Media Information

Following Kuoni Group's latest media informations in chronological order.
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The shares of Kuoni Travel Holding Ltd have been delisted at SIX (Zurich Stock Exchange) as of 10 November 2016 after the Kuoni Group had been taken private by private equity company EQT.

Results of the Tender Offer for Kuoni Travel Holding Ltd’s (“Kuoni”) out-standing bonds due 28 October 2019

15.09.2017

During the extension of the tender offer period, Kuoni has received tenders for the redemption of its outstanding CHF 200,000,000 1.50% bond 2013-2019 (Valor 22.294.867) with an aggregate par value of CHF 2,940,000.

Kuoni launched on 15 June 2017 a tender offer and invited all holders of its outstanding CHF 200,000,000 1.50% bond due 28 October 2019 to tender their bonds against cash payment of 102% of the par value of the tendered bonds plus accrued interest until the settlement date. The tender offer commenced on 15 June 2017 and, following two extensions of the offer period, expired on 14 September 2017 at 12:00 noon (CEST).

The total principal amount of the Kuoni bonds to be repurchased by Kuoni during the extension of the offer period is CHF 2,940,000 and will be settled on 21 September 2017 in accordance with the terms and conditions of the tender offer memorandum dated 15 June 2017 and the official notice dated 4 August 2017. The bonds re-purchased by Kuoni will be deleted from the main register of the depository.

Following the settlement of the bonds tendered during the extension of the tender offer period on 21 September 2017 and the cancellation of the bonds tendered, the total principal amount of the Kuoni bonds outstanding is reduced to CHF 33,005,000 (corresponding to 16.50% of the total principal amount).

Kuoni has applied for the delisting of its remaining outstanding bonds with SIX Swiss Exchange (SIX) and is awaiting SIX’ decision in this regard.

Final extension of the Period of the Tender Offer by Kuoni Travel Holding Ltd (“Kuoni”) to all holders of the CHF 200,000,000 1.50% bond 2013-2019

04.08.2017

Kuoni announces the final extension of the offer period of its current tender offer to purchase any and all of its outstanding bonds due 28 October 2019 until 14 September 2017.

Kuoni launched on 15 June 2017 a tender offer and invited all holders of its outstanding CHF 200,000,000 1.50% bond due 28 October 2019 to tender their bonds against cash payment of 102% of the par value of the tendered bonds plus accrued interest until the settlement date. The tender offer commenced on 15 June 2017 and, following a first extension of the offer period, expired on 3 August 2017 at 12:00 noon (CEST).

Up to and including 3 August 2017 at 12:00 noon (CEST) Kuoni bonds with an aggregate par value of CHF 4,115,000 have been tendered to Kuoni for redemption. The tendered Kuoni bonds will be settled on 10 August 2017 in accordance with the terms and conditions of the tender offer memorandum dated 15 June 2017 (the “Tender Offer Memorandum“) and the official notice dated 7 July 2017.

Following the settlement of the bonds tendered during the extended tender offer period on 10 August 2017, the total principal amount of the Kuoni bonds outstanding will be reduced to CHF 35,945,000 (corresponding to 17.97% of the total principal amount).

Kuoni has decided to make a final extension of the offering period of its current tender offer; the tender offer is now scheduled to expire on 14 September 2017 at 12:00 noon (CEST). Settlement of the Kuoni bonds tendered during such extended tender offer period is expected to be made on 21 September 2017. All other terms and conditions of the tender offer (incl., but not limited to, the purchase price) remain unchanged during the extended offer period.

Furthermore, Kuoni intends to apply now for the delisting of its bond with SIX Swiss Exchange.

The complete terms and conditions of the tender offer are set out in Tender Offer Memorandum, which may be downloaded at Kuoni’s website (https://kuoni.com/tag/news/) and/or may be obtained free of charge by directing a request to the Sole Dealer Manager, UBS Investment Bank, via email at ol-liabilitymanagement-eu@ubs.com.

Extension of the Period of the Tender Offer by Kuoni Travel Holding Ltd (“Kuoni”) to all holders of the CHF 200,000,000 1.50% bond 2013-2019

07.07.2017

Kuoni announces the extension of the initial offer period to purchase any and all of its outstanding bonds due 28 October 2019 until 3 August 2017.

