liabilities
income and expenses actual results may differ from these estimates
estimates and underlying assumptions are reviewed on an ongoing
basis revisions to accounting estimates are recognised in the period
in which the estimates are revised and in any future periods affected
details of critical judgements significant estimates and assumptions
are disclosed in the relevant notes to the consolidated financial
statements the key estimates and judgements are described in 
note 31
tui travel plc annual report  accounts 2009 75
wwwtuitravelplccom y determination of fair values
a number of the group’s accounting policies and disclosures require
the determination of fair value for both financial and nonfinancial
assets and liabilities fair values have been determined for
measurement andor disclosure purposes based on the following
methods when applicable further information about the assumptions
made in determining fair values is disclosed in the notes specific to
that asset or liability
i property plant and equipment
the fair value of property plant and equipment recognised as a result
of a business combination is based on market values the market value
of property is the estimated amount for which a property could be
exchanged on the date of valuation between a willing buyer and a willing
seller in an arms length transaction after proper marketing wherein
the parties had each acted knowledgeably prudently and without
compulsion the market value of items of plant equipment fixtures
and fittings is based on the quoted market prices for similar items
ii intangible assets
the fair value of intangible assets recognised as a result of a business
combination including brands customer relationships and the
customer order book at the date of acquisition is valued by reference
to external market values or income based methods income based
methods estimate the future economic benefits to be derived from
ownership of the asset by identifying quantifying and separating cash
flows attributable to the asset and capitalising their present value
iii inventories
the fair value of inventories acquired in a business combination is
determined based on the estimated selling price in the ordinary
course of business less the estimated costs of completion and sale
and a reasonable profit margin based on the effort required to
complete and sell the inventories
iv investments in equity and debt securities
the fair value of financial assets at fair value through profit or loss and
available for sale financial assets is determined by reference to their
quoted closing bid price at the reporting date where available the fair
value of held to maturity investments is determined on initial recognition
and thereafter for disclosure purposes only
v trade and other receivables
trade receivables are recognised at their fair value and subsequently
recorded at amortised cost using the effective interest method as
reduced by allowances for estimated irrecoverable amounts an
allowance for irrecoverable amounts is established when there is
objective evidence that the group will not be able to collect all
amounts due according to the original terms of the receivables the
amount of allowance is the difference between the asset’s carrying
amount and the present value of estimated future cash flows
vi trade payables
trade payables are recognised at their fair value and subsequently
recorded at amortised cost using the effective interest method
vii derivatives
the fair value of foreign currency contracts fuel forward contracts and
option contracts is their forward market price at the balance sheet date
based on external valuations or internal valuations using market data
viii nonderivative financial liabilities
fair value which is determined for disclosure purposes is calculated
based on the present value of future principal and interest cash flows
discounted at the market rate of interest at the reporting date for
finance leases the market rate of interest is determined by reference
to similar lease agreements
ix sharebased payments
the fair value of the shares awarded is measured using option
valuation models taking into account the terms and conditions upon
which the awards were made the valuation basis is identical whether
the awards will be settled in cash or shares
z new standards and interpretations not yet adopted
ifrs 8 operating segments has been endorsed by the european
union and will be effective for the year ending 30 september 2010
ifrs 8 introduces the ‘management approach’ to segment reporting
and will require presentation and disclosure of segment information 
to be based on the internal reports regularly reviewed by the group’s
chief operating decision maker in order to assess each segment’s
performance and to allocate resources to them currently the group
presents segment information in respect of its business segments
note 2 and will continue to do so under the new standard the
group is currently assessing the impact that this standard will have 
on the disclosures presented for each segment
ifrs 3 2008 business combinations supersedes ifrs 3 2004
business combinations and has been endorsed by the european
union and will be effective for all acquisitions completing on or after 
1 october 2009 there will be no retrospective application
ifrs 3 2008 changes the treatment of incidental acquisition
expenses the treatment of deferred consideration payments which 
are contingent on continued employment the measurement of
consideration payable and the treatment of changes to the amount 
of consideration payable it is likely to lead to items being expensed in
the income statement which would previously have been included as
part of the cost of investment in an acquired business the financial
impact of this revised standard will be determined by the prospective
acquisitions undertaken by the group
the following standards are also endorsed by the european union but
are not expected to have a significant impact on the group’s financial
statements in future years
ias 1 2008 presentation of financial statements has been 
amended and will be applicable for the first time for the year ending 
30 september 2010 the changes will have a presentational impact
only and will not affect the recognition or measurement of items in 
the financial statements
ias 32 2008 financial instruments presentation clarifies the
treatment of puttable financial instruments and will be effective for
the first time for the year ending 30 september 2010
ias 39 2008 financial instruments recognition and measurement 
is effective for the first time for the year ended 30 september 2010
the revised standard allows reclassification of instruments into and
out of ‘at fair value through profit and loss’ in certain circumstances
and clarifies the designation of hedges at a segment level
ifrs 7 2008 financial instruments disclosure is effective for the 
first time for the year ending 30 september 2010 and introduces
further disclosure requirements in respect of fair value measurements
and liquidity risk
the group continues to monitor the potential impact of other 
new standards and interpretations which may be endorsed by the
european union and require adoption by the group in future
accounting periods
financial statements
notes to the consolidated financial statements continued
76 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
2 segmental information
segmental information is presented initially by the group’s business sectors the primary format and secondly by geographic region segment
results assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis
unallocated items comprise corporate costs net financial expenses and corporate assets and liabilities
a sector analysis
the sector analysis is based on the group’s management and reporting structure a detailed explanation of each sector is included in the
business performance review
mainstream sector
specialist  joint
total emerging accommodation ventures
central northern western mainstream markets activity  destinations and eliminations total
europe region europe sector sector sector sector associates corporate group
year ended 30 september 2009 £m £m £m £m £m £m £m £m £m £m
revenue
t otal revenue 4829 4302 2671 11802 825 816 738 – 318 13863
inter segment revenue 33 80 19 132 – – 186 – 318 –
external revenue
– continuing operations 4796 4151 2652 11599 816 758 549 – – 13722
– acquired operations – 71 – 71 9 58 3 – – 141
total external revenue 4796 4222 2652 11670 825 816 552 – – 13863
operating profitloss 18 115 124 9 18 6 36 9 41 37
amortisation of business
combination intangibles 120 3 24 813 11 – –56
separately disclosed items 47 71 154 272 5 33 13 3 14 340
impairment of goodwill ––––– 7 – –– 7
t axation on profits of joint
ventures and associates –––––– – 3 – 3
underlying operating profitloss 66 206 33 305 31 59 60 15 27 443
analysed as
continuing operations 66 204 33 303 30 54 60 15 27 435
acquired operations –2 –215 – – –8
443
net financial expenses excluding separately disclosed items note 4 77
underlying profit before tax 366
mainstream sector
specialist  joint
t otal emerging accommodation ventures
central northern western mainstream markets activity  destinations and eliminations t otal
europe region europe sector sector sector sector associates corporate group
year ended 30 september 2008 £m £m £m £m £m £m £m £m £m £m
revenue
t otal revenue 4714 4532 2753 11999 819 780 701 – 367 13932
inter segment revenue 12 155 1 168 – – 199 – 367 –
external revenue
– continuing operations 4702 4377 2752 11831 808 706 495 – – 13840
– acquired operations –––– 11 74 7 – – 92
t otal external revenue 4702 4377 2752 11831 819 780 502 – – 13932
operating lossprofit 113 104 20 197 1 4 42 12 38 184
amortisation of business
combination intangibles 1 58 2 61 8 8 10 – – 87
separately disclosed items 62 224 15 301 17 46 5 – 11 380
impairment of goodwill 112 – – 112 – – – – – 112
t axation on profits of joint
ventures and associates –––––– – 3 – 3
underlying operating profitloss 62 178 37 277 26 50 57 15 27 398
analysed as
continuing operations 62 178 37 277 26 42 57 15 27 390
acquired operations ––––– 8 – –– 8
398
net financial expenses excluding separately disclosed items note 4 79
underlying profit before tax 319
tui travel plc annual report  accounts 2009 77
wwwtuitravelplccom mainstream sector
specialist  joint
total emerging accommodation ventures
central northern western mainstream markets activity  destinations and total
30 september 2009 and
europe region europe sector sector sector sector associates corporate group
the year then ended £m £m £m £m £m £m £m £m £m £m
balance sheet
segment assets 1272 3701 1223 6196 631 979 1405 112 174 9149
segment liabilities 1574 2202 978 4754 213 318 490 – 1088 6863
other disclosures
capital expenditure 32 83 59 174 5 35 16 – 4 234
t otal depreciation of 
ppe and amortisation 39 101 74 214 12 34 27 – – 287
impairment of goodwill
and other intangibles ––––– 7 – –– 7
impairment of property 
plant and equipment – – 124 124 – 1 – – – 125
mainstream sector
specialist  joint
t otal emerging accommodation ventures
central northern western mainstream markets activity  destinations and t otal
30 september 2008 and
europe region europe sector sector sector sector associates corporate group
the year then ended £m £m £m £m £m £m £m £m £m £m
balance sheet
segment assets 1231 3636 1184 6051 598 814 1252 114 498 9327
segment liabilities 1610 1975 934 4519 266 279 469 – 1198 6731
other disclosures
capital expenditure 20 103 37 160 4 26 18 – – 208
t otal depreciation of 
ppe and amortisation 45 173 60 278 10 21 22 – – 331
impairment of goodwill 
and other intangibles 112 – – 112 – 2 – – – 114
impairment of property 
plant and equipment 5 18 – 23 – 8 – – – 31
the segmental assets and liabilities above do not include intercompany balances or investments that are eliminated at group level and therefore
the analysis does not necessarily represent the net equity positions of the sectors as if they were standalone entities
assets shown under corporate as at september 2009 includes a £710m negative cash balance 2008 nil which is offset by positive cash
balances in other sectors as part of the group’s cash pooling facility
capital expenditure comprises additions to plant property and equipment note 11 and computer software and licences note 10
b geographical analysis of business
in presenting information on the basis of secondary geographic segments segment revenue is based on the geographic location of the customer
that generated that revenue segment assets and capital expenditure are based on the geographical location of the assets other europe is
defined as continental europe and eire excluding uk germany and france
uk germany france other europe rest of the world t otal
2009 2008 2009 2008 2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m £m £m £m £m
revenue from
external customers 4162 4392 3753 3689 1337 1424 3831 3682 780 745 13863 13932
segment assets 3784 3551 1051 1034 899 840 2402 2210 1075 1080 9211 8715
capital expenditure 65 81 55 16 36 16 59 72 19 23 234 208
segment assets exclude nonoperating assets relating to corporate entities and the group’s joint ventures and associates totalling negative assets
of £62m 2008 positive £612m
78 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
3 separately disclosed items
year ended year ended
30 september 30 september
2009 2008
£m £m
merger related integration costs 143 164
restructuring expenses 40 65
aircraft 157 151
total 340 380
separately disclosed items within the operating profitloss are included within the income statement as follows
year ended year ended
30 september 30 september
2009 2008
£m £m
revenue – 12
cost of sales 209 228
administrative expenses 131 140
total 340 380
merger related integration costs
these relate primarily to the costs of integration of the uk businesses the majority of costs arise from the integration of first choice and
thomson in the uk and in particular from the formation of one airline and an integrated retail estate a combined mainstream uk head office
has been established in luton costs also arise from bringing together former thomson specialist businesses with the former first choice activity
and specialist sectors notably ski and uk specialist brands in the accommodation  destinations sector separate first choice and tui t ourism
incoming agencies have been combined in a number of key destinations notably spain
costs include amounts paid or provided for redundancy and integration remuneration costs including the cost of the value creation share plan
and rolled over first choice share awards note 5d property closures and onerous lease obligations as well as professional fees relating to the
integration project
ifrs 3 business combination fair value adjustments in respect of first choice customer deposits held at 3 september 2007 reduced deferred
income by £14m at that date with a corresponding reduction in statutory revenues for the year ended 30 september 2008 and the period ended
30 september 2007 this amount is included within separately disclosed integration items for the year ended 30 september 2008 in order to
better present the underlying trading performance of the group in that year
restructuring expenses
costs incurred in the year ended 30 september 2009 relate to restructuring programmes which are not related to the business combination 
of first choice and the tui t ourism businesses the principal items are £16m relating to the closure of the sunsail clubs in turkey and the
caribbean announced in march 2009 £13m for the ongoing restructuring of the french tour operator nouvelles frontières and £8m for
restructuring the german source market as a consequence of the sale of tuifly’s city charter operation to air berlin plc
costs incurred in the year ended 30 september 2008 relate to restructuring programmes that were already underway in both the first choice 
and tui t ourism businesses prior to the business combination as well as subsequent restructuring activities across all sectors costs also related
to the integration of acquired businesses into the group principal restructuring projects included the integration of the sunsail and the moorings
businesses and the restructuring of le boat in tui marine the rationalisation of the nouvelles frontières tour operator product and the corsair
scheduled flying programme in france and an impairment charge in respect of the thomson alfresco assets
aircraft
aircraft costs relate to the continuing restructuring of the aircraft fleet in the year ended 30 september 2009 there is a £124m impairment
charge principally in respect of asset write downs of boeing 747s operated by corsair note 11 costs of £32m were incurred relating to the
transaction to sell tuifly’s city charter business to air berlin plc these costs include the income statement charge from discontinued hedge
accounting on fuel and currency hedges which are no longer required various contract cancellation penalties as well as legal and professional fees
foreign exchange losses on aircraft order book hedging of £16m have been offset by a gain of £23m from discontinued hedge accounting on the
10 boeing 787 orders which have been cancelled further details of which are set out in note 25i net gains arising on the sale and leaseback of
aircraft were £4m £1m has been charged relating to the carrying value of aircraft held for sale note 18
in the year ended 30 september 2008 costs principally include sale and leaseback losses of £102m and writedowns on aircraft held for sale of
£23m note 11 other items include fuel and related currency option premium costs and losses on aircraft order book hedging note 25i
adjustments to prior period maintenance provision assumptions and other fleet reorganisation costs
tui travel plc annual report  accounts 2009 79
wwwtuitravelplccom 4 net financial expenses
year ended year ended
30 september 30 september
2009 2008
£m £m
financial income
bank interest receivable 6 42
interest on pension scheme assets 64 68
interest receivable in respect of loans to parent – 4
other financial income 2 8
total 72 122
financial expenses
bank interest payable on loans and overdrafts 11 45
interest on pension scheme liabilities 81 72
interest payable in respect of loans from parent 42 67
finance lease charges on leases 10 12
unwinding of discount on provisions 5 4
other financial expenses 12 5
total 161 205
net financial expenses 89 83
year ended year ended
30 september 30 september
2009 2008
£m £m
net financial expenses as above 89 83
less separately disclosed financial expenses 12 4
net underlying financial expenses 77 79
the separately disclosed financial expenses relate to non debt items including the revaluation of a put option written by the group in respect of 
a minority shareholder of l’tur t ourismus ag further details are given in note 19
5 employees
year ended year ended
30 september 30 september
2009 2008
a average number of employees number number
by sector
mainstream sector 34913 36382
specialist  emerging markets sector 1607 1864
activity sector 4659 4199
accommodation  destinations sector 7673 6951
corporate 611 605
total 49463 50001
the 2008 comparative numbers have been adjusted to ensure that they are in alignment with a revised method of allocating headcount to the
various sectors there is no change to the total number of employees
year ended year ended
30 september 30 september
2009 2008
b staff costs £m £m
wages and salaries 1293 1263
social security costs 234 216
pension costs 47 55
sharebased payments note 5d 17 15
total 1591 1549
included within wages and salaries are £65m 2008 £82m of redundancy and integration costs these related staff costs are included within
separately disclosed items note 3
80 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
c pension costs
the group operates pension schemes for employees eligible and wishing to participate in the schemes these comprise both defined
contribution and defined benefit schemes pension obligations vary reflecting the different legal and market conditions in each country of
operation defined contribution schemes are funded by the payment of contributions to private and staterun organisations whilst defined
benefit schemes comprise both funded and unfunded schemes the assets of all the funded defined benefit schemes are held separately from
the assets of the group
defined contribution schemes for employees and directors
current contributions are recognised as an expense in the year and once paid the group has no further liability pension costs of £20m 
2008 £25m relating to defined contribution schemes were charged to the income statement
defined benefit pension schemes
the movement of defined benefit pension obligations and assets is detailed below summarised as uk germany and other other includes
funded schemes in ireland the netherlands switzerland and norway whilst the main unfunded arrangements are in austria and france 
almost all uk schemes are funded whilst german schemes are unfunded
the principal funded schemes in the uk are shown in the table below these are closed to new members with the exception of existing
employees working towards their entry qualification date
date of last full average employee 
scheme name actuarial valuation average group contribution rate contribution rate
britannia airways limited superannuation and life assurance scheme 31 march 2006 379 plus £463m per annum 96
tui pension scheme uk 31 march 2005 118 plus £164m per annum 53
air 2000 limited retirement benefits scheme 1 november 2006 264 plus £14m per annum 98
unijet group plc final salary scheme 1 november 2006 247 plus £13m per annum 100
where there is more than a single class of membership contribution rates reflect weighted average values within the scheme contribution rates
are stated before adjustment for salary sacrifice arrangements where applicable
the principal unfunded schemes in germany are shown below these were all subject to a full actuarial valuation within three months preceding
the balance sheet date
scheme name status
versorgungsordnung’ hapaglloyd fluggesellschaft mbh open to new members
versorgungsordnung’ tui deutschland gmbh closed to new members
versorgungsordnung’ tui leisure travel gmbh closed to new members
valuations of the schemes are made by qualified actuaries using marketbased valuations for the assets and the projected unit method for the
