Preussag doubles profit

August 23, 2001 Posted: 1351 GMT

LONDON (CNN) -- Preussag, Europe's leading travel operator, more than doubled its net profit in the second quarter, beating analysts' expectations.

The Germany company said on Thursday earnings came in at 163 million (£102 million) for the three months to June 30, up from 70 million a year earlier, following an unexpectedly strong performance in its tourism division.

Preussag's shares leapt 5.7 percent to 36.25 in mid-afternoon trading in Frankfurt, making them the strongest performer on the Xetra Dax index. Earnings per share were 0.93, up from 0.53 in last year's second quarter.

"The economy lost momentum in large parts of the world in the second quarter... [but] tourism recorded sustained growth again," the company said in a statement.

The travel company – formerly a mining company under state ownership -  added: "Logistics also continued its positive development, although the increase in the world trade volume slowed down in the course of the quarter."

Tourism boost profits for travel giant

The tourism division saw its turnover reach 3.6 billion, an increase of 1.3 billion on the previous quarter and up 25 percent year-on-year.

The logistics division, which includes the Hapag Lloyd container ship line, increased its turnover to 922 million in the three months to June, a rise of 3.5 percent.

Preussag's first-half results beat analysts' forecasts for the second time this year, Reuters reported, as operating profit surged 42 percent.

The news agency said that its survey of 11 analysts threw up an average operating profit estimate of 299 million for the first six-months. Preussag reported 347 million.

The tourism business traditionally sees a weaker first half year, ahead of the stronger third quarter which includes the peak holiday season.

The company announced it would rebrand all its individual tourism companies, which include top European names such as Thomson Travel in Britain and Hapag Lloyd in Germany, under the brand World of TUI.

Preussag chief executive Michael Frentzel told a news conference the brand would be implemented when the company's programme of divestments was completed and tourism accounted for 80 percent of its business.

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