On 15 June 2017, Kuoni has launched a tender offer and invited all holders of its outstanding CHF 200,000,000 1.50% bond due 28 October 2019 to tender their bonds against cash payment of 102% of the par value of the tendered bonds plus accrued interest until the settlement date.

Up to and including 6 July 2017 at 12:00 noon (CEST) Kuoni bonds with an aggregate par value of CHF 34,230,000 have been tendered to Kuoni for redemption. The tendered Kuoni bonds will be settled on 13 July 2017 (the “Initial Settlement Date“) in accordance with the terms and conditions of the tender offer memorandum dated 15 June 2017 (the “Tender Offer Memorandum“), and the bonds re-purchased by Kuoni will be deleted from the main register of the depository.

Following the settlement of the bonds tendered during the initial tender offer period on the Initial Settlement Date, the total principal amount of the Kuoni bonds outstanding is reduced to CHF 40,060,000 (corresponding to 20.03% of the total principal amount).

Kuoni has decided to exercise its right to extend the initial tender offer period from 6 July 2017 to 3 August at 12:00 noon (CEST). Settlement of the Kuoni bonds tendered during the extended tender offer period is expected to be made on 10 August 2017. All other terms and conditions of the tender offer (incl., but not limited to, the purchase price) remain unchanged during the extended offer period.

As announced on 15 June 2017, upon completion of the tender offer Kuoni intends to apply for the delisting of its bond with SIX Swiss Exchange.

The complete terms and conditions of the tender offer are set out in Tender Offer Memorandum, which may be downloaded at Kuoni’s website (https://kuoni.com/tag/news/) and/or may be obtained free of charge by directing a request to the Sole Dealer Manager, UBS Investment Bank, via email at ol-liabilitymanagement-eu@ubs.com.

Kuoni Group restructures its divisional setup and pre-announces offer to holders of outstanding bond

22.05.2017

As part of the strategy to make each of the Kuoni Divisions independent stand-alone businesses, Kuoni Group has completed a restructuring, whereby Kuoni Travel Holding Ltd has transferred its GTD business division (including MTS) and its GTS business division (including DMS) to its holding company, Kiwi Holding V (Switzerland) Ltd. The divisions are now held by holding companies of the shareholders of Kuoni Group, EQT VII (a fund advised by EQT Partners) and the Kuoni and Hugentobler Foundation. As a consequence of the restructuring, Kuoni Group contemplates to make an offer to the bondholders of its outstanding bond.

In April, Kuoni Travel Holding Ltd. (“KTH“) announced that it entered into a binding agreement on the combination of its GTD business division (excluding MTS Globe) (“GTA“) with the Hotelbeds Group and the sale of its Destination Management Specialists (DMS) to Thomas Cook India Group. As an interim step, on 19 May 2017, the sole shareholder of KTH has resolved on the distribution in kind by KTH of the shares in GTA Travel Holding Ltd (the holding company of the GTD business division, including MTS Globe) and Kuoni Travel Investments Ltd (the holding company of the GTS business division, including DMS) as well as a combined distribution in kind and sale of related shareholder loan receivables to the holding company of KTH, Kiwi Holding V (Switzerland) Ltd. As from today, only the VFS business division will remain with KTH. The distributed business divisions together accounted for a turnover of approx. CHF 2.94 billion in the financial year 2016 (approx. 89% of consolidated turnover for the group) and a gross operating profit of approx. CHF 353.6 million (approx. 58% of consolidated gross operating profit for the group).

Following the restructuring of the divisional setup, KTH contemplates to offer to each holder of the CHF 200,000,000 1.50% bonds 2013-2019, issued by KTH, the possibility to tender such bonds against payment of a consideration in cash. This step is due to the change in the risk profile of the Kuoni Group as described above and is intended to offer bondholders an attractive exit. The tender offer will presumably be launched in the second half of May 2017 and will be announced by separate media release. KTH has received a payment guarantee by Kiwi Holding IV S.à r.l. in order to secure the payment of the consideration for any bonds that will be tendered in the contemplated tender offer. Following the settlement of the bond tender offer, KTH intends to apply for the delisting of the bond with SIX Swiss Exchange; if such application is granted, Kuoni will cease to be subject to the rules of SIX Swiss Exchange and the trading market in the bonds will become less liquid as a result of the delisting.