liabilities the group recognises all actuarial gains or losses in the consolidated statement of recognised income and expense
the assets of each scheme have been taken at market value and liabilities in each territory have been calculated using the following principal
assumptions
uk
1
per annum germany per annum other
4
per annum
2009 2008 2009 2008 2009 2008
    
inflation 32 36 18 na 19 na
salary inflation 42
2
51
2
25 2135
3
29 0020
3
discount rate 55 69 525 675 48 41
1 pension increases in the uk schemes reflect the general inflation assumption subject to minimum and maximum increase limits
2 42 2008 51 is applicable across all uk schemes with the exception of the britannia airways limited superannuation and life assurance scheme which has assumed salary inflation of 37
plus 08 2008 46 plus 08 to reflect annual service increments
3 in germany and other the prior year salary inflation assumption is a percentage increment relative to inflation
4 the assumptions for other are a weighted average
tui travel plc annual report  accounts 2009 81
wwwtuitravelplccom the mortality assumptions underlying the value of the accrued liabilities for each territory are set out in the tables below the mortality
assumptions are based on relevant standard mortality tables in each territory
2009 2008
uk life expectancy weighted average years years
males
life expectancy in years for a pensioner retiring aged 65 on the balance sheet date 229 229
life expectancy in years for a pensioner retiring aged 65 20 years after the balance sheet date 242 241
females
life expectancy in years for a pensioner retiring aged 65 on the balance sheet date 252 253
life expectancy in years for a pensioner retiring aged 65 20 years after the balance sheet date 264 263
2009 2008
germany life expectancy years years
males
life expectancy in years for a pensioner retiring aged 65 on the balance sheet date 182 180
life expectancy in years for a pensioner retiring aged 65 20 years after the balance sheet date 209 207
females
life expectancy in years for a pensioner retiring aged 65 on the balance sheet date 223 221
life expectancy in years for a pensioner retiring aged 65 20 years after the balance sheet date 249 247
2009 2008
other life expectancy weighted average years years
males
life expectancy in years for a pensioner retiring aged 65 on the balance sheet date 188 188
life expectancy in years for a pensioner retiring aged 65 20 years after the balance sheet date 202 200
females
life expectancy in years for a pensioner retiring aged 65 on the balance sheet date 218 217
life expectancy in years for a pensioner retiring aged 65 20 years after the balance sheet date 225 224
the fair value of assets of the schemes in each territory are set out below
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
equities 457 427 – – 46 38 503 465
government debt 210 153 – – 37 33 247 186
corporate bonds 129 115 – – 21 16 150 131
property 15 15 – – 1 1 16 16
cash and cash equivalents 45 82 – – 1 – 46 82
other 86 18 – – 31 26 117 44
total 942 810 – – 137 114 1079 924
the expected rates of return on each category of assets in each territory are as follows
uk germany other
2009 2008 2009 2008 2009 2008
     
equities 78 82 na na 80 80
government debt 41 47 na na 42 43
corporate bonds 55 73 na na 38 43
property 60 82 na na 58 67
cash and cash equivalents 05 50 na na 05 na
other 74 50 na na 25 2547
overall expected rate of return 62 70 na na 51 51
the overall expected rate of return is calculated by weighting the individual rates in accordance with the anticipated balance in the schemes’
investment portfolio the fair values of the schemes’ assets are not intended to be realised in the short term and may be subject to significant
change before they are realised
82 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
changes in the fair value of scheme assets in each territory are as follows
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
balance at beginning of year 810 891 – – 114 103 924 994
expected return on scheme assets 58 62 – – 6 6 64 68
company contributions 86 69 – – 6 2 92 71
member contributions 6 6 – – 1 1 7 7
benefits paid 55 40 – – 6 3 61 43
experience gainslosses 37 178 – – 3 15 34 193
amounts arising from transfers – – – – – 4 – 4
foreign exchange – – – – 19 16 19 16
balance at end of year 942 810 – – 137 114 1079 924
actual return on scheme assets 95 116 – – 3 9 98 125
employer contributions in the next year are expected to be £89m in respect of the uk and £5m in respect of other
the composition of the fair value of scheme assets in each territory is as follows
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
schemes with surplus of assets 2 2 – – 10 91 12 93
schemes with deficit of assets 940 808 – – 127 23 1067 831
total 942 810 – – 137 114 1079 924
changes in the present value of defined benefit obligations in each territory are as follows
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
balance at beginning of year 1015 1144 50 48 113 97 1178 1289
reclassification – – 18 – – – 18 –
current service cost 20 25 3 2 4 4 27 31
interest cost on obligation 69 64 5 3 7 5 81 72
benefits paid 55 40 3 2 8 4 66 46
member contributions 6 6 – – 1 1 7 7
experience lossesgains 272 184 13 8 20 5 305 197
settlement and curtailment – – – – – 1 – 1
amounts arising from transfers – – 1 1 – 2 1 3
foreign exchange – – 10 6 19 14 29 20
balance at end of year 1327 1015 97 50 156 113 1580 1178
the reclassification within germany relates to flight crew early retirement benefits which were previously disclosed in accruals
the amounts recognised in the consolidated income statement for the years ended 30 september 2009 and 30 september 2008 for each
territory are as follows
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
current service cost 20 25 3 2 4 4 27 31
gains on curtailments and settlements – – – – – 1 – 1
interest on defined benefit pension 
scheme obligation 69 64 5 3 7 5 81 72
expected return on defined benefit 
pension scheme 58 62 – – 6 6 64 68
total 31 27 8 5 5 2 44 34
tui travel plc annual report  accounts 2009 83
wwwtuitravelplccom these amounts are included within the following expenseincome categories in the consolidated income statement
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
cost of sales 10 15 2 1 3 2 15 18
administrative expenses 10 10 1 1 1 1 12 12
financial expenses 69 64 5 3 7 5 81 72
financial income 58 62 – – 6 6 64 68
total 31 27 8 5 5 2 44 34
the amounts recognised directly in equity for the year ended 30 september 2009 and for the year ended 30 september 2008 for each territory
are as follows
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
cumulative lossesgains 
brought forward 204 210 8 – 1 10 195 200
lossesgains recognised 
during the year 235 6 13 8 23 10 271 4
foreign exchange – – – – 2 1 2 1
cumulative lossesgains 
carried forward 439 204 5 8 24 1 468 195
trend analysis information in respect of the uk germany and other territories is as follows
uk
2009 2008 2007 2006 2005
uk balance sheet £m £m £m £m £m
fair value of scheme assets 942 810 891 781 698
present value of scheme liabilities 1327 1015 1144 1125 1181
deficit 385 205 253 344 483
2009 2008 2007 2006 2005
uk experience adjustments £m £m £m £m £m
experience gainloss on scheme assets 37 178 7 11 69
experience lossgain on scheme liabilities 272 184 95 108 240
germany
2009 2008 2007 2006 2005
germany balance sheet £m £m £m £m £m
fair value of scheme assets – ––––
present value of scheme liabilities 97 50 48 53 49
deficit 97 50 48 53 49
2009 2008 2007 2006 2005
germany experience adjustments £m £m £m £m £m
experience gainloss on scheme assets – ––––
experience lossgain on scheme liabilities 13 8 11 1 2
84 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
other
2009 2008 2007 2006 2005
other balance sheet £m £m £m £m £m
fair value of scheme assets 137 114 103 91 77
present value of scheme liabilities 156 113 97 87 80
deficitsurplus 19 164 3
2009 2008 2007 2006 2005
other experience adjustments £m £m £m £m £m
experience lossgain on scheme assets 3 15 1 – 3
experience lossgain on scheme liabilities 20 51410 4
total
2009 2008 2007 2006 2005
all territories’ balance sheet £m £m £m £m £m
fair value of scheme assets 1079 924 994 872 775
present value of scheme liabilities 1580 1178 1289 1265 1310
deficit 501 254 295 393 535
2009 2008 2007 2006 2005
all territories’ experience adjustments £m £m £m £m £m
experience gainloss on scheme assets 34 193 8 11 72
experience lossgain on scheme liabilities 305 197 120 117 246
the movement in the net deficit for pensions is as follows
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
balance at beginning of year 205 253 50 48 2 8 253 293
reclassification – – 18 – – – 18 –
provisions made during the year 31 – 8 5 5 2 44 7
provisions used during the year 86 42 3 2 8 2 97 46
amounts arising from transfers 
in and out – – 1 1 – 2 1 1
actuarial gainloss recognised 
in equity 235 6 13 8 23 10 271 4
foreign exchange – – 10 6 – 2 10 4
balance at end of year 385 205 97 50 18 2 500 253
the reclassification within germany relates to flight crew early retirement benefits which were previously disclosed in accruals
tui travel plc annual report  accounts 2009 85
wwwtuitravelplccom reconciliation of defined benefit obligations and scheme assets to values recognised in the balance sheet
uk germany other t otal
2009 2008 2009 2008 2009 2008 2009 2008
£m £m £m £m £m £m £m £m
present value of funded defined 
benefit obligations 1326 1014 – – 139 100 1465 1114
fair value of scheme assets 942 810 – – 137 114 1079 924
present value of unfunded defined 
benefit obligations 1 1 97 50 17 13 115 64
385 205 97 50 19 1 501 254
unrecognised past service cost – – – – 1 1 1 1
recognised liability for defined 
benefit obligation 385 205 97 50 18 2 500 253
analysed as
retirement benefit noncurrent assets – – – – 1 17 1 17
retirement benefit current liabilities – – 3 2 – – 3 2
retirement benefit noncurrent 
liabilities 385 205 94 48 19 15 498 268
total 385 205 97 50 18 2 500 253
the sensitivity of the fair value of the defined pension deficit to the key financial and demographic assumptions is illustrated below
uk germany other total
2009 2009 2009 2009
£m £m £m £m
decrease in deficit from increasing discount rate by 025 59 6 7 72
increase in deficit from reducing discount rate by 025 6277 76
increase in deficit from increasing all life expectancies by 1 year 3874 49
d share award schemes
the company operates three principal share award schemes which are designed to link remuneration to the future performance of the group
the schemes are the performance share plan psp the deferred annual bonus scheme dabs and the value creation synergy plan vcsp
all three schemes are described in the remuneration report along with the relevant vesting criteria
at 30 september 2009 the shares allocated and outstanding in respect of ordinary shares were as follows
share award scheme number of shares date due to vest
performance share plan 425739 13 february 2010
1208158 13 february 2010
1076195 13 february 2010
1822352 13 september 2010
618046 19 december 2010
2848557 19 december 2010
131840 19 may 2011
1045662 28 november 2011
6341589 28 november 2011
deferred annual bonus scheme 846090 13 february 2010
2642069 19 december 2010
4681760 28 november 2011
value creation synergy plan 1926629 28 november 2010
total 25614686
the number of share awards at the beginning and end of the year is as follows
number of awards
30 september 2009
outstanding at beginning of the year – excluding deferred shares 14540872
forfeited during the year 1481168
exercised during the year 2412082
granted during the year 14967064
outstanding at the end of the year 25614686
in addition to the above shares there are 1830960 2008 714937 deferred shares outstanding in relation to the deferred annual bonus
scheme these are due to vest between 19 december 2010 and 28 november 2011
86 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
no material awards have been made to date under the group’s hmrcapproved share incentive plan which is an allemployee share plan
the fair value of services received in return for share awards granted during the year is measured by reference to the fair value of the shares
awarded the fair value at the date the shares were awarded has been estimated using a binomial methodology for all schemes except where
there is a marketbased performance condition attached to vesting in which case a monte carlo simulation was used the principal assumptions
required by these methodologies were
2009 2008 2007
information relating to fair values of shares awarded
fair value at measurement date £134£182 £105£242 £109£271
share price £205 £251£270 £260£286
expected volatility 449 304348 257284
award life 3 years 3 years 3 years
expected dividends 38 36 38
risk free interest rate 273 452475 505535
participants are not entitled to dividends prior to vesting expected volatility is based on historic volatility adjusted for changes to future volatility
indicated by publicly available information shares were awarded under a service condition
employee expenses for the year
employee expenses for the current year and prior period relating to sharebased schemes are
year ended year ended
30 september 30 september
2009 2008
£m £m
shares awarded in 2006 – 2
shares awarded in 2007 4 6
shares awarded in 2008 5 6
shares awarded in 2009 7 –
equitysettled 16 14
expense arising for share appreciation rights 1 1
total 17 15
included in the charge for equity awards made in 2009 is £3m relating to the vcsp the shares this charge corresponds to will be awarded after
the date of these accounts
of the £17m total employee expenses relating to sharebased schemes incurred in the year ended 30 september 2009 £6m 2008 £9m is
included within separately disclosed items note 3 as relating to specific remuneration incurred for postmerger integration
the future estimated expense for share award schemes outstanding at 30 september is
30 september 30 september
2009 2008
£m £m
t o be incurred within one year 16 13
t o be incurred after more than one year 9 11
total 25 24
at 30 september 2009 10842908 shares 2008 11875944 shares were held by the group’s employee benefit trust
e remuneration of directors
year ended year ended
30 september 30 september
2009 2008
£m £m
emoluments 10 12
pensions and other retirement benefits 1 1
total 11 13
further information is provided in the remuneration report
tui travel plc annual report  accounts 2009 87
wwwtuitravelplccom 6 income expenses and auditors’ remuneration
year ended year ended
30 september 30 september
2009 2008
included in the consolidated income statement for the year are the following creditscharges £m £m
operating lease income aircraft 18 6
operating lease rentals land and buildings 163 167
operating lease rentals aircraft and other equipment 408 327
depreciation of property plant and equipment 184 206
amortisation of intangible assets 103 125
charge for sharebased payments 17 15
profitloss on sale of property plant and equipment 12 71
gainloss on foreign currency retranslation 23 26
impairment of goodwill and other intangibles 7 114
impairment of property plant and equipment 125 31
operating lease rentals land and buildings includes £8m 2008 £19m of costs included in separately disclosed items note 3 as provisions 
for onerous leases primarily related to the closure of sunsail clubs in turkey £4m and integration of the uk thomsonfirst choice retail estate
£4m also within separately disclosed items is £1m of costs in relation to aircraft leases in addition to the operating lease rentals disclosed
above charges of £71m 2008 £77m were incurred in respect of hotel accommodation rentals which are disclosed as operating leases under
ifric 4 determining whether an arrangement contains a lease
year ended year ended
30 september 30 september
2009 2008
£m £m
auditors’ remuneration
auditors’ remuneration for these financial statements and other group subsidiary financial statements pursuant to legislation 2 2
other services pursuant to legislation including regulatory reporting 1 1
other services 1 1
auditors’ remuneration refers to fees paid to the group’s auditors kpmg audit plc and its associates and does not include fees paid to other
auditors who audit subsidiaries of the group
other services are principally in respect of defined benefit pension scheme advice and tax compliance work in respect of certain overseas subsidiaries
88 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
7 taxation
the tax creditcharge can be summarised as follows
year ended year ended
30 september 30 september
2009 2008
i analysis of creditcharge in the year £m £m
current tax charge
uk corporation tax on loss for the year 21 –
nonuk tax on loss for the year 41 54
adjustments in respect of previous years 3 1
17 55
deferred tax credit
origination and reversal of timing differences
current year uk 5 43
current year nonuk 43 12
adjustments in respect of previous years 11 –
59 55
total income tax credit in consolidated income statement 42 –
ii reconciliation of effective tax rate
the total tax credit for the year is higher 2008 lower than the standard rate of corporation tax in the uk of 28 2008 29 the differences
are explained below
year ended year ended
30 september 2009 30 september 2008
£m  £m 
loss before tax reported in the consolidated income statement 52 267
less share of profit in joint ventures and associates note 12 9 12
61 279
income tax on loss before tax excluding share of profit of joint ventures 
and associates at the standard rate of uk tax of 28 2008 29 17 28 81 29
expenses not deductible for tax purposes 3 5 39 14
income not taxable 4 6 ––
utilisationnonutilisation of tax losses 1 2 44 16
higher tax rates on overseas earnings 8 13 ––
lower tax rates on overseas earnings 1 2 3 1
adjustments to taxation in respect of previous periods 14 23 1–
total income tax credit in consolidated income statement 42 69 ––
the underlying effective rate of taxation for the year ended 30 september 2009 is calculated based on the underlying profit before tax excluding
separately disclosed items amortisation of ifrs 3 business combination intangibles and goodwill impairment charges and is calculated at 28
the actual tax rate of 69 differs from the underlying effective tax rate due to the tax effect of separately disclosed items amortisation of ifrs 3
business combination intangibles goodwill impairment charges and the recognition in the current year of deferred tax assets on losses from prior
years due to a greater degree of certainty in the timing and method of their utilisation
iii deferred tax recognised directly in equity
the following taxation creditcharge has been recognised directly in equity within the consolidated statement of recognised income and
expense
year ended year ended
30 september 30 september
2009 2008
£m £m
cash flow hedges 39 58
defined benefit pension plans 65 4
other 1 –
total 105 62
tui travel plc annual report  accounts 2009 89
wwwtuitravelplccom 8 discontinued operation
the business of société d’investissement aérien sa trading as jet4you is the group’s airline operation in morocco and has been presented 
as a discontinued operation as it was acquired on 30 june 2008 exclusively with a view to its subsequent resale the business is also presented 
as a disposal group held for sale note 18
year ended year ended
30 september 30 september
2009 2008
£m £m
revenue 80 26
operating costs 86 25
loss before tax of discontinued operation 6 1
tax – 1
loss after tax of discontinued operation 6 –
provision for loss on disposal 8 –
loss for the year from discontinued operation 14 –
the provision for loss on disposal is based on the directors’ assessment of the fair value less costs to sell of the disposal group based on current
sale negotiations
9 dividends
the following dividends relate to ordinary shares which have been deducted from equity in the year
year ended year ended
30 september 30 september
pence 2009 2008
per share £m £m
dividends relating to the year ended 30 september 2007
interim dividend paid september 2007 25 – –
initial interim dividend paid april 2008 59 – 65
84 – 65
dividends relating to the year ended 30 september 2008
interim dividend paid october 2008 28 31 –
final dividend paid april 2009 69 76 –
97 107 –
the interim dividend in respect of the year ended 30 september 2009 of 30p per share was paid on 1 october 2009 and this dividend of £33m
will be recognised as a deduction from equity in the year ending 30 september 2010
subsequent to the balance sheet date the directors have proposed a final dividend of 77p per share 2008 final dividend of 69p per share
payable on 1 april 2010 to the holders of relevant shares on the register at 12 march 2010 the final proposed dividend amounts to £85m and
will after approval by shareholders be recognised in the consolidated financial statements for the year ending 30 september 2010 the final
ordinary dividend of 77p per share together with the interim dividend of 30p per share makes a total dividend of 107p per share relating to 
the year ended 30 september 2009
a dividend reinvestment plan is in operation those shareholders who have not elected to participate in this plan and who would like to participate
with respect to the 2009 final dividend may do so by contacting equiniti direct on 0871 384 2030 the last day for election for the final proposed
dividend is 18 march 2010 and any requests should be made in good time ahead of that date
90 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
10 intangible assets
customer computer software in
goodwill brands relationships software licences development other t otal
£m £m £m £m £m £m £m £m
cost
at 1 october 2007 3883 362 161 270 43 4 133 4856
additions 2 – 1 34 3 18 – 58
acquisition through business combinations 82 30 23 – 6 – 3 144
disposals 3 – 1 1 1 4 – 10
foreign exchange 230 23 19 6 6 – 2 286
at 30 september 2008 4194 415 203 309 57 18 138 5334
additions 3 – – 55 4 23 – 85
acquisition through business combinations 62 21 ––––– 83
disposals – – 1 15 2 – 4 22
reclassification to assets held for sale 17 21 14 3 4 – 1 60
foreign exchange 288 26 23 19 5 – 4 365
reclassification of asset class – – – 30 18 12 – –
at 30 september 2009 4530 441 211 395 42 29 137 5785
amortisation and impairment losses
at 1 october 2007 420 2 2 180 27 – 8 639
amortisation for the year – 20 14 38 4 – 49 125
impairment loss 112 – – – 2 – – 114
disposals – – 1 – 1 – – 2
foreign exchange 23 1 1 – 3 – 1 29
at 30 september 2008 555 23 16 218 35 – 58 905
amortisation for the year – 25 17 47 4 – 10 103
impairment loss 7 –––––– 7
disposals – – – 14 2 – 3 19
reclassification to assets held for sale – 2222 – – 8
foreign exchange 41 2 3 14 – – – 60
reclassification of asset class – – 1 15 16 – – –
at 30 september 2009 603 48 35 278 19 – 65 1048
net book value
at 1 october 2007 3463 360 159 90 16 4 125 4217
at 30 september 2008 3639 392 187 91 22 18 80 4429
at 30 september 2009 3927 393 176 117 23 29 72 4737
amortisation of intangible assets is recognised within cost of sales in the consolidated income statement
the goodwill impairment loss incurred in 2009 relates to sunsail clubs hotel operations in turkey and antigua which were closed during the year
whilst the impairment losses incurred in 2008 relate primarily to tuifly the group’s airline in germany both impairment charges are disclosed
within administrative expenses and shown separately on the face of the consolidated income statement
amortisation of business combination intangibles totalling £56m 2008 £87m shown on the face of the consolidated income statement relates
primarily to the amortisation of brands the order book shown within other above and customer relationships the remaining useful economic
life of these assets is up to 18 years
amortisation of business combination intangibles and depreciation combined with amortisation of other intangible assets is disclosed by segment
in note 2 impairment of property plant and equipment and intangible assets by segment is also disclosed in note 2
tui travel plc annual report  accounts 2009 91
wwwtuitravelplccom the aggregate carrying amounts of goodwill allocated to each principal cash generating unit cgu are as follows
30 september 30 september
2009 2008
cgu sector £m £m
uk and ireland mainstream northern region 1507 1501
accommodation  destinations accommodation  destinations 671 547
germany mainstream central europe region 406 352
nordics mainstream northern region 273 243
marmara  nouvelles frontières mainstream western europe 230 200
multiple cgus all sectors 861 805
total goodwill 3948 3648
of which
goodwill included within intangible assets 3927 3639
goodwill included in assets held for sale note 18 21 9
3948 3648
goodwill included in assets held for sale principally relates to the canadian business and jet4you
once every year or more frequently if events or a change in the economic environment indicate a risk of impairment the group assesses the
recoverable amount of goodwill allocated to its cgus as required by ias 36 impairment of assets the recoverable value of goodwill for all cgus
has been determined based on value in use
the multiple cgus not separately listed above do not individually represent more than 3 of total group goodwill all cgus have been tested 
for impairment
ias 36 requires that impairment tests are carried out on cgus following the level at which the group’s management measures returns on operations
the calculation of recoverable amount uses the following assumptions
• cash flow projections based on the group’s latest approved fiveyear business plan
• cash flows beyond the plan period are extrapolated using an inflationary only growth rate of between 1 and 3 the growth rate used is 
less than or equal to third party estimates of the medium term gdp growth rates of the key geographic markets in which the specific cgu
operates at the time the projections are prepared
• cash flows are discounted using the group’s weighted average cost of capital adjusted as appropriate for business specific factors of sector
risk business size and geographic risk
• since determination of an appropriate group weighted average cost of capital was judgemental sensitivities also addressed how increases 
in the base group weighted average cost of capital might impact the results of the impairment tests the group’s weighted average cost of
capital was based on a selection of third party financial institutions with significant knowledge of the group’s operations
• central group overheads are borne in full by cgus and are allocated pro rata to the cgu’s underlying operating profit
• where draft 2010 budgets indicated lower or higher underlying operating profit than the fiveyear business plan for any cgu cash flow
projections were rerun based on the revised operating profit information to obtain a more up to date value in use
the calculation of recoverable amount is sensitive to forecast future earnings and particularly the discount rates used
• a percentage decrease of up to 20 in future planned earnings for both the year ending 30 september 2010 and the year ending 
30 september 2011 would still result in significant headroom positions for all the principal cgus detailed in the table above
• in addition to the decreased earnings noted above an increase for the principal cgus detailed above of up to 15 percentage points in the
discount rates used would not change the conclusion that the carrying value of goodwill is supported by its recoverable amount
the sensitivities disclosed immediately above do not take account of any mitigating action that management would take should earnings decrease
92 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
other key assumptions are in respect of the short and medium term postacquisition earnings of acquired operations within the activity
specialist  emerging markets and accommodation  destinations sectors the forecast earnings of these newlyacquired businesses are
inherently more judgemental over these timeframes
the pretax discount rates used for each cgu or group of similar cgus are as follows
pretax discount rate used pretax discount rate used
30 september 2009 30 september 2008
sector cash generating units cgus  
mainstream uk and ireland 10 85
germany 11 95
nordics 11 105
marmara  nouvelles frontières 11 95
other cgus
1
11 105
specialist  emerging markets european specialist businesses
1
12 11
american specialist businesses
1
125 11
activity marine businesses
1
1213 115125
sport adventure student and ski businesses
1
13 13
accommodation  destinations accommodation  destinations 125 1075125
1 multiple individual cgus
based on the calculations undertaken the directors consider that the recoverable amount of goodwill in each cgu exceeds its carrying value
subject to the impairments noted below
impairment charges
impairment charges have arisen in the current and prior year as a result of the group’s restructuring post business combination
sunsail clubs
within the activity sector an impairment charge of £7m has arisen following the closure of the majority of sunsail clubs’ operations during the
current financial year in particular the turkish summer clubs were not opened in the summer of 2009 and it has been decided not to reopen the
antiguan colonna club during winter 20092010 the goodwill impairment charge has been calculated based on the value in use of the remaining
business using a discount rate of 13 2008 125
tuifly
in 2008 a £112m impairment charge in respect of goodwill in germany was recorded relating to tuifly the group’s airline in the german source
market part of the central european mainstream sector
the goodwill impairment arose as a result of the reclassification of tuifly as a disposal group held for sale as at 30 june 2008 this reclassification
was undertaken based on the plan to dispose of the airline into a new joint venture undertaking which would continue to provide flying capacity
to the german source market tour operator the goodwill impairment charge was calculated based on the fair value less costs to sell of tuifly
under the terms of the planned joint venture arrangement which was on a commercial arms length basis
as at 30 september 2008 tuifly was declassified as a disposal group held for sale and reclassified within the group’s ongoing noncurrent and
current assets and liabilities this was on the basis that a disposal transaction was no longer considered sufficiently probable the impairment
charge recorded during the year was not reversed at 30 september 2008 based on management’s then ongoing strategic review of tuifly
tui travel plc annual report  accounts 2009 93
wwwtuitravelplccom 11 property plant and equipment
advance
yachts payments for
land and motor boats and aircraft and future delivery computer other
buildings cruise ships equipment of aircraft equipment equipment t otal
£m £m £m £m £m £m £m
cost
at 1 october 2007 277 164 1581 – 154 364 2540
foreign exchange 21 10 107 – 5 33 176
acquisitions through business combinations 15 – – – 1 8 24
additions 31 10 45 – 15 51 152
disposals 15 9 749 – 3 29 805
transferred to assets held for sale – 5 103 – – 16 124
at 30 september 2008 329 170 881 – 172 411 1963
foreign exchange 36 8 87 2 8 41 182
acquisitions through business combinations 2 74 – – 1 6 83
transfers – – – 80 – 22 102
additions 16 14 31 33 5 53 152
disposals 30 22 75 7 14 25 173
reclassifications 5 1 11 – 3 14 –
transferred tofrom assets held for sale 19 4 32 – 1 1 9
at 30 september 2009 339 241 967 108 168 495 2318
depreciation and impairment
at 1 october 2007 140 41 698 – 112 232 1223
foreign exchange 12 2 20 – 10 14 58
acquisitions through business combinations 11 –––– 3 14
provided in the year 16 8 119 – 18 45 206
disposals 9 3 396 – 4 20 432
impairments – 1 23 – – 7 31
transferred to assets held for sale – 2 48 – – 13 63
at 30 september 2008 170 47 416 – 136 268 1037
foreign exchange 19 3 41 – 7 26 96
acquisitions through business combinations 1 36 – – – 4 41
provided in the year 17 16 99 – 14 38 184
disposals 18 12 66 – 11 22 129
impairments 1 – 124 – – – 125
reclassifications – 3 2 – 1 – –
transferred tofrom assets held for sale 15 – 17 – 1 1 –
at 30 september 2009 175 87 633 – 146 313 1354
net book value
at 1 october 2007 137 123 883 – 42 132 1317
at 30 september 2008 159 123 465 – 36 143 926
at 30 september 2009 164 154 334 108 22 182 964
94 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
impairment charges
impairment charges in the year ended 30 september 2009 total £125m 2008 £31m and are for aircraft £124m 2008 £23m and land and
buildings relating to sunsail clubs £1m 2008 nil the impairment charges are disclosed within cost of sales and as a separately disclosed item
note 3 segmental analysis of the impairment charge is presented in note 2
advance payments for future delivery of aircraft
advance payments for future delivery of aircraft were disclosed as prepayments in the year ended september 2008 but have been transferred 
to property plant and equipment in the current year there were £80m of advance payments for future delivery of aircraft at 30 september 2008
£73m within noncurrent prepayments and £7m within current prepayments the changes have been undertaken to align the group’s presentation
with its parent company no restatement to comparative financial information has been recorded on the basis of materiality
interest of £2m 2008 nil has been capitalised during the year in relation to the advance payments for future delivery of aircraft at a rate of 6
other equipment – advance payments for maintenance of owned aircraft
advance payments for maintenance of owned aircraft were disclosed as prepayments at 30 september 2008 and have been transferred to
property plant and equipment under construction within other equipment in the current year there were £22m of advance payments for aircraft
maintenance at 30 september 2008 all within noncurrent prepayments
sale and leaseback transactions
during the year ended 30 september 2009 there have been 11 aircraft sale and leaseback transactions seven of these transactions were 
fully conducted within the year the remaining four aircraft which had been purchased during the prior year were classified as held for sale at 
30 september 2008 and were then sold and leased back in the current year net gains arising on the sale and leaseback transactions in the year
ended 30 september 2009 were £4m which is included within cost of sales and also within separately disclosed items note 3
during the year ended 30 september 2008 the group sold and leased back 24 aircraft on operating leases as part of its aircraft fleet strategy 
of these aircraft 20 were previously owned and held within property plant and equipment and the sale was accounted for as a disposal the
remaining four aircraft were purchased sold and leased back within the year the loss on sale and leasebacks of £102m including the recognition
of opening maintenance provisions is included within cost of sales and also within separately disclosed items note 3
future commitments in respect of aircraft fleet operating leases are disclosed in note 27
assets held for sale
at 30 september 2009 one aircraft classified as a noncurrent asset held for sale at 30 september 2008 has been reclassified to property plant
and equipment a full depreciation charge has been recorded in the year
other disclosures
other property plant and equipment with a combined net book value as at 30 september 2009 of £182m 2008 £143m includes £103m 2008
£95m of fixtures and fittings £47m 2008 £20m of property plant and equipment under construction and £30m 2008 £27m of motor vehicles
land and buildings comprise freehold and short leasehold properties with net book values of £108m 2008 £98m and £56m 2008 £61m respectively
the net book value of assets held under finance leases and hire purchase contracts at 30 september 2009 was £152m 2008 £193m
the net book value of property plant and equipment with restrictions on title being pledged as security for bank loans amounted to £29m
2008 £39m
tui travel plc annual report  accounts 2009 95
wwwtuitravelplccom 12 investment in joint ventures associates and other investments
the group’s equity investment in its joint ventures and associates is recorded in the consolidated financial statements as follows
share of net share of net t otal
assets of assets of share of
joint ventures associates net assets
£m £m £m
cost
at 1 october 2007 64 12 76
share of profits before tax for the year 15 – 15
share of tax charge 3 – 3
increase in investment 9– 9
dividends paid 7 2 9
foreign exchange 718
at 30 september 2008 85 11 96
share of profits before tax for the year 8 4 12
share of tax charge 2 1 3
acquisitions –88
disposals 30 – 30
dividends paid 8 2 10
reclassifications and other movements 3 4 7
foreign exchange 73 10
at 30 september 2009 57 19 76
goodwill
at 1 october 2007 12 4 16
foreign exchange 112
at 30 september 2008 13 5 18
acquisitions 93 12
disposals 4 – 4
reclassifications and other movements – 7 7
foreign exchange 213
at 30 september 2009 20 16 36
net book value
at 1 october 2007 76 16 92
at 1 october 2008 98 16 114
at 30 september 2009 77 35 112
the group’s share of joint venture and associate profit after tax was £9m 2008 £12m during the year the group acquired a 499
shareholding in tui infot ec gmbh and a 49 shareholding in t ogebi holdings limited for consideration of £11m and £9m respectively
the disposal relates to the group acquiring the remaining 50 shareholding in sunshine cruises limited for a consideration of £30m on 
4 october 2008 from this date sunshine cruises ceased to be equity accounted and is instead fully consolidated as a subsidiary
the principal joint ventures and associates and the proportion held are shown below
country of registration
name of company  proportion held nature of business incorporation
joint ventures
travco group holding sae 500 incoming agency egypt
le passage to india t ours and travel pvt ltd 500 incoming agency india
atlantica hellas sa 500 hotel operator greece
atlantica hotels and resorts ltd 500 hotel operator cyprus
t ogebi holdings limited 490 t our operator cyprus
associates
turismo asia company limited 490 incoming agency thailand
tui infot ec gmbh 499 it services germany
t ogebi holdings limited operates in russia and ukraine
96 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
a summary of the results for the year ended 30 september 2009 and of the assets and liabilities at this date of the group’s joint ventures and
associates is shown below
joint ventures associates t otal
100 values £m £m £m
revenue 459 346 805
operating costs 441 333 774
operating profit 18 13 31
net interest payable 3 1 4
profit before taxation 15 12 27
t axation 3 2 5
profit after taxation for the year 12 10 22
noncurrent assets 182 34 216
current assets 140 62 202
t otal assets 322 96 418
noncurrent liabilities 75 11 86
current liabilities 130 49 179
t otal liabilities 205 60 265
net assets 117 36 153
nonconsolidated entities
trade and listed nonconsolidated
investments entities t otal
£m £m £m
at 1 october 2007 23 30 53
foreign exchange –33
at 30 september 2008 23 33 56
additions 36 3 39
disposals 9 – 9
repayment of loan notes 2 – 2
investments consolidated for the first time – 8 8
impairment during the year – 2 2
change in the fair value of available for sale financial asset 1 – 1
foreign exchange –44
at 30 september 2009 47 30 77
nonconsolidated entities are recorded at cost and reflect the group’s net investment held in circa 100 subsidiaries which due to the immaterial
size of their revenues result and financial position have not been consolidated balances between these entities and consolidated subsidiaries
have not been eliminated
other investments
other investments of £77m comprise trade and listed investments and nonconsolidated entities
trade and listed investments represent the group’s 143 shareholding in the airline group limited which in turn has a 42 shareholding in
national air traffic services limited a 99 shareholding in air berlin plc and a 10 holding in the atlantica leisure group limited
during the year the group announced a strategic cooperation between its german airline tuifly and air berlin plc as part of this transaction
the group prepaid an equity investment in air berlin plc of €33m equating to a 99 shareholding this is included in trade and listed
investments at 30 september 2009 on 3 october 2009 full clearance was received from the german competition authorities in respect of the
group’s investment in air berlin plc during the year a £1m loss on revaluation of the air berlin plc investment to fair value has been
recognised in equity no other material changes in the fair value of these investments have been recorded in the year
subsequent to the year end on 24 october 2009 the city charter operation of tuifly transferred to air berlin plc comprising 13 aircraft on wet
lease contracts
tui travel plc annual report  accounts 2009 97
wwwtuitravelplccom 13 investments
acquisitions
a acquisitions in the year ended 30 september 2009
acquisitions were made in the year for a total of £92m including £2m of acquisition expenses these acquisitions gave rise to provisional goodwill
of £58m the principal acquired businesses and their acquisition dates were
business description date country
mainstream sector – northern region
sunshine cruises limited trading as island cruises ltd cruise vessel operator october 2008 united kingdom
specialist  emerging markets sector
travel adventures inc t our operator october 2008 usa
activity sector
sport abroad uk limited t our operator october 2008 united kingdom
t eamlink travel limited t our operator october 2008 united kingdom
edwin doran limited t our operator november 2008 united kingdom
master yachting gmbh t our operator november 2008 germany
student skiing limited
1
trading as off the piste limited t our operator december 2008 united kingdom
adventure t ours australia group pty limited t our operator april 2009 australia
williment world travel limited t our operator may 2009 new zealand
zegrahm expeditions inc t our operator june 2009 usa
eac language centres uk limited language t eaching july 2009 united kingdom
accommodation  destinations sector
aragon t ours limited cruise services may 2009 united kingdom
1 formerly on the pistecom limited
in addition to the above the group acquired 15 individually insignificant businesses for a total consideration of £3m
the group acquired 100 of the voting equity instruments in respect of each acquisition completed during the year with the exception of
sunshine cruises limited trading as island cruises where the group previously held 50 and acquired all the remaining shares in the year
the relative size of the acquisitions made is set out in the table below
total t otal
consideration number of consideration goodwill
£m acquisitions £m £m
0 – 5 61514
5 – 10 32019
10 – 15 22321
15 131 1
total of businesses listed above 12 89 55
other individually insignificant businesses 15 3 3
total 27 92 58
98 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
the total net assetsliabilities acquired are set out below
fair value of
book value accounting net assets
prior to policy fair value liabilities
acquisition adjustments adjustments acquired
note £m £m £m £m
net assetsliabilities acquired
intangible fixed assets 1 3 – 18 21
property plant and equipment 2 53 1 10 42
current assets excluding cash 3 34 2 – 36
cash 34 – – 34
current liabilities excluding debt 3 53 1 – 54
deferred tax provision 4 – – 2 2
other noncurrent liabilities excluding debt 5 7 – 3 10
interestbearing liabilities 3 – – 3
61 – 3 64
adjusted for carrying value of share of sunshine cruises limited 
previously owned as a joint venture 30
total 34
t otal consideration 92
less net assets acquired as above 34
provisional goodwill arising 58
goodwill reclassified from investments in joint ventures on 
acquisition of sunshine cruises limited 4
total goodwill in respect of acquisitions 62
all acquisitions have been accounted for using the purchase method as required by ifrs 3 it should be noted that certain fair value adjustments
and the value of contingent consideration have necessarily been prepared on a provisional basis due to the recent timing of certain acquisitions
and the periods over which contingent consideration may become payable experience may result in revisions to fair values in the subsequent
accounting period
accounting policy and fair value adjustments principally arise from
1 elimination of goodwill existing in balance sheets at acquisition and inclusion of the fair value of ifrs 3 business combination intangible assets
comprising principally brands note 10
2 fair valuation of property plant and equipment principally relating to ship assets in sunshine cruises
3 accounting policy alignment for revenue recognition and associated operating costs
4 recognition of deferred taxation liabilities relating to other adjustments including intangible assets recognised
5 provision for onerous lease contract on zegrahm expeditions inc
the consideration payable is made up of
£m
cash 67
deferred consideration 1
contingent consideration 20
loan notes issued 2
90
expenses 2
total consideration 92
tui travel plc annual report  accounts 2009 99
wwwtuitravelplccom b cash flows arising in respect of acquisitions
t otal cash flows relating to acquisitions in the year including amounts paid in respect of deferred and contingent consideration arising on prior
period acquisitions are as follows
2009 2009
maximum paid
£m £m
acquisitions in the year 67 67
deferred and contingent consideration arising and loan notes issued 23 –
acquisition expenses paid in the year 22
total consideration 92 69
cash acquired with acquisitions 34
cash paid relating to prior period acquisitions excluding loan notes 13
net cash outflow in the year relating to acquisitions 48
maximum consideration payable represents the maximum consideration that the group would be obliged to pay if all contingent consideration
were to become due
movements in deferred and contingent consideration in the year were as follows
deferred contingent loan
consideration consideration notes t otal
£m £m £m £m
at 1 october 2008 29 40 8 77
recognised in the year relating to current year acquisitions 1 20 2 23
adjustments to amounts recognised in respect of prior period acquisitions – 10 – 10
cash paid 11 2 6 19
foreign exchange 1326
at 30 september 2009 20 51 6 77
further details of deferred and contingent consideration payable in less than one year and after more than one year is given in notes 20 and 
22 respectively
the contingent consideration payable arising in the year is in respect of the acquisitions listed below it is dependent on the results of the
businesses over the following periods or the balance of working capital at the acquisition date and the directors believe the amounts provided
reflect the most likely outcome in each case
basis of period for
calculation calculation maximum
of contingent of contingent contingent
acquisition consideration consideration consideration
sport abroad uk limited earnings up to 9 oct 2011 gbp 1m
master yachting gmbh earnings up to 31 dec 2013 eur 1m
adventure t ours australia group pty limited earnings up to 30 sep 2010 aud 7m
williment world travel limited earnings up to 31 dec 2011 nzd 14m
zegrahm expeditions inc earnings up to 31 dec 2011 usd 11m
eac language centres uk limited earnings up to 30 sep 2010 gbp 3m
total contingent consideration recognised in respect of current year acquisitions gbp 20m
c residual goodwill
a consistent process is undertaken at each acquisition to identify the fair value of separable assets and liabilities acquired including the fair value
of intangible assets being brands order books licences customer relationships and other intangible assets the residual goodwill on acquisition
represents the value of assets and earnings that do not form separable assets under ifrs 3 but nevertheless are expected to contribute to the
future results of the group
residual goodwill in respect of current year acquisitions represents principally
• market knowledge of particular geographic areas
• knowledge of particular market segments for example sports travel and language training
• involvement of existing management and employees and transfer of their knowledge of the operation of the business model
• integration synergies particularly within uk mainstream and the activity sector and
• the ability to sell acquired product through existing channels and existing product through acquired channels in all sectors
100 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
d consolidated income statement
if the businesses that were acquired at various times during the year ended 30 september 2009 had been part of the group since 1 october
2008 group revenue and loss after tax would have been increased by £38m and £2m respectively including amortisation of business combination
intangibles net of tax
the acquired businesses contributed revenues of £141m and profit after tax including amortisation of business combination intangibles of £6m
e acquisitions post balance sheet date
subsequent to 30 september 2009 the group has acquired select world pty ltd for a total maximum consideration of aud 14m gbp 8m 
the accounting under ifrs 3 revised for this acquisition has not yet been finalised
f prior period revisions to fair values
in the year ended 30 september 2008 the group acquired various businesses for a total consideration of £109m the finalisation of the
acquisition balance sheets for these businesses has not led to revisions to the fair values that were presented in the 2008 accounts and therefore
no restatement of the results to 30 september 2008 or balance sheet as at 30 september 2008 has been presented in these accounts
14 deferred tax assets and liabilities
assets liabilities net
30 september 30 september 30 september 30 september 30 september 30 september
2009 2008 2009 2008 2009 2008
intangible assets 26 3 212 190 186 187
finance lease transactions 1 12 25 – 24 12
property plant and equipment 81 11 44 14 37 3
receivables and other assets 5 4 5 8 – 4
financial instruments and foreign exchange 85 27 80 50 5 23
inventories 4 6 – – 4 6
interestbearing loans and borrowings 46 6 10 7 36 1
retirement benefits 117 62 – 4 117 58
other short term temporary differences 93 57 45 9 48 48
t ax value of losses carried forward 77 64 – – 77 64
total 535 252 421 282 114 30
set off of deferred tax within the same jurisdiction 324 47 324 47 – –
net tax assetsliabilities 211 205 97 235 114 30
the group has recognised deferred tax assets relating to tax losses in individual tax jurisdictions based on forecast future taxable profits
unrecognised deferred tax assets
deferred tax assets have not been recognised in respect of the following items reported at the applicable tax rate
30 september 30 september
2009 2008
£m £m
capital losses 42 3
other losses 147 142
total losses 189 145
these assets have not been recognised principally because the directors are not certain of the timing of any benefits that might arise in the
future these losses are not subject to time expiry and are available for utilisation against profits arising in future periods in the territories in
which they have arisen there are no other unprovided deferred tax liabilities nor unrecognised deferred tax assets
tui travel plc annual report  accounts 2009 101
wwwtuitravelplccom movements in temporary differences during the current year
balance at recognised recognised balance at
1 october arising on charged in charged in foreign 30 september
2008 acquisition income equity exchange 2009
£m £m £m £m £m £m
intangible assets 187 1 15 1 14 186
finance lease transactions 12 – 35 – 1 24
property plant and equipment 3 – 41 – 1 37
receivables and other assets 4 – 3 – 1 –
financial instruments and foreign exchange 23 – 10 39 1 5
inventories 6 – 2 – – 4
interestbearing loans and borrowings 1 – 39 – 2 36
employee benefits 58 – 7 65 1 117
other short term temporary differences 48 1 2 – 3 48
t ax value of losses carried forward 64 – 17 – 4 77
total 30 2 59 105 18 114
movements in temporary differences during the prior year are analysed as follows
balance at recognised recognised balance at
1 october arising on charged in charged in foreign 30 september
2007 acquisition income equity exchange 2008
£m £m £m £m £m £m
intangible assets 190 18 22 – 1 187
finance lease transactions 7 – 3 – 2 12
property plant and equipment 32 – 32 – 3 3
receivables and other assets 2 – 1 – 1 4
financial instruments and foreign exchange 42 – 4 58 3 23
inventories 5 – – – 1 6
interestbearing loans and borrowings 3 – 1 – 1 1
employee benefits 59 – 3 4 6 58
other short term temporary differences 57 – 12 – 3 48
t ax value of losses carried forward 41 – 17 – 6 64
t otal 16 18 55 62 11 30
intangible asset temporary differences arise in respect of assets recognised on acquisition property plant and equipment temporary differences
principally relate to tax depreciation in the uk france and germany employee benefits temporary differences arise in respect of defined benefit
pension scheme liabilities and future deductions available on the vesting of employee awards financial instruments and foreign exchange
temporary differences arise in respect of financial instruments accounted for under ias 39 and principally reflect the fair value at 30 september
2009 of cash flow hedging derivatives that will be settled against future transactions other short term temporary differences relate to operating
expenses and related accruals and provisions for which a tax deduction has not yet been recognised
15 inventories
30 september 30 september
2009 2008
£m £m
marine inventories 17 16
airline spares and operating equipment 21 20
other operating inventories 13 15
total 51 51
no inventory amounts are expected to be recovered after more than 12 months
the writedown of inventories to net realisable value amounted to £3m 2008 £1m the writedowns in 2009 and 2008 are both included within
underlying operating profit in cost of sales
102 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
16 trade and other receivables
30 september 2009 30 september 2008
current noncurrent total current noncurrent t otal
assets assets assets assets assets assets
£m £m £m £m £m £m
trade receivables 658 – 658 630 – 630
amounts owed by related parties 26 – 26 133 2 135
other receivables 266 43 309 340 98 438
950 43 993 1103 100 1203
prepayments 586 151 737 550 110 660
total 1536 194 1730 1653 210 1863
the maximum exposure to credit risk for total loans and receivables at the reporting date by geographic region was
30 september 30 september
2009 2008
£m £m
united kingdom 276 287
germany 132 184
france 132 174
other european countries 331 385
rest of the world 122 173
total 993 1203
trade and other receivables are disclosed net of provisions for bad and doubtful debts an analysis of which is shown below
30 september 30 september
2009 2008
£m £m
balance at the beginning of the year 36 35
foreign exchange 10 2
charge to the consolidated income statement 23 1
utilisation of provision 10 –
total 59 36
the ageing of trade receivables at the balance sheet date was
30 september 
30 september 2009 2008
gross provision net gross
£m £m £m £m
not overdue 750 1 749 1016
overdue 1 – 30 days 125 8 117 115
overdue 31 – 90 days 50 3 47 53
overdue 91 – 180 days 20 3 17 34
overdue more than 180 days 107 44 63 21
1052 59 993 1239
provisions for bad and doubtful debts 36
total 993 1203
no individually material bad debt provision movements or changes have been recorded in the year based on past experience and the post
balance sheet period to the date of these consolidated financial statements the group considers that the impairment allowance recorded is
adequate within the impairment allowance there are no individually material amounts held trade receivables not overdue and not impaired
include amounts due from travel agencies tour operators and hoteliers in respect of mainstream specialist  emerging markets activity and
accommodation  destinations sectors credit exposure to individual passengers booking holidays directly is limited by the group’s policy that
full payment is required before the issue of tickets and holiday departure
tui travel plc annual report  accounts 2009 103
wwwtuitravelplccom 17 cash and cash equivalents
30 september 30 september
2009 2008
£m £m
cash in hand 34 12
cash at bank 304 396
deposits 452 722
cash and cash equivalents 790 1130
cash and cash equivalents includes £60m 2008 £46m that is not available for immediate use by the group this is made up of monies held to
meet regulatory requirements plus cash balances on short term deposits held on a restricted basis by the group’s captive insurance funds as part
of their ongoing operations
other current investments disclosed on the consolidated balance sheet comprise deposit balances held to meet regulatory requirements with a
term exceeding three months
18 assets classified as held for sale
30 september 30 september
2009 2008
£m £m
yachts and motor boats 4 3
land and buildings 9 1
aircraft 16 126
disposal groups – assets 93 24
other 4 3
total assets classified as held for sale 126 157
disposal groups – liabilities 59 22
net assets classified as held for sale 67 135
the disposal group assets and liabilities held for sale comprise the canadian mainstream business at 30 september 2009 and société
d’investissement aérien sa jet4you at 30 september 2009 and 30 september 2008 jet4you is included within the western europe segment
and the canadian mainstream business is included in the northern region the canadian mainstream business is classified as held for sale on 
the basis of the announced joint venture transaction with sunwing travel group inc jet4you is presented as held for sale at the current and 
prior year end based on the active disposal process for the business which is progressing and which the directors expect to complete within 
12 months
aircraft held for sale relate to the northern europe and central europe mainstream segments in the year ended 30 september 2009 an
impairment charge of £1m 2008 £31m has been taken to record these property plant and equipment assets at the lower of their carrying
value and fair value less costs to sell the impairment charge is included within separately disclosed restructuring expenses and aircraft items
note 3
during the prior year four aircraft were purchased but were not sold and leased back until the first quarter of the current year ended 
30 september 2009 the four aircraft were therefore classified as held for sale at 30 september 2008 until their disposal for a total of £90m 
in the current year the disposal proceeds are included within ‘proceeds from sale of property plant and equipment’ on the consolidated cash
flow statement
assets held for sale are expected to be sold within 12 months
19 interestbearing loans and borrowings
30 september 30 september
2009 2008
£m £m
current liabilities
amounts owed to related parties 229 –
bank loans and overdrafts 31 31
loan notes 3 3
finance leases and hire purchase contracts 25 20
other financial liabilities 39 45
total 327 99
other financial liabilities comprise the fair value of two put options written by the group to the sole remaining minority shareholder in l’tur
t ourismus ag l’tur that may require the group to purchase the minority shareholding during the year the group increased its shareholding
from 51 to 70 on the exercise of part of one of the options the remainder of this put option over 20 of the shares may be exercised at any
time until 2015 a further put option at a fixed price with no time limit has been written by the group during the year to the same minority
shareholder for the remaining 10 shareholding
104 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
fair value changes in the put option liability are included within financial expenses or financial income
30 september 30 september
2009 2008
£m £m
noncurrent liabilities
amounts owed to related parties 611 840
bank loans 20 154
loan notes 3 6
finance leases and hire purchase contracts 167 167
total 801 1167
30 september 30 september
2009 2008
£m £m
the bank loans and loan notes are repayable
within one year 34 34
between one and five years 23 156
after five years – 4
total 57 194
certain loans are secured on the underlying assets of the company in whose name the borrowings are made
at 30 september 2009 and 30 september 2008 the related party loans were all repayable within five years
finance lease liabilities relate primarily to the leasing of aircraft and boats group obligations under finance leases and hire purchase contracts are
payable as follows
minimum minimum
lease lease
payments payments
30 september 30 september
principal interest 2009 principal interest 2008
£m £m £m £m £m £m
in respect of aircraft yachts and equipment payable within
one year 25 8 33 20 9 29
one to five years 164 6 170 158 15 173
after five years 3– 3 9– 9
total 192 14 206 187 24 211
20 current trade and other payables
30 september 30 september
2009 2008
£m £m
trade payables 1363 1142
deferred and contingent consideration note 13b 23 20
other payables 232 233
amounts owed to related parties 134 77
other taxes and social security costs 99 58
accruals and deferred income 1005 1033
client money received in advance 1306 1494
total 4162 4057
tui travel plc annual report  accounts 2009 105
wwwtuitravelplccom 21 provisions for liabilities and charges
aircraft
maintenance restructuring other t otal
£m £m £m £m
at 1 october 2008 204 46 165 415
provided in the year 240 24 93 357
released in the year 15 – 25 40
unwinding of discounted amount 4 – 1 5
costs incurred 188 41 85 314
foreign exchange 916 16
at 30 september 2009 254 30 155 439
analysed as
noncurrent 205 2 43 250
current 49 28 112 189
254 30 155 439
at 30 september 2008
analysed as
noncurrent 154 1 25 180
current 50 45 140 235
204 46 165 415
aircraft maintenance
in respect of aircraft provision is made for maintenance overhaul and repair costs of operating leased airframes engines and certain other
components based on total anticipated costs over the useful economic life of the asset calculated by reference to costs experienced and
published manufacturers’ data the charge to the income statement is calculated by reference to the number of hours and cycles flown and 
by reference to the length of the full overhaul cycle costs incurred are charged against the provision neither the timing nor the value of the
expenditure can be precisely determined but they can be averaged over time and over a fleet
the cost of major overhauls of owned airframes and engines is capitalised and depreciated over the period until the next scheduled 
major overhaul
restructuring
restructuring relates to provisions arising as a result of reorganisation and restructuring plans that are irrevocably committed and includes
severance payments further details of restructuring projects in the current year are set out in note 3
other
other provisions relate to litigation including provisions for contingent liabilities recorded on acquisition of first choice onerous lease contracts
that have been entered into in the ordinary course of business and other future obligations the amount or timing of which is uncertain the
majority of the provision is anticipated to be utilised within 12 months of the balance sheet date while the remainder is expected to be utilised
within one to four years of the balance sheet date although the timing and payments related to individual litigation claims is estimated and is
inherently uncertain
22 noncurrent trade and other payables
30 september 30 september
2009 2008
£m £m
trade payables – 1
deferred and contingent consideration note 13b 48 49
other payables 5 6
accruals and deferred income 55 93
total 108 149
106 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
23 share capital
30 september 30 september
2009 2008
£m £m
authorised
1999500020 2008 1999500020 ordinary shares of 10p each 200 200
49998 2008 49998 redeemable preference shares of £1 each – –
total 200 200
allotted called up and fully paid
1118010670 2008 1118010670 ordinary shares of 10p each 112 112
total 112 112
as described more fully in note 35 the ultimate parent company tui ag is the beneficial owner of 5254 of the company’s issued ordinary
share capital
from time to time the company purchases its own shares on the market the timing of these purchases depends on market prices primarily the
shares are intended to be used for issuing shares under the company’s share award programme buy and sell decisions are made on a specific
transaction basis by the board the company does not have a defined share buyback plan
24 capital and reserves
retained
share merger translation hedging earnings equity holders minority
capital reserve reserve reserve deficit of parent interest t otal
£m £m £m £m £m £m £m £m
at 1 october 2007 112 2490 45 107 83 2623 7 2630
t otal recognised incomeexpense for the year – – 187 134 271 50 5 55
sharebased payment –––– 14 14 – 14
acquisition of own shares –––– 7 7 – 7
acquisition in stages –––– 8 8 – 8
dividends –––– 65 65 5 70
acquisition of minority interest –––– 16 16 2 18
at 30 september 2008 112 2490 232 27 270 2591 5 2596
t otal recognised incomeexpense for the year – – 128 102 231 205 2 203
sharebased payment –––– 16 16 – 16
dividends –––– 107 107 3 110
acquisition of minority interest –––– 12 12 1 13
at 30 september 2009 112 2490 360 75 604 2283 3 2286
merger reserve
the merger reserve arose on the business combination of tui travel plc tui travel first choice holidays plc first choice and the t ourism
division of tui ag on 3 september 2007 the merger reserve is nondistributable
acquisition of minority interest
during the year ended 30 september 2009 the group acquired a proportion of the minority interest shareholding in respect of a number of
subsidiaries the principal acquisitions were in respect of the minority interest shareholdings in l’tur t ourismus ag note 19 tui hellas t ravel
t ourism and airlines ae and tui bulgaria ood
acquisition in stages
equity adjustments in the year ended 30 september 2008 relating to acquisitions in stages were for the group’s acquisition of the remaining 50
shareholding in société polynésienne promotion hotelière a hotel operator within the western europe mainstream sector and the remaining
60 shareholding of jet4you a moroccan airline both were previously equity accounted entities for which a share of net liabilities had not been
recognised under ias 28 and ias 31
acquisition of own shares
during the year ended 30 september 2008 the company purchased its own shares for £7m which was debited to equity the number of shares
held by the employee benefit trust ebt at 30 september 2009 and at 30 september 2008 is disclosed in note 5d the associated cash
outflow was presented as a financing cash flow
other reserves
exchange gains or losses arising on the translation to the group’s reporting currency are recorded in the translation reserve gains or losses
arising on cash flow hedges are initially recorded in the hedging reserve and are recycled to the consolidated income statement in accordance
with the accounting policy in note 1f
the group also has a capital reserve of £01m at 30 september 2009 2008 £01m and a revaluation reserve of £02m 2008 £02m 
the capital reserve is nondistributable
tui travel plc annual report  accounts 2009 107
wwwtuitravelplccom 25 financial instruments
a treasury risk overview
the group is exposed to a variety of financial risks
• market risk in respect of foreign currency rate risk fuel price risk and interest rate risk
• liquidity risk in respect of the group’s ability to meet its liabilities
• credit risk in respect of recovery of amounts owing to the group and
• capital risk in respect of its capital structure and cost of capital
the group’s key financial market risks are in relation to foreign currency rates and jet fuel price currency risk results from the substantial 
crossborder element of the group’s trading and arises on sales purchases and borrowings that are denominated in a currency other than the
functional currencies of individual group businesses the risk is managed by the use of foreign exchange forward swap and option contracts 
the group’s exposure to jet fuel prices results from the aircraft fleet operations and is managed using commodity swaps and options
the group is exposed to interest rate risk that arises principally from the group’s floating rate aircraft leases and floating rate bank loans and
cash balances certain finance leases and loans have fixed interest rates
credit risk liquidity risk and capital risk are considered in notes 25d 25f and 25k respectively
the board of directors has overall responsibility for the establishment and oversight of the group’s risk management framework and to ensure
that the group has adequate policies procedures and controls to successfully manage the financial risks that it faces these form part of the
group’s overall risk management framework
incorporated within the framework’s terms of reference are the determination of all treasury policies and the monitoring of the effectiveness of
those policies group treasury implements the agreed policies on a daytoday basis the procedures also stipulate the levels of authority applied
to dealing and to approving the types of hedging financial instrument used to manage these exposures transactions are only undertaken to
hedge underlying exposures financial instruments are not traded nor are speculative positions taken
the treasury position of the group including liquidity foreign exchange and fuel hedging exposure is managed centrally in accordance with
policies appropriate to cover specific risks faced by each business unit and is the responsibility of the chief financial officer and group treasurer
group treasury conducts regular reviews of financial risks with business unit management teams and receives regular cash flow forecasts from
each business unit to ensure hedges match the currency or fuel requirements of each operating business reports and forecasts for the group
showing hedges and forecast requirements are submitted monthly to the group management board and to each board meeting of tui travel plc
in line with its established policy the group has monitored throughout the year its counterparty exposure with individual financial institutions
such counterparty risk can arise by way of cash deposited or derivative instruments traded
b currency risk management
the group is exposed to currency risk on sales purchases and borrowings that are denominated in a currency other than the functional
currencies of individual group businesses which are principally sterling euro us dollar canadian dollar and swedish krona
the group hedges its foreign currency exposures on a seasonal basis that is winter season and summer season with each season comprising 
a sixmonth period at the start of a season the group will have hedged substantially all of its foreign currency exposure forecast sales and
purchases and related assets and liabilities for that season using predominantly forward exchange contracts most with a maturity of less than
one year from the reporting date
in respect of other monetary assets and liabilities denominated in foreign currencies the group ensures that its net exposure is kept to an
acceptable level principally by using forward contracts in respect of nonsterling denominated airline maintenance provision balances loan
balances and deposits
the group publishes its consolidated financial statements in sterling and as a result it is also subject to foreign currency exchange translation 
risk in respect of the translation of the results and underlying net assets of its foreign operations into sterling
the following significant exchange rates to the group’s sterling presentation currency excluding the impact of hedged transactions are
illustrative of the rates applied during the current and prior year
average rate midspot rate
year ended year ended
30 september 30 september 30 september 30 september
£1 gbp equivalent 2009 2008 2009 2008
us dollar 1560 1992 1600 1801
euro 1149 1324 1094 1256
canadian dollar 1822 1991 1717 1885
swedish krona 12101 12374 11181 12301
as at 30 september 2009 the group has hedged forecast transactions for 35bn and €12bn for periods up until winter 2010 principally relating
to winter 2009 and summer 2010
108 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
c commodity risk
fuel commodity risk arises from the group’s operation of aircraft in europe and canada
the group hedges its fuel commodity exposures on a seasonal basis being the winter and summer season with each season comprising a 
sixmonth period at the start of a season the group will have hedged substantially all of its fuel commodity exposure for that season using
predominantly commodity swaps or options most with a maturity of less than one year from the reporting date
as at 30 september 2009 the group has hedged transactions for fuel of 18m metric tonnes 2008 20m metric tonnes for periods up until
winter 2010
during the prior year the group paid premiums on swaption and option instruments in order to manage short term volatility in respect of 
fuel hedging whilst still continuing to apply the group’s documented hedging policies the charge for these option premiums is included in 
the comparative year’s separately disclosed items within cost of sales as it arose directly as a result of the exceptional fuel price volatility 
during 2008
details of fuel forward derivative instruments are set out in note 25i
d credit risk
credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the group credit risk arises
from cash balances including bank deposits and cash and cash equivalents and derivative financial instruments as well as credit exposures to
customers including outstanding receivables financial guarantees and committed transactions credit risk is managed separately for treasury and
operating related credit exposures
the group minimises its financial credit risk through the application of risk management policies approved and monitored by the board while
counterparties are limited to major banks and financial institutions group policy ensures that individual counterparty limits are adhered to and
that there are no significant concentrations of credit risk the group monitors the credit ratings of its counterparties where applicable as part of
its ongoing assessment of its credit exposure financial instruments are only transacted with major financial institutions with strong credit ratings
of a1p1
loans and other receivables exposures are managed locally in the operating units where they arise and credit limits are set as deemed
appropriate for the customer there is no material concentration of credit risk with respect to trade and other receivables as the group has a large
number of internationally dispersed customers
the carrying amount of financial assets represents the maximum credit exposure the maximum exposure to credit risk at the balance sheet 
date was
carrying value carrying value
30 september 30 september
2009 2008
£m £m
trade and other receivables note 16 993 1203
cash and cash equivalents note 17 790 1130
derivatives – contracts used for hedging 284 321
trade and listed investments note 12 47 23
other investments note 17 36 29
total 2150 2706
trade and other receivables exclude prepaid accommodation and other prepayments which do not meet the definition of a financial instrument
the maximum exposure to credit risk for total trade and other receivables at the balance sheet date and by geographic region as well as their
ageing is disclosed in note 16
cash cash equivalents and other investments principally comprise money market deposits and other short term investments the investments
are with counterparties with a strong credit rating of a1p1 at 30 september 2009 approximately 51 2008 48 of the group’s unrestricted
cash and cash equivalents were invested with counterparties based in the united kingdom
in addition the group makes prepayments for hotel accommodation whilst such prepayments do not meet the definition of a financial asset
under ias 39 such prepayments give rise to a risk similar to credit risk due to the inherent risk of the group not recovering the prepayment
through full delivery of the related goods and services prepayments from time to time can concentrate risk with specific counterparties which 
are based overseas the carrying amount of prepayments which are presented within current and noncurrent assets forms the maximum credit
exposure before taking into account any security or collateral held by the group where appropriate the group obtains security collateral over
the related accommodation property to mitigate credit risk the group leases out aircraft on operating leases on a short term seasonal basis
principally over the winter season lease income recognised in the year was £18m 2008 £6m subsequent to the year end on 24 october
2009 the group commenced the long term wet lease to air berlin plc of 13 aircraft for an initial term of 10 years at 30 september 2009
prepaid accommodation which is recoverable after more than one year was £151m 2008 £89m
tui travel plc annual report  accounts 2009 109
wwwtuitravelplccom e interest rate risk
the group has exposure to interest rate risk arising principally on sterling us dollar and euro floating interest rates that are attached to the
group’s floating rate aircraft leases and floating rate bank loans and cash balances
the group does not account for any fixed rate financial liabilities at fair value through profit and loss and the group does not designate
derivatives interest rate swaps as hedging instruments under a fair value hedge accounting model
the group’s loans and borrowings are measured at amortised cost with the exception of put option liabilities which are carried at fair value
face value face value
and carrying and carrying
amount amount
30 september 30 september
2009 2008
financial instrument currency nominal interest rate year of maturity £m £m
shareholder loan eur 30 2011 840 840
secured bank loans sterling 2262 20102018 19 24
eur 5160 20092015 1 1
usd 14 2011 9 9
unsecured bank loans usd na na – 132
eur 1957 20092018 22 19
51 185
finance leases eur 2664 20102015 187 180
usd 55 20112013 2 5
mad 5965 2014015 2 2
aud 72118 20092012 1 –
192 187
loan notes sterling 14 20102011 1 3
usd 5060 20102011 4 6
nzd 70 20092010 1 –
6 9
put option liabilities eur 50 current 39 45
total interestbearing liabilities 1128 1266
analysed between
fixed rate instruments 215 208
variable rate instruments 913 1058
1128 1266
f liquidity risk
liquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due the group’s approach is to ensure that 
it will have sufficient liquidity to meet its liabilities when due under both normal and stressed circumstances
the group’s liquidity peaks in july and august during the european summer holiday season with the liquidity low point being in december and
january t o manage the liquidity position the group is able to draw cash advances under its existing bank facilities which principally comprise two
main sources of long term debt funding
i the shareholder loan from tui ag of €919m which is fully drawn and is repayable on 1 april 2010 €250m 1 december 2010 €509m and 
30 april 2011 €160m and
ii the external bank revolving syndicated credit facilities totalling £910m 2008 £770m plus a bonding and letter of credit facility of £40m 
2008 nil which mature in june 2012 and september 2010 respectively from these facilities £144m has been utilised for letter of credit
purposes at 30 september 2009 2008 £224m
the group’s external bank revolving credit facility was increased by £140m with effect from 30 september 2009 the external bank revolving
credit facility is used to manage the seasonality of the group’s cash flows and liquidity cash positions liquidity and available facility headroom 
are monitored daily by the group treasury department
in addition to the above facilities the group issued a £350m convertible bond due 2014 on 1 october 2009 which was settled on 5 october
2009 the coupon has been set at 60 per annum and the conversion price has been set at 3493p per share which represents a premium 
of 330 over the volume weighted average price of tui travel plc’s ordinary shares from launch to pricing
110 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
the board remains satisfied with the group’s funding and liquidity position fixed charges cover and the ratio of net debt to ebitda which the
board believes to be the most useful measures of cash generation and gearing as well as being the main basis for covenants in our external
credit facilities were met at the year end and throughout the year fixed charges cover is defined as earnings before interest tax depreciation
amortisation and operating lease rentals charge ebitdar divided by net interest plus operating lease rentals ebitda is defined as earnings
before interest tax depreciation and amortisation both covenants are measured on an ‘underlying basis’ as defined in note 1bii
in respect of the delivery of new aircraft the group’s established strategy is to refinance new aircraft in advance of their delivery dates and
therefore the group does not forecast to use internal cash resources for new aircraft purchases details of aircraft purchase commitments at the
year end are given in note 28
the following are the undiscounted contractual cash flows of financial liabilities including interest payments calculated using interest rates in force
at each balance sheet date
carrying contractual within 12 25 more than
amount cash flows 1 year years years 5 years
30 september 2009 £m £m £m £m £m £m
nonderivative financial liabilities
shareholder loan 840 865 249 616 – –
secured bank loans 29 31 6 10 15 –
unsecured bank loans 22 27 15363
finance leases 192 206 33 147 23 3
loan notes 67511 –
other financial liabilities 39 39 39–––
trade and other payables 2831 2831 2800 31 – –
derivative financial liabilities
contracts used for hedging 302 348 307 38 3 –
total 4261 4354 3454 846 48 6
carrying contractual within 12 25 more than
amount cash flows 1 year years years 5 years
30 september 2008 £m £m £m £m £m £m
nonderivative financial liabilities
shareholder loan 840 998 52 53 893 –
secured bank loans 34 42 8 7 15 12
unsecured bank loans 151 186 8 9 151 18
finance leases 187 211 29 30 143 9
loan notes 9963 – –
other interestbearing liabilities 45 45 45 – – –
trade and other payables 2607 2607 2554 53 – –
derivative financial liabilities
contracts used for hedging 228 211 166 37 8 –
t otal 4101 4309 2868 192 1210 39
the actual repayment of revolving credit facilities will vary the timing reflected in the tables is based on the first date that the group can be
required to settle the liability
trade and other payables exclude customers monies received in advance deferred income and deferred and contingent consideration
at 30 september 2009 the group had available undrawn committed borrowing facilities of £806m 2008 £546m comprising letters of credit
guarantees and revolving floating rate credit facilities for cash borrowings any noncompliance with covenants underlying the group’s financing
arrangements could if not waived constitute an event of default with respect to any such arrangements the group was in full compliance with
its financial covenants throughout each of the periods presented undrawn facilities presented below exclude the group’s £350m 6 convertible
bond issued on 1 october 2009
undrawn facilities throughout all years presented are analysed as follows
30 september 30 september
2009 2008
£m £m
expiring
within one year 40 –
in more than one year but less than five years 766 546
total 806 546
tui travel plc annual report  accounts 2009 111
wwwtuitravelplccom g analysis of total financial assets and financial liabilities
the tables below set out the group’s ias 39 classification for each of its financial assets and liabilities
held for available loans and amortised total
trading for sale receivables cost carrying value
at 30 september 2009 £m £m £m £m £m
cash and cash equivalents – – 790 – 790
borrowings due within one year – – – 288 288
borrowings due after more than one year – – – 801 801
derivative assets 284––– 284
derivative liabilities 302 – – – 302
other financial assets – 47 1029 – 1076
other financial liabilities 39 – – 2831 2870
total 57 47 1819 3920 2111
held for available loans and amortised t otal
trading for sale receivables cost carrying value
at 30 september 2008 £m £m £m £m £m
cash and cash equivalents – – 1130 – 1130
borrowings due within one year – – – 54 54
borrowings due after more than one year – – – 1167 1167
derivative assets 321 – – – 321
derivative liabilities 228 – – – 228
other financial assets – 23 1232 – 1255
other financial liabilities 45 – – 2607 2652
total 48 23 2362 3828 1395
other financial assets comprise trade receivables other receivables which are receivable within and after more than one year as well as other
investments due within one year other financial liabilities comprise trade payables accruals and other financial liabilities which are payable within
and after more than one year
interest payable on financial instruments carried at amortised cost comprising bank loans loans from parent and finance lease liabilities is
disclosed in note 4
derivatives presented under held for trading under ias 39 classifications are analysed between cash flow hedges and economic hedges in note 25i
h fair values of financial assets and financial liabilities
the fair values of financial assets and liabilities together with carrying amounts shown in the consolidated balance sheet at 30 september 2009
and at 30 september 2008 are as follows
30 september 2009 30 september 2008
carrying fair carrying fair
amount value amount value
£m £m £m £m
cash and cash equivalents 790 790 1130 1130
borrowings
shareholder loan 840 840 840 840
bank loans 51 51 185 185
loan notes 6 6 9 9
finance lease liabilities 192 188 187 179
derivative financial instruments
forward exchange contracts used for hedging
– assets 271 271 264 264
– liabilities 173 173 112 112
commodity contracts used for hedging
– assets 13 13 57 57
– liabilities 129 129 116 116
other financial assets
trade receivables 993 993 1203 1203
trade and listed investments 47 47 23 23
other investments 36 36 29 29
other financial liabilities
other financial liabilities 39 39 45 45
trade and other payables 2800 2800 2554 2554
other long term payables 31 31 53 53
total 2111 2107 1395 1387
the basis for fair value measurement of financial assets and liabilities is set out in note 1y to the consolidated financial statements
112 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
i derivative instruments
at the balance sheet date the fair value of the group’s derivative financial assets and liabilities was as follows
30 september 2009 30 september 2008
assets liabilities total assets liabilities t otal
fair fair fair fair fair fair
value value value value value value
£m £m £m £m £m £m
cash flow hedges
foreign exchange forwards 238 167 71 229 87 142
foreign exchange options – 1 1 20 4 16
commodity options 3 13 10 15 16 1
commodity swaps 10 116 106 42 100 58
251 297 46 306 207 99
economic hedges
foreign exchange forwards 33 5 28 15 21 6
total 284 302 18 321 228 93
analysed as
current 271 284 13 273 178 95
noncurrent 13 18 5 48 50 2
total 284 302 18 321 228 93
all derivatives are held as cash flow hedges or to offset changes in the value of items recognised in the consolidated balance sheet speculative
positions are not undertaken
the following table indicates the periods in which the cash flows associated with derivatives which are principally cash flow hedges are expected
to occur
projected cash flows
less than between between over
1 year 1 and 2 years 2 and 5 years 5 years
30 september 2009 £m £m £m £m
derivative financial assets
foreign exchange forwards 252 11 – –
commodity swaps 5–––
257 11 – –
derivative financial liabilities
foreign exchange forwards 148 14 2 –
commodity options 27 2 – –
commodity swaps 132 22 1 –
307 38 3 –
total 50 27 3 –
projected cash flows
less than between between over
1 year 1 and 2 years 2 and 5 years 5 years
30 september 2008 £m £m £m £m
derivative financial assets
foreign exchange forwards 194 37 51 –
foreign exchange options 3 – – –
commodity options 8–––
commodity swaps 42 2 – –
247 39 51 –
derivative financial liabilities
foreign exchange forwards 68 19 8 –
commodity options 8 3 – –
commodity swaps 90 15 – –
166 37 8 –
total 81 2 43 –
ineffectiveness
ineffectiveness in respect of cash flow hedges has been recognised in the income statement for the year ended 30 september 2009 ineffectiveness
in the year ended 30 september 2009 comprised £5m 2008 £7m relating to fuel hedging and this is included within underlying operating profit
tui travel plc annual report  accounts 2009 113
wwwtuitravelplccom aircraft order book derivatives
in november 2008 us dollar cash flow hedges in connection with the group’s aircraft order books were fully unwound and settled early in a
planned process this early settlement which resulted in a net cash gain has arisen because post the business combination forming tui t ravel
plc the board has determined the group’s asset ownership strategy is ‘asset right’ in terms of aircraft ownership and financing this means that
the group’s preferred solution is to sell and leaseback new aircraft under operating leases at the time of delivery consequently payments for 
new aircraft in us dollars are now planned to be funded by way of proceeds from sale and leaseback transactions and future us dollar currency
requirements are not required to be forward hedged
the cumulative gain on aircraft order book derivatives from the period when these hedges were effective up until the termination of these
hedges is recognised in the hedging reserve net gains relating to aircraft orders delivered or cancelled in the year comprising 10 boeing 787s
have been recycled to the income statement immediately and are recorded in separately disclosed items note 3 a remaining amount of £11m
net of deferred taxation remains in reserves and will be recycled to match the delivery of the related aircraft
j amounts recognised directly in equity
the following amounts have been recognised directly in equity during the year
year ended year ended
30 september 30 september
2009 2008
£m £m
hedging reserve
effective portion of changes in fair value of cash flow hedge 60 163
fair value of cash flow hedges transferred to the consolidated income statement 81 37
141 200
translation
foreign currency translation differences for foreign operations recorded 
in the consolidated statement of recognised income and expense 129 180
net creditcharge to equity 12 380
k capital management
the board’s policy has been to maintain a strong capital base in order to maintain investor creditor and market confidence and to sustain future
development of the business the group has a roadmap to deliver sustainable long term value to shareholders with a return on invested capital
greater than the group’s weighted average cost of capital progress in achieving this objective has been made during this year by improving
underlying operating margins from 29 to 32 which increases return on invested capital roic to 92 2008 84
roic is defined as ‘underlying nopat’‘average invested capital’
underlying nopat is underlying net operating profit less a tax charge at the effective annual rate
‘underlying’ as a measure of operating profit is defined in note 1bii
average invested capital comprises an average of the net assets at the start and end of the year of the group adjusted to add back net debt
cumulative goodwill impairment charges and defined benefit pension scheme net deficits there is also an adjustment to adjust net debt to
reflect a seasonal average cash balance calculations for the current and prior years are
year ended year ended
30 september 30 september
2009 2008
note £m £m
underlying operating profit consolidated income statement 443 398
t axation at the underlying effective rate of 28 – 124 111
underlying nopat 319 287
net assets consolidated balance sheet 2286 2596
net debt 26 338 136
adjustment for seasonal cash balances – 300 300
cumulative goodwill impairment charge 2009 sunsail clubs £7m2008 tuifly £112m 10 119 112
defined benefit pension net deficit 5c 500 253
invested capital 3543 3397
average invested capital 3470 3430
roic 92 84
114 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
the board seeks to maintain a balance between the levels of debt borrowings undertaken and the advantages and security afforded by a sound
capital position an analysis of net debt at the year end is in note 26
certain subsidiaries have external capital requirements as a result of applicable travel industry regulations in their jurisdictions compliance 
with these regulations is mandatory for the relevant operating businesses in those countries in order that they are able to continue trading 
key countries with such mandatory capital requirements are france belgium the netherlands germany canada and australia the capital
requirements in these countries comprise maintaining minimum equitynet asset levels in operating subsidiaries all such capital requirements
were complied with as at 30 september 2009 none of these requirements are individually or collectively significant to the overall group and 
do not place any significant restriction on the group’s funding or operations
l sensitivity analysis
the sensitivity analysis is for illustrative purposes only and should not be considered a projection of likely future events and gains or losses
the sensitivity analysis includes the following assumptions
• changes in market interest rates only affect interest income or expense of variable financial instruments
• changes in market interest rates only affect interest income or expense in relation to financial instruments with fixed interest rates if these are
recognised at fair value
• changes in market interest currency and fuel rates affect the fair value of derivative financial instruments designated as hedging instruments
and all hedges are expected to be highly effective and
• changes in the fair value of derivative financial instruments and other financial assets or liabilities are estimated by discounting the future cash
flows to net present values using appropriate market rates prevailing at the year end
the group has used a sensitivity analysis technique that measures the estimated change to the income statement and equity of a 1 100 basis
points difference in market interest rates or a 10 strengthening or weakening in sterling against all other currencies and in fuel prices from the
rates applicable at the balance sheet date with all other variables remaining constant
interest rate risk
under the above assumptions a 100bp increase in interest rates would not result in any material change in the consolidated income statement or
equity 2008 £5m
currency risk
similarly under the above assumptions with a 10 strengthening or weakening of sterling against all principal exchange rates loss before tax
would have reduced by £4m september 2008 loss reduced by £24m or increased by £5m 2008 profit increased by £29m respectively
principally relating to the translation of the income statement of overseas subsidiaries equity before tax would have decreased by £376m
2008 £204m or increased by £376m 2008 £249m respectively
fuel price risk
the sensitivity analysis is based on a 10 increase or decrease in fuel prices and the sensitivity will differ correspondingly if the fuel markets are
more or less volatile under these assumptions with a 10 increase or decrease in the unit price of fuel profit before tax would neither increase
nor decrease materially because of the fuel price hedging policy and appropriate pricing adjustments equity before tax would increase by £70m
2008 £108m or decrease by £70m 2008 £142m respectively
m litigation risk
the group has a policy to mitigate the financial risk of litigation and disaster through the use of captive insurance companies and insurance with
third party providers the group’s exposure to risk is capped by single event and aggregate limits with insurance in place for exposures above
these limits
the group provides for outstanding claims including settlement expenses using a consistent methodology based upon historical claims patterns
average claims amounts external legal advice and future expectations
tui travel plc annual report  accounts 2009 115
wwwtuitravelplccom 26 movements in cash and net debt
cashamounts other
and cash due to financial
equivalents related parties bank loans loan notes finance leases liabilities t otal
£m £m £m £m £m £m £m
at 1 october 2007 1959 1400 553 28 178 37 237
cash movement 951 778 400 21 26 – 274
noncash movement – 23 – 1 11 4 39
foreign exchange 122 195 17 1 24 4 119
arising on acquisition – – 15 – – – 15
at 30 september 2008 1130 840 185 9 187 45 136
cash movement 352 91 143 6 22 23 67
noncash movement 4 29 – 2 – 12 11
foreign exchange 16 120 8 1 26 5 144
arising on acquisition – – 1 – 1 – 2
at 30 september 2009 790 840 51 6 192 39 338
noncash movements in respect of other financial liabilities arise from the issue of a put option in respect of minority interest shares note 12
27 operating lease commitments
t otal group obligations under noncancellable operating lease contracts are payable as follows
land aircraft land aircraft
and yachts and and yachts and
buildings equipment buildings equipment
30 september 30 september 30 september 30 september
2009 2009 2008 2008
£m £m £m £m
t otal commitments under noncancellable operating leases expiring
within one year 190 406 153 341
between one and five years 444 962 414 825
later than five years 240 230 275 166
total 874 1598 842 1332
operating lease commitments in respect of land and buildings principally comprise commitments in respect of the group’s retail estate
the future commitment under the group’s floating rate aircraft operating leases at 30 september 2009 was £120m 2008 £34m
the increase in total aircraft lease commitments yearonyear reflects the movement in the us exchange rate since september 2008 and 
the extension of eight leases on the thomson aircraft fleet in total the group operates 128 aircraft on operating leases at 30 september 2009
2008 128 aircraft yachts are held on operating leases in tui marine as part of the group’s sunsail and the moorings fleets
28 capital and other commitments
capital commitments
30 september 30 september
2009 2008
the group’s capital commitments are as follows £m £m
contracted but not provided for 22 60
in addition to the above items at the year end the group had contracted to purchase 50 aircraft with initial deliveries to start in the last quarter
of the calendar year 2010 at list price the total order value was us6156m
on 3 october 2009 a group company signed a contract which cancelled 10 of the aircraft which had been on order the remaining 40 aircraft at
list price have a total order value of us4316m the group intends to refinance these aircraft in advance of their delivery dates and therefore
does not expect to use its own cash resources for their purchase
the group’s joint ventures and associates had no material capital commitments at 30 september 2009 2008 nil
other commitments
on 29 september 2009 the group announced a joint venture transaction with sunwing travel group inc under the terms of the deal tui t ravel
will contribute its canadian operations plus cad101m and sunwing will contribute its operations to the joint venture tui travel will receive a
49 interest in the joint venture with sunwing’s owners receiving 51 the deal is subject to regulatory and competition approvals which are in
the process of being sought
116 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
29 contingent liabilities
the group is at any time defending a number of actions against it arising in the normal course of business provision is made for these actions
where this is deemed appropriate no actions which are outstanding at 30 september 2009 are expected to have a material effect on these
accounts the directors consider that adequate provision has been made for all known liabilities
30 related party transactions
apart from with its own subsidiaries which are included in the consolidated financial statements tui travel plc in carrying out its ordinary
business activities maintained direct and indirect relationships with related parties including consolidated or related companies of its ultimate
parent company tui ag these companies delivered services to companies in the group
the group also undertook transactions with its joint ventures and associated companies these transactions related primarily to incoming
agencies and hotel companies used by the group’s tour operators the income and expenses arising from transactions with associates and joint
ventures are included within the appropriate sector revenue or costs as presented in the segmental analysis
all transactions with related parties were executed on an arms length basis and under normal conditions of trade with independent third parties
shareholder loan
a shareholder loan was advanced to the company by tui ag on 3 september 2007 the loan bears interest at euribor plus a margin currently
15 per annum increasing sixmonthly by 02 to a maximum of 20 per annum the company can make voluntary repayments at any time
during the term of the loan subject to a minimum repayment of €10m and the giving of 30 days’ notice the drawn balance of the loan at 
30 september 2009 was €919m 30 september 2008 €1019m not including accrued interest payable it is repayable in three instalments 
1 april 2010 €250m 1 december 2010 €509m and 30 april 2011 €160m
hotel framework agreement
as part of the relationship arrangements between the company and tui ag at the time of the business combination both parties entered into
the hotel framework agreement which governs the commercial relationship between tui ag and the company in respect of the distribution of
hotel beds forming part of the hotel portfolio interests retained by tui ag under the hotel framework agreement tui deutschland tui travel
german tour operating business continues to have access to the robinson hotel portfolio and to the distribution of such portfolio’s hotel beds 
in europe on the basis of the existing levels of exclusivity and seasonal arrangements between tui deutschland and robinson as practised prior
to the business combination in addition tui deutschland agrees to provide the same services in relation to the distribution of the beds as it 
did prior to the business combination and shall be entitled to use certain robinson trademarks in connection with these services the hotel
framework agreement expires on 31 october 2011 provided that one year prior to such expiry the parties shall discuss in good faith and
endeavour to agree a replacement agreement
trademark licence agreement
the trademark licence agreement incorporates trademark licences granted from tui ag to members of the tui t ourism group in relation to 
tui t ourism’s use of the tui name and logo and other trademarks from within tui ag’s portfolio of trademarks used in the former tui t ourism’s
business licence fees payable under each licence are an annual fee equal to 002 of the average annual gross turnover of the relevant licensee
under the relevant trademarks measured over a threeyear period t otal licence fees charged in the year ended 30 september 2009 were £3m
2008 £3m each licence’s standard terms are for five years with an option for the relevant licensee to extend for a further five years on the
same terms
details of transactions with related parties and balances outstanding at the balance sheet date are set out in the tables below
revenue expenses
year ended year ended year ended year ended
30 september 30 september 30 september 30 september
2009 2008 2009 2008
£m £m £m £m
related party
ultimate parent tui ag 7 4 71 78
hotel and resort subsidiaries of tui ag 5 2 384 349
other subsidiaries joint ventures and associates of tui ag 8 19 63 31
joint ventures and associates of the group 7 18 151 21
total 27 43 669 479
tui travel plc annual report  accounts 2009 117
wwwtuitravelplccom receivables outstanding payables outstanding
year ended year ended year ended year ended
30 september 30 september 30 september 30 september
2009 2008 2009 2008
£m £m £m £m
related party
ultimate parent tui ag 6 107 885 840
hotel and resort subsidiaries of tui ag 1 3 56 52
other subsidiaries joint ventures and associates of tui ag 6 5 14 12
joint ventures and associates of the group 13 20 19 13
total 26 135 974 917
payables outstanding with related parties are reported in notes 19 and 20 and receivables outstanding are reported in note 16
in accordance with ias 24 key management functions within the group and the group management board were related parties whose
remuneration had to be listed separately the compensation paid in respect of key management personnel including directors was as follows
year ended year ended
30 september 30 september
2009 2008
£m £m
short term employee benefits 17 18
postretirement benefits 2 2
sharebased payments 10 7
total 29 27
details of directors’ remuneration are given in the remuneration report
31 key accounting estimates and judgements
the preparation of consolidated financial statements under adopted ifrss requires the group to make estimates and judgements that affect 
the reported amounts of assets and liabilities the disclosure of contingent assets and liabilities and the reported amount of revenue and
expenses during the year the group evaluates its estimates and judgements on an ongoing basis such estimates and judgements are based
upon historical experience and other factors it believes to be reasonable under the circumstances actual results may differ from estimates
management has discussed with the audit committee the development selection and disclosure of the group’s critical accounting policies and
estimates and the applications of these policies and estimates key estimates and judgements have been made in respect of the following areas
a estimates
intangible assets – goodwill carrying value
a full impairment review has been performed of all goodwill and intangibles balances held across the group on a cash generating unit basis the
impairment review is performed on a ‘value in use’ basis which requires estimation of future net operating cash flows the time period over which
they will occur an appropriate discount rate and an appropriate growth rate further details including sensitivity analysis are given in note 10
and the accounting policy is set out in note 1p
defined benefit pension plans
a qualified independent actuary undertakes the estimation of the present value of the group’s obligations under defined benefit pension
schemes using assumptions taken from a range of possible actuarial assumptions these assumptions may not be borne out in practice especially
due to the long timescales involved in particular the valuation of scheme assets is based on the fair value at the balance sheet date as these
assets are not intended to be sold in the short term their value may change significantly prior to realisation in reviewing the work of the qualified
independent actuary management were required to exercise judgement to satisfy themselves that appropriate weight had been afforded to
macroeconomic factors details of the actual assumptions used including sensitivity analysis are set out in note 5c
derivative financial instruments
judgement is required in the assessment of prospective effectiveness and specifically in the assessment of the probability of forecast transactions
both at hedge inception and during the period over which hedge accounting is adopted the fair value of derivative financial instruments can also
involve judgement where appropriate external valuations from financial institutions are undertaken to support the carrying value of such items
details of sensitivity analysis are set out in note 25l
118 tui travel plc annual report  accounts 2009
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financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
b judgements
separately disclosed items
separately disclosed items are those significant items which in management’s judgement are highlighted by virtue of their size or incidence to
enable a full understanding of the group’s financial performance such items are included within the income statement caption to which they
relate notes 3 and 4
other asset carrying values
management perform an assessment at each balance sheet date of all material assets across the group for signs of impairment key judgement
areas include the carrying values of land and buildings aircraft ships yachts and motorboats trade receivables and prepaid accommodation the
recovery of these assets is dependent on estimated future cash flows receivable and the provision of future services or goods by third parties
useful economic lives and residual values are subject to regular management review
business combinations
judgement and estimation is required in the identification and valuation of separable assets and liabilities on acquisitions in particular
judgement and estimation is required in the identification and valuation of separable intangible assets being brands orders books and customer
databases and determining appropriate useful economic lives for these assets judgement and estimation is also required in determining
contingent consideration payable in respect of acquisitions details of acquisitions are set out in note 13
liabilities
in accounting for provisions judgement is required in determining occurrence probability maturity and level of risk judgement and estimation is
required in determining aircraft maintenance restructuring and onerous lease provisions due to the volume of transactions and the materiality of
period end accruals judgement is also required in respect of the recognition and derecognition of airline and accommodation operating accruals
details of provisions made and the basis on which the provision has been calculated is disclosed in note 21 and the accounting policy is set out 
in note 1t
sharebased payments
judgement and estimation is required in determining the fair value of shares at the date of award the fair value is estimated using valuation
techniques which take into account the awards’ term the riskfree interest rate and the expected volatility of the market price of the company’s
shares details of sharebased payments and the assumptions applied are disclosed in note 5d and the accounting policy is set out in note
1yix
noncurrent assets and disposal groups held for sale
the classification of noncurrent assets and disposal groups as ‘held for sale’ requires judgement in determining whether the planned disposal is
highly probable and able to be realised within 12 months the measurement of held for sale assets at their fair value less costs to sell can also
require significant judgement if there is no active market
lease accounting
judgement is required in the initial classification of leases as either operating leases or finance leases and in respect of finance leases
determining the appropriate discount rate implicit in the lease to discount minimum lease payments in respect of certain leases classified as
finance leases it has not been possible to reliably estimate lessors’ residual values and management has been required to independently estimate
an appropriate discount rate judgement is also required in respect of the treatment of gains and losses arising on the sale and leaseback of
assets note 11 the accounting policy for leases is set out in notes 1g 1h and 1q
taxation
the group has from time to time contingent tax liabilities arising from trading and corporate transactions in the uk and overseas jurisdictions
after taking appropriate external advice the group makes provision for these liabilities based on the probable level of economic loss that may be
incurred and which is reliably measurable judgement is also required in the assessment of the future recoverability of tax losses and recognition
of deferred tax assets details of unrecognised tax losses are given in note 14
recoverable amounts of deposits and prepayments
judgements have been made in respect of the volumes of future trading with hoteliers and the creditworthiness of those hoteliers in order to
assess the recoverable amounts of deposits and prepayments made to those hoteliers
tui travel plc annual report  accounts 2009 119
wwwtuitravelplccom 32 principal operating subsidiaries
other than as stated below all the principal operating subsidiaries listed are wholly owned principal operating subsidiaries are those which in 
the opinion of the directors significantly affected the group’s results and net assets during the year the directors consider that those companies
not listed are not significant in relation to the group as a whole all of the subsidiaries have only ordinary share capital except for first choice
canada inc which also has unlimited preference shares all of which are owned by the group tui uk limited is presented within the mainstream
sector northern region to reflect its principal operations but the company also includes certain uk activity and specialist businesses at 
30 september 2009
subsidiary country nature of business
mainstream sector
mainstream – northern region
falcon leisure group overseas limited eire t our operator
first choice holidays finance limited united kingdom treasury operation
first choice canada inc canada t our operator
sunshine cruises limited trading as island cruises ltd united kingdom cruise vessel operator
thomson airways limited united kingdom airline
tui nordic holding ab sweden t our operator
tui uk limited united kingdom t our operator
tui uk retail limited united kingdom travel agent
tuifly nordic ab sweden airline
mainstream – central europe
berge und meer t ouristik gmbh germany t our operator
hapaglloyd express gmbh germany airline
hapaglloyd fluggesellschaft mbh germany airline
l’tur t ourismus ag 70 germany t our operator
tui suisse ag switzerland t our operator
tui austria holding gmbh austria t our operator
tui aviation gmbh germany leasing company
tui deutschland gmbh germany t our operator
tui leisure travel gmbh germany travel agent
tui österreich gmbh austria t our operator
mainstream – western europe
groupe marmara sas france t our operator
groupe nouvelles frontières sas france t our operator
jetair nv belgium t our operator
société d’investissement aérien sa jet4you morocco airline
tui airlines belgium nv belgium airline
tui airlines nederland bv netherlands airline
tui travel belgium nv belgium t our operator
tui nederland nv netherlands t our operator
jet4you is held for sale at 30 september 2009
specialist  emerging markets sector
aventuria sa france t our operator
caradonna dive adventures inc usa t our operator
citalia holidays limited united kingdom t our operator
country walkers inc usa t our operator
educational t ours inc usa t our operator
eefc inc usa t our operator
hayes  jarvis travel limited united kingdom t our operator
i viaggi del turchese srl italy t our operator
international expeditions inc usa t our operator
les t ours jumpstreet t ours inc canada t our operator
meon travel limited united kingdom t our operator
national events inc usa t our operator
royal vacaciones sl spain t our operator
starquest expeditions inc usa t our operator
studentcitycom inc usa t our operator
tcs expeditions inc usa t our operator
t ourinter sa france t our operator
travcoa corporation usa t our operator
travel adventures inc usa t our operator
travelmood limited united kingdom long haul travel
your man t ours inc usa t our operator
120 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
subsidiary country nature of business
activity sector
adventure t ours australia group pty limited australia t our operator
australian sports t ours pty ltd australia t our operator
chs t our services limited united kingdom t our operator
crown blue line limited united kingdom t our operator
eac language centres uk limited united kingdom language teaching
edwin doran limited united kingdom t our operator
exodus travels limited united kingdom t our operator
gullivers sports travel limited united kingdom t our operator
mariner international travel inc usa t our operator
myplanet international as denmark t our operator
peregrine adventures pty ltd australia t our operator
quark expeditions inc usa t our operator
real travel limited united kingdom t our operator
ski bound limited united kingdom t our operator
sportsworld group limited united kingdom t our operator
student skiing limited formerly on the pistecom limited united kingdom t our operator
sunsail limited united kingdom t our operator
sunsail worldwide sailing limited united kingdom t our operator
the moorings limited british virgin islands t our operator
williment world travel limited new zealand t our operator
world challenge holdings limited united kingdom t our operator
yachts international limited british virgin islands t our operator
zegrahm expeditions inc usa t our operator
accommodation  destinations sector
hotelbeds slu spain online accommodation
hotelbeds spain slu spain destination services
hotelbeds product slu spain online accommodation
hotelbeds usa inc usa destination services
late rooms limited united kingdom late accommodation
t antur turizem seyahat as turkey destination services
tui españa turismo sa spain destination services
tui hellas travel t ourism and airlines ae greece destination services
tui travel plc annual report  accounts 2009 121
wwwtuitravelplccom 33 lossearnings per share
the basic lossearnings per share is calculated by dividing the result attributable to ordinary shareholders by the applicable weighted average
number of shares in issue during the year excluding those held in the employee share ownership trusts the diluted earnings per share is
calculated on the result attributable to ordinary shareholders divided by the adjusted weighted average number of ordinary shares which takes
account of the outstanding share awards where their conversion is dilutive the additional earnings per share measures have been given to
provide the reader of the accounts with a better understanding of the results
basic and diluted loss per share from continuing operations is as follows
2009 2008
loss weighted average lossearnings loss weighted average lossearnings
earnings number of shares per share earnings number of shares per share
£m millions pence £m millions pence
basic and diluted loss per share 11 1107 10 271 1109 244
amortisation of business combination
intangibles and impairment of goodwill net of tax 47 – 43 174 – 157
separately disclosed items net of tax 227 – 205 323 – 291
basic underlying earnings per share 263 1107 238 226 1109 204
effect of dilutive options – 11 03 – 9 02
diluted underlying earnings per share 263 1118 235 226 1118 202
basic and diluted loss per share from the discontinued operation is as follows
2009 2008
weighted average loss weighted average earnings
loss number of shares per share earnings number of shares per share
£m millions pence £m millions pence
basic and diluted loss per share 14 1107 13 – 1109 –
for statutory measures of loss per share in both the current and prior year the effect of options is antidilutive the antidilutive effect is not
taken into account and basic loss per share and diluted loss per share are both disclosed as 10p 2008 244p for continuing operations and
13p 2008 nil p for the discontinued operation the diluting effect of options in 2009 and 2008 is included solely to calculate diluted
underlying earnings per share
34 post balance sheet events
the following events after 30 september 2009 are disclosed in the notes to the consolidated financial statements
• acquisitions details of acquisitions since the balance sheet date are set out in note 13
• trade investments details of the investment in air berlin are set out in note 12
• convertible bond issue details are provided in note 1bv and note 25f – funding and liquidity and
• capital commitments on 3 october 2009 an agreement was reached with boeing to cancel 10 of the b787 aircraft the group had on order
details are provided in note 28
35 ultimate parent company
the ultimate parent company is considered to be tui ag a company registered in berlin and hanover federal republic of germany 
at 30 september 2009 tui ag was the beneficial owner of 5254 of the ordinary share capital of the company on a fully diluted basis
tui ag prepares consolidated financial statements which include the results of the group the accounting reference date of tui ag is 
30 september previously 31 december copies of the tui ag financial statements are publicly available and can be obtained from the
registered office of this company situated at karlwiechertallee 4 30625 hanover federal republic of germany
122 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
financial statements
notes to the consolidated financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
30 september 30 september
2009 2008
note £m £m
fixed assets
investment in subsidiary undertakings d 911 706
total investments 911 706
current assets
derivative financial instruments 30 3
debtors e 234 547
cash at bank and in hand 36 205
300 755
creditors amounts falling due within one year f 311 70
net current liabilitiesassets 11 685
total assets less current liabilities 900 1391
creditors amounts falling due after more than one year g 631 998
net assets 269 393
capital and reserves
share capital h 112 112
profit and loss account i 127 267
other reserve i 30 14
equity shareholders’ funds i 269 393
the financial statements were approved by a duly authorised committee of the board of directors on 30 november 2009 and were signed on its
behalf by
paul bowtell
chief financial officer
tui travel plc annual report  accounts 2009 123
wwwtuitravelplccom
company balance sheet
at 30 september 2009 a accounting policies
basis of preparation
the following accounting policies have been applied consistently in
dealing with items which are considered material in relation to the
company’s financial statements
accounting convention
the financial statements have been prepared in accordance with
applicable uk accounting standards and under the historical cost
convention the financial statements have been prepared on the going
concern basis which assumes that the company will continue in
operational existence for the foreseeable future
the company has taken advantage of the exemption under section
408 of the companies act 2006 from presenting its own profit and
loss account the loss after tax included in the financial statements 
of the company determined in accordance with the act was £33m
14month period ended 30 september 2008 profit of £376m
under financial reporting standard no 1 revised the company is
exempt from the requirement to prepare a cash flow statement as its
cash flows are included within the published consolidated statement
of cash flows of tui travel plc
the company has taken advantage of the exemption contained within
frs 8 and has not therefore disclosed transactions or balances with
entities which form part of its group
the company has taken advantage of the exemption contained within
frs 29 and has not provided the required financial instruments
disclosure on the basis that the group’s consolidated financial
statements include consolidated ifrs 7 disclosures which are
compliant with the requirements of frs 29
foreign currencies
transactions in foreign currencies are translated at the foreign
exchange rate ruling at the date of the transaction monetary assets
and liabilities denominated in foreign currencies at the balance sheet
date are translated to sterling at the foreign exchange rate ruling at
that date foreign exchange differences arising on translation are
recognised in the income statement nonmonetary assets and
liabilities that are measured in terms of historical cost in a foreign
currency are translated using the exchange rate at the date of the
transaction nonmonetary assets and liabilities denominated in
foreign currencies that are stated at fair value are translated to 
sterling at foreign exchange rates ruling at the dates the fair values
were determined
leases
assets acquired under finance leases are capitalised and the outstanding
future lease obligations are shown in payables operating lease rentals
are charged to the profit and loss account on a straightline basis over
the period of the lease
operating lease income is recognised in the profit and loss account on
a straightline basis over the period of the lease
investments
in the company’s financial statements investments in subsidiaries are
stated at cost less provision for impairment dividends received and
receivable are credited to the company’s profit and loss account
interestbearing borrowings
interestbearing borrowings are recognised initially at fair value less
attributable transaction costs subsequent to initial recognition
interestbearing borrowings are stated at amortised cost with any
differences between cost and redemption value being recognised 
in the income statement over the period of the borrowings on an
effective interest rate basis
classification of financial instruments issued
financial instruments issued by the company are treated as equity
only to the extent that they meet the following conditions they
include no contractual obligation upon the company to deliver cash 
or other financial assets or to exchange financial assets or financial
liabilities with another party under conditions that are potentially
unfavourable to the company and where the instrument will or may
be settled in the company’s own equity instruments it is either a 
nonderivative that includes no obligation to deliver a variable number
of the company’s own equity instruments or is a derivative that will be
settled by the company exchanging a fixed amount of cash or other
financial assets for a fixed number of its own equity instruments
derivative financial instruments
derivative financial instruments are stated at fair value the gain or
loss on remeasurement to fair value is recognised immediately in 
the income statement however where derivatives qualify for hedge
accounting recognition of any resultant gain or loss depends on the
nature of the item being hedged
sharebased payment
the company operates sharebased payment schemes for the
employees of its subsidiaries the fair value of shares awarded to
employees of the company is recognised as an employee expense with
a corresponding increase in equity the employee expense is recharged
to fellow group subsidiaries the company grants awards of its own
shares to the employees of its subsidiaries and as such recognises 
an increase in the cost of investment in its subsidiaries equivalent to
the equitysettled sharebased payment charge recognised in its
subsidiaries’ financial statements with the corresponding credit being
recognised directly in equity the fair value is measured at the award
date and is spread over the period during which the employee
becomes unconditionally entitled to the awards calculating the 
fair value takes into account various factors including the expected
volatility of the shares the dividend yield and the risk free interest
rate further information on the share schemes is provided in note 5
to the consolidated financial statements
the increase in investments and credit to equity for the year ended 
30 september is £16m 14month period ended 30 september 
2008 £14m
transactions of the company’s employee benefit trust are included in
the company’s financial statements in particular the trust’s purchases
and sales of shares in the company are debited and credited directly
to equity
financial statements
notes to the company’s financial statements
124 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
taxation
the charge for taxation is based on the profit or loss for the period and takes into account taxation deferred because of timing differences
between the treatment of certain items for taxation and accounting purposes
except as otherwise required by accounting standards full provision without discounting is made for all timing differences which have arisen but
not reversed at the balance sheet date timing differences arise when items of income and expenditure are included in tax computations in
periods different from their inclusion in the financial statements
dividend on shares presented within shareholders’ funds
dividend distribution to the company’s shareholders is recognised as a liability and deducted from equity in the group’s financial statements in
the period in which the dividends are appropriately authorised and approved for payment and are no longer at the discretion of the company
unpaid dividends that do not meet these criteria are disclosed in the notes to the financial statements
auditors’ remuneration
the company’s 2009 audit fee was £25000 2008 £25000
b directors’ remuneration and employees
details of directors’ remuneration gains made by them on vesting of share awards amounts receivable by them under long term incentive
schemes and pension entitlements in the current year and prior period are contained in the audited section of the remuneration report and 
in note 5 of the consolidated financial statements the company had nine employees 2008 nine details of all share awards issued by the
company are given in note 5 of the consolidated financial statements
c dividends
details of dividends paid and proposed by the company in the current year and prior period and details of dividends proposed subsequent 
to the balance sheet date are given in note 9 of the consolidated financial statements
d investments
shares in
subsidiaries
£m
cost
at 1 october 2008 706
acquisitions 9
additions 16
recapitalisation of group companies 184
disposals 4
at 30 september 2009 911
provision for diminution in value
at 30 september 2008 and at 30 september 2009 –
net book value
at 30 september 2009 911
at 30 september 2008 706
additions represent sharebased payment liabilities incurred the costs of the sharebased schemes which are operated for employees of the
company’s subsidiaries are borne by the subsidiaries subject to local accounting standards the company recognises an increase in the
investment in the subsidiary and a credit to retained earnings in accordance with frs 20 sharebased payment
details of the principal operating subsidiaries held directly and indirectly by the company and of companies acquired in the year ended 
30 september 2009 can be found in notes 13 and 32 of the group’s consolidated financial statements
recapitalisation of group companies relates to £184m invested in t ouraventura sa during the restructure of certain of the french companies 
to combine two existing tax groups during the year
e debtors
30 september 30 september
2009 2008
£m £m
amounts owed by group undertakings 234 546
other receivables – 1
total 234 547
tui travel plc annual report  accounts 2009 125
wwwtuitravelplccom f creditors amounts falling due within one year
30 september 30 september
2009 2008
£m £m
loan notes – 2
amounts owed to group undertakings 55 61
amounts owed to ultimate parent company 252 –
deferred and contingent consideration 4 4
accruals and deferred income – 3
total 311 70
g creditors amounts falling due after more than one year
30 september 30 september
2009 2008
£m £m
loan notes – 1
bank loans and overdrafts – 132
amounts owed to group undertakings – 3
amounts owed to ultimate parent 611 840
deferred and contingent consideration 20 22
total 631 998
amounts owed to the ultimate parent at 30 september 2009 comprise a shareholder loan from the ultimate parent tui ag which is being repaid
in instalments over the period to april 2011 and bears interest at euribor plus a margin currently 15 per annum increasing sixmonthly by
02 to a maximum of 20 per annum the company can make voluntary repayments at any time during the term of the loan subject to a
minimum repayment of €10m and the giving of 30 days’ notice the drawn balance of the loan at 30 september 2009 was €919m of which
€669m is due in more than one year 2008 €1019m all due in more than one year not including accrued interest payable
all balances repayable after more than one year are due within one to two years
h share capital
30 september 30 september
2009 2008
£m £m
authorised share capital
1999500020 2008 1999500020 ordinary shares of 10p each 200 200
49998 2008 49998 redeemable preference shares of £1 each – –
total 200 200
allotted called up and fully paid share capital
1118010670 2008 1118010670 ordinary shares of 10p each 112 112
total 112 112
i capital and reserves
share profit
capital and loss other t otal
account account reserve
£m £m £m £m
at 1 august 2007 ––––
profit for the period – 376 – 376
issue of shares 112 – – 112
share issue costs – 24 – 24
sharebased payment costs – – 14 14
shares acquired to satisfy sharebased payment schemes – 20 – 20
dividends paid – 65 – 65
at 30 september 2008 112 267 14 393
loss for the year – 33 – 33
sharebased payment costs – – 16 16
dividends paid – 107 – 107
at 30 september 2009 112 127 30 269
at 30 september 2009 shareholders’ funds are all due to equity shareholders
126 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
financial statements
notes to the company’s financial statements continued group at a glance strategic overview business performance governance financial statements shareholder information
j operating lease commitments
the company’s obligations under operating lease contracts are as follows
aircraft aircraft
30 september 30 september
2009 2008
£m £m
annual commitments under noncancellable operating leases expiring
after five years – 7
total – 7
all operating lease commitments relate to aircraft aircraft leased by the company are subleased to subsidiary undertakings on similar terms 
on 9 june 2009 all aircraft leases were novated to a fellow group company tui aviation finance limited which was incorporated for this purpose
k contingent liabilities
under the terms of guarantees given to the civil aviation authority and other relevant authorities by the company in respect of certain
subsidiaries in the event of default the company could be held liable to the extent of the subsidiaries’ net trading liabilities at the time of default
the company and its subsidiaries is at any time defending a number of actions against it arising in the normal course of business provision 
is made for these actions where this is deemed appropriate no actions which are outstanding at 30 september 2009 are expected to have a
material effect on these accounts the directors consider that adequate provision has been made for all known liabilities
where the company enters into financial guarantee contracts to guarantee the indebtedness of other companies within its group the company
considers these to be insurance arrangements and accounts for them as such in this respect the company treats the guarantee contract as a
contingent liability until such time as it becomes probable that the company will be required to make a payment under the guarantee
l post balance sheet events
details of post balance sheet events relevant to the company and its group are given in note 34 of the consolidated financial statements
tui travel plc annual report  accounts 2009 127
wwwtuitravelplccom year ended year ended year ended
30 september 30 september 30 september
2009 2008 2007
£m £m £m
revenue 13863 13932 12840
underlying operating profit 443 398 261
underlying operating profit margin  32 29 20
underlying earnings per share basic 238p 204p 144p
return on invested capital roic 92 84 54
shareholder profiles
in the 12 months to 30 november 2009 the company was notified by way of transparency directive form 1
tr1 notifications of the following voting rights of the issued ordinary share capital of the company
shares
m 
tui ag 603996039 5400
prudential 37097287 331
financial calendar
agm 9 february 2010
interim results may 2010
preliminary results december 2010
128 tui travel plc annual report  accounts 2009
wwwtuitravelplccom
shareholder information
threeyear financial history group at a glance strategic overview business performance governance financial statements shareholder information
eligible shareholders are entitled to the following discounts which are
subject to change when booking holidays through our dedicated
shareholder discount line
first choice
best price on the wwwfirstchoicecouk website plus a further discount of
£20 per adult or £40 per booking cruise shortmedium haul destinations
or £40 per adult or £80 per booking long haul destinations
thomson
best price on the wwwthomsoncouk website plus a further discount of
£20 per adult or £40 per booking cruise shortmedium haul destinations
or £40 per adult or £80 per booking long haul destinations
thomson airways
best price on the wwwthomsoncouk website plus a further discount of
£10 per person for a return journey shortmedium haul destinations
or £20 per person for a return journey long haul destinations
thomson worldwide
best price on the wwwthomsonworldwidecom website plus a 
further discount of £20 per adult or £40 per booking shortmedium
haul destinations or £40 per person or £80 per booking long 
haul destinations
citalia
best price on the wwwcitaliacom website plus a further discount of
£20 per adult or £40 per booking shortmedium haul destinations 
or £40 per person or £80 per booking long haul destinations
hayes  jarvis
best price on the wwwhayesandjarviscouk website plus a further
discount of £20 per adult or £40 per booking shortmedium 
haul destinations or £40 per person or £80 per booking long 
haul destinations
jetsave
best price on the wwwjetsavecouk website plus a further discount 
of £20 per adult or £40 per booking shortmedium haul destinations
or £40 per person or £80 per booking long haul destinations
meon villas
best price on the wwwmeonvillascom website plus a further discount
of £20 per adult or £40 per booking shortmedium haul destinations
or £40 per person or £80 per booking long haul destinations
sovereign
best price on the wwwsovereigncom website plus a further discount
of £20 per adult or £40 per booking shortmedium haul destinations
or £40 per person or £80 per booking long haul destinations
hotelopia
best price on all hotels on the wwwhotelopiacouk website plus an
additional 14 discount
imaginative traveller
best price on the wwwimaginativetravellercom website plus an
additional 10 discount
country walkers
best price on the wwwcountrywalkerscom website plus a further
discount of £200 per adult or £400 per booking on all escorted tours
the moorings
best price on the wwwmooringscom website plus a further discount
of £20 per adult or £40 per booking short haul destinations or £40
per adult or £80 per booking long haul destinations
sunsail
best price on the wwwsunsailcouk website plus a further discount of
£20 per adult or £40 per booking short haul destinations or £40 per
adult or £80 per booking long haul destinations
le boat
best price on the wwwleboatcouk website plus a further discount 
of £20 per adult or £40 per booking on all destinations
club vass
best price on the wwwclubvasscom website plus a further discount 
of £20 per adult or £40 per booking on all destinations
discounts are not valid on accommodationonly bookings and cannot be used in conjunction
with any discretionary discounts group savings or other promotional offers
in order to qualify for the scheme private shareholders including
those holding through a nominee account must hold at least 500
ordinary shares in the company on the date of booking the holiday
and must have been on the register of shareholders for a minimum
period of one year on that date
t o register for your discount call equiniti on 0871 384 2030 monday
to friday 08301730hrs you will be required to provide details to
confirm you are an eligible shareholder once confirmed you will be
given a unique code
t o make a booking call us on 0844 800 3104 monday to friday 0900
1800hrs saturday 09001700hrs you will be asked for your unique
code and your discount will be applied
share dealing service
an executiononly sharedealing service for the purchase and sale of
tui travel plc shares is available from natwest stockbrokers natwest
stockbrokers is authorised and regulated by the financial services
authority and is a member of the london stock exchange and plus
for details please contact
natwest stockbrokers
waterhouse square
38142 holborn
london ec1n 2th
t el 0808 208 4433
find out more
tui travel plc has a corporate website which can be accessed through
wwwtuitravelplccom
shareholder discount
tui travel plc annual report  accounts 2009 129
wwwtuitravelplccom secretary and registered office
a l john
tui t ravel plc
tui t ravel house
crawley business quarter
fleming way
crawley
west sussex rh10 9ql
t elephone 44 01293 645700
facsimile 44 01293 645704
registered number 6072876
auditors
kpmg audit plc
merchant bankers
lazard brothers  co limited
deutsche bank
stockbrokers
rbs hoare govett limited
deutsche bank
solicitors
herbert smith
bankers
barclays bank plc
citigroup na
royal bank of scotland plc
société générale
registrars and transfer office
equiniti limited
aspect house
spencer road
lancing bn99 6da
shareholder contact centre no 0871 384 2030
international 44 0 121 415 7161
website wwwshareviewcouk
company website
wwwtuitravelplccom
shareholder information
contacts and advisers
130 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
agm
annual general meeting
ad
accommodation  destinations sector
assetright
optimum mix of owned and leased assets
b2b
businesstobusiness
b2c
businesstoconsumer
bedstock
accommodation capacity
bednights
amount of accommodation sold
bn
billion
business combination
the merger of the t ourism division of tui ag excluding certain 
hotel assets and first choice holidays plc
cis
commonwealth of independent states
co
2
rpk
carbon dioxide emissions per revenue passenger kilometre
controlled distribution
owned and franchised retail shops call centre and website
cgu
cash generating unit
dabs
deferred annual bonus scheme
differentiated content
includes hotels and products that have been tailored to offer
additional services and facilities to our customers
direct distribution
retail call centre and website
ebt
employee benefit trust
eps
earnings per share
ets
european emissions trading scheme
gas
group audit services
gdp
gross domestic product
gmb
group management board
jv
joint venture
kpis
key performance indicators
lates market
810 weeks prior to departure
load factor
passenger volumes as a percentage of capacity
m
million
merger
the business combination of the t ourism division of tui ag
excluding certain hotel assets and first choice holidays plc
mou
memorandum of understanding
psp
performance share plan
rcf
revolving credit facility
roic
return on invested capital
rpi
retail price index
sector
subset of tui travel plc whose businesses share similar
characteristics these include mainstream sector activity sector
specialist  emerging markets sector and accommodation 
destinations sector
specialist sectors
the specialist sectors are the activity sector specialist  emerging
markets sector and accommodation  destinations sector
summer season
may to october
tsr
t otal shareholder return
tui ag
tui travel plc’s majority shareholder
the board
tui travel plc board of directors
the group
the tui travel plc group of companies
the company
tui t ravel plc
vcsp
value creation synergy plan
wacc
weighted average cost of capital
winter season
november to april
glossary of key terms
tui travel plc annual report  accounts 2009 131
wwwtuitravelplccom a
accommodation  destinations sector 5 41
accounting policies 68
acquisitions 31 98
activity sector 5 39
annual general meeting 46
audit committee 51
auditors 63
b
balance sheet 123
board committees 50
board of directors 44
brands 3
business performance 30
c
chairman’s statement 10
chief executive’s statement 11
chief executive’s interview 12
climate change 10 28
colleagues 22
company balance sheet 123
consolidated balance sheet 65
consolidated income statement 64
consolidated statement of cash flows 66
consolidated statement of recognised 
income and expense 67
consumer sentiment 9
contacts and advisers 130
corporate governance report 49
current trading 42
d
directors’ biographies 45
directors’ report 46
directors’ responsibilities 48
directors’ remuneration 57
distribution  brands 15
dividends 10 32 90
e
earnings per share 32
emerging markets 9 17
f
financial calendar 128
financial highlights 6
financial statements 64
fuel and foreign exchange 43
g
glossary of key terms 131
governance 44
group at a glance ifc
group management board 22
group performance 30
growth  capital allocation 17
i
independent auditors’ report 63
investment case ifc
k
key performance indicators 18
m
mainstream sector 4 34
market overview 8
n
notes to the company’s financial statements 124
notes to the consolidated financial statements 68
net debt 116
nomination committee 51
o
operational highlights 7
outlook 43
p
people  operational effectiveness 16
pensions 33
principal risks 20
principal operating subsidiaries 120
product  content 14
r
remuneration committee 53
remuneration report 53
report of the directors 46
responsible leadership 22
risk 20
s
segmental performance 34
shareholder profiles 128
shareholder discount 129
shareholder information 128
specialist  emerging markets sector 5 40
strategy 14
strategic imperatives 14
strategic overview 8
structure 4
sustainable development 26
suppliers 29
t
t axation 32 89
threeyear financial history 128
tui t ravel overview 2
t otal shareholder return 56
w
who we are 2
where we operate 3
shareholder information
index
132 tui travel plc annual report  accounts 2009
wwwtuitravelplccom designed and produced by likemind wwwlikemindcom
this report is printed on regency satin which contains material
sourced from responsibly managed forests certified in accordance
with the fsc forest stewardship council it is made from 10
recovered fibre diverting waste from landfill and is manufactured
under strict environmental management systems the international
iso 14001 standard emas ecomanagement  audit scheme and
the ippc integrated pollution prevention and control regulation
printed in england by cousin cousin is a carbon neutral company 
with iso 4001 accreditation it recycles all solvents used in the printing
process making any waste ph neutral and also holds fsc status
photography supplied by exodus first choice tui deutschland 
tui españa tuifly tui picture pool tui nederland tui nordics quark
wwwtuitravelplccom tui travel plc
tui travel house
crawley business quarter
fleming way
crawley
west sussex
rh10 9ql
t elephone 01293 645700
wwwtuitravelplccom
tui travel plc annual report  accounts for the year ended 30 september 2009


Summary:
 in what has been a very economically challenging
year in the global market place where we have
experienced the deepest and longest postwar
recession rising unemployment loss of consumer
confidence and increased cost pressures i am
delighted that tui t ravel has achieved strong results
for me if there is one thing that really stands out 
it is the dedication and commitment of all our
colleagues at tui t ravel
i believe that we have the best management team
in the industry and this is borne out by the way
businesses perform in times of adversity it is one
thing to perform well when the trading environment
is positive or benign but it is quite another thing to
produce good performance when times are tough
we also have a good mix of tour operator and
functional experts across the group which creates
the right balance to successfully manage what is 
a huge complex international business
it is not only about the team at the top though 
we have identified our talent pool and considerable
time and commitment is going into developing our
leaders of tomorrow i have had the opportunity 
of spending time with them this year and what 
a fantastic group of colleagues they are it is both a
privilege and reassuring to know that as the business
grows we will have the right team to grow with it
it’s been very interesting to see the reactions of 
our customers within our different source markets
during this period of economic uncertainty
the first market where we saw a marked reaction
was in the united states the subprime mortgage
issue was a significant factor and unemployment
rose much more quickly than in our other source
markets and consumer confidence was lower much
earlier we experienced a marked drop in bookings
across a number of our businesses having taken
the pain earlier however the us market is now
coming back strongly and the businesses are
performing accordingly
in the uk we have experienced a later booking
pattern – if someone is concerned about whether
they will have a job or not it’s not surprising that
they delay booking their annual summer holiday
they did however eventually book and because
we had ensured that we aligned capacity with
demand although they were booking later we
weren’t having to discount the price
how are the different markets responding to
the current economic climate
what are the highlights of this year for you
there is evidence that consumer confidence in the uk
is improving as we’re seeing strong demand for late
bookings this winter furthermore i am encouraged
by our booking pattern for summer 2010
in germany and to a lesser or greater extent our
other european source markets we think it could
be slightly different the fiscal measures put in
place in these countries means that they have not
experienced the unemployment levels that we have
seen in either the us or the uk once these
measures cease we may see unemployment rise
we are therefore planning cautiously for next year
in these source markets although there are positive
signs in a number of these countries
we have experienced both lower demand and
significant cost inflation across the group which 
we managed through our flexible business model
carefully aligning capacity with demand allowed 
us to achieve our required load factors and also
ensured that there was no excessive discounting 
in the lates market despite the later booking trend
we have identified a number of businesses across
the group that were or are underperforming and
we have taken or are taking appropriate steps to
address these
in germany we have concluded a transaction with
air berlin who will take over our city pairs business
this allows us to exit an operation which made
significant losses in 2008 this deal makes strategic
sense for both us and air berlin we are also
improving our product mix in germany which will
deliver higher margins and have plans in place to
increase our controlled distribution
in france within nouvelles frontières we are
rationalising the product range to ensure that we
operate programmes of significant scale to key
destinations corsair our long haul scheduled
airline was hit by a series of sociopolitical events 
in a number of its key destinations and we are
continuing to review its business model and
strategy our retail operation in both nouvelles
frontières where we were subscale and marmara
where we relied heavily on third party agents
needed to be addressed we are now selling
marmara product through our nouvelles frontières
and havas retail operations and the transaction
with carlson wagonlit travel after the year end
gives us the scale we require
in canada which is an extremely competitive
market with significant overcapacity we have a
weak market position and made a loss of £24m in
2009 having reviewed the strategic alternatives for
what steps have you taken to further 
improve the group’s business performance
strategic overview  chief executive’s interview
an interview with 
chief executive peter long
12 tui travel plc annual report  accounts 2009
wwwtuitravelplccom group at a glance strategic overview business performance governance financial statements shareholder information
canada we recently announced a strategic venture
with sunwing a leading tour operator in canada 
the transaction once completed will strengthen
our position in the canadian market and bring 
a number of strategic and financial benefits to 
the group
for us it’s all about delivering sustainable longer
term growth and our flexible and efficient business
model remains key to what we do
we will be focusing on continuing to improve those
areas of the business that are underperforming
increasing our differentiated and exclusive product
and getting the right mix of controlled distribution
across the whole of our mainstream sector
we will also look closely at how we shape our long
haul programme being the european launch customer
for the boeing 787 we will ensure that we take full
advantage of the competitive advantage this brings us
within our specialist sectors we have a unique
portfolio that is impossible to replicate and our
focus will be on driving organic growth in our
existing businesses and maximising further the
merger integration opportunities we have we will
expand into new source markets with specialist
products just as we did with le boat in germany
we continue to identify new market niches that
offer highgrowth potential and where we can easily
establish a significant position in russia and ukraine
we will leverage and grow our existing platforms as
well as investigating further the potential of other
emerging markets
travel and tourism is the world’s largest industry
and has grown and changed rapidly over the last 
30 years in 1979 there were 270 million international
tourist arrivals this has risen to nearly a billion
today and the prediction for 2020 is 16 billion
the mainstream tour operators opened customers’
eyes to safe travel beyond one’s own country and
people are more adventurous today it started with
spain but now customers are more confident and
will happily go to destinations like egypt turkey the
dominican republic and mexico it’s not only about
a sun and beach holiday many of our group’s
customers want to go on experiential holidays like
sailing trekking in the himalayas safaris or polar
expedition cruising and these will continue to
become even more popular
how do you see the leisure travel market
developing in the future
how will your strategy and business model
develop over the next couple of years
the new generation of aircraft like the boeing 787
will allow our customers to fly even further afield to
new destinations in aircraft that are more fuel
efficient offer greater comfort and are less
damaging to the environment than today’s aircraft
we are in a constantly changing industry and if we
stand still we will be left behind we put our customers
at the heart of everything we do and not only deliver
what they want today but continue to innovate in
order to deliver what they will want tomorrow
every year we face different challenges and we deal
with them be they geopolitical natural disasters or
economic but for me there are two key challenges
that we are addressing one is carbon reduction and
the second is regulation
we operate in a high carbon industry although 
we are a tour operator first and foremost we also
have a fleet of 150 aircraft to take our customers
on holiday and unfortunately today there is no
alternative to jet fuel mass production of second
generation biofuels which seem more viable 
are still a considerable number of years off we
therefore have to do all we can to reduce our
carbon dioxide emissions ourselves and are making
a significant investment in new technology like the
boeing 787 we have committed to reducing our
carbon emissions from our fleet by 6 by 2014
we are supportive of the inclusion of aviation in 
the european emissions trading scheme ets but
believe there should be a global emissions trading
framework for aviation which channels monies
raised from auctioning emissions allocations into
environmental solutions rather than national coffers
we also don’t want to see the aviation industry
being hit twice both by national governments in 
tax raising schemes and also by ets
as a tour operator we are heavily regulated and we
do not have an issue with that what we do have an
issue with however is that competitors in the same
market competing for the same customers and the
same business should be regulated in the same way
and this isn’t the case we welcome the fact that
the european commission is looking at revising the
package travel directive which has been in place for
nearly 20 years and does not take into consideration
the way the leisure travel market has changed
particularly in the last six or seven years with the
low cost carriers and online travel agents financial
protection also needs to be addressed especially in
the light of the number of airline failures that we
have seen and may well continue to see
what are the challenges tui travel is facing
tui travel plc annual report  accounts 2009 13
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