Kuoni Travel Holding Ltd (“Kuoni”) offers to buy back its outstanding bonds

15.06.2017

Kuoni announces the launch of a cash tender offer for its outstanding CHF 200,000,000 1.50% bond 2013-2019 (Valor 22.294.867). The bonds repurchased will be cancelled.

Today Kuoni has launched a cash tender offer and invited all holders of its outstanding CHF 200,000,000 1.50% bond due 28 October 2019 to tender such bonds for purchase by Kuoni against payment of a consideration equal to 102% of the par value of the tendered bonds, subject to the terms and conditions set out in the tender offer memorandum dated 15 June 2017 (the “Tender Offer Memorandum“).

The tender offer will last from 15 June 2017 to 6 July 2017. The final result of the tender offer will be communicated by separate press release. After completion of the tender offer, the bonds re-purchased by Kuoni will be cancelled. Further, following completion of the tender offer, Kuoni intends to apply for the delisting of its bond with SIX Swiss Exchange; if such application is granted, Kuoni will cease to be subject to the rules of SIX Swiss Exchange and the trading market in the bonds will become less liquid as a result of the delisting.

The rationale of the tender offer for the bonds is – as announced on 22 May 2017 – to grant bondholders an attractive route to exit their investments in the Kuoni bonds. This is in light of the change in the risk profile of the Kuoni Group arising from the restructuring and the disposals of the GTD and GTS business lines as well as the limited liquidity in the secondary market.

The complete terms and conditions of the tender offer are set out in Tender Offer Memorandum, which may be downloaded at Kuoni’s website (https://kuoni.com/tag/news/) and/or may be obtained free of charge by directing a request to the Sole Dealer Manager, UBS Investment Bank, via email at ol-liabilitymanagement-eu@ubs.com.

Kuoni Global Travel Services to be acquired by JTB Corporation

30.05.2017

Kuoni Global Travel Services, a leading provider of Group Travel and Global MICE1 services, announced today that it is to be acquired by JTB Corporation.

The partnership formed between Kuoni Global Travel Services and JTB Corporation will open prospects to become a global No. 1 Destination Management Company2. The transaction will create opportunities to increase business in growing markets across the world through extension of local product offerings and expanding the complementary Global MICE services.

Reto Wilhelm, CEO of Kuoni Global Travel Services said: “JTB is one of the biggest and most respected market players in our industry. Joining JTB provides our company with the best positioned owner, which will help us realize the full potential of Kuoni Global Travel Services. We will be able to further enhance our service and products for customers, while creating scale and efficiency.”

Eijiro Yamakita, President & CEO of the European Regional Headquarters of JTB said: “Kuoni Global Travel Services is one of the world’s leading travel companies with an important presence especially in Asian leisure and corporate groups visiting Europe. The acquisition offers an excellent opportunity to be a unique operator by gathering the network and knowledge. It enables the provision of detailed services to meet each customer’s needs with high added-value and the expansion of the inbound business.”

The parties have agreed not to disclose further details regarding the purchase price or their contract. The acquisition is subject to approval by the relevant competition authorities and compliance with any other local legal requirements. The parties contemplate to complete the transaction once all such approvals have been obtained and all local requirements have been complied with. There will be no imminent changes to the current company structure, and the company entities will continue to operate their businesses independently during the transition period.

1 MICE = Meetings Incentives Conferences Events
2 DMC = Destination Management Company, professional services company possessing extensive local knowledge, expertise and resources, specializing in the design and implementation of events, activities, tours, transportation, etc.

Kuoni’s Destination Management Specialists join Thomas Cook India Group

28.04.2017

Kuoni Global Travel Services (GTS) has signed an agreement with travel provider Thomas Cook India Group to sell Kuoni’s network of Destination Management Specialists (DMS) in Asia, Australia, Middle East, Africa and The Americas.

The global network of Destination Management Specialists consists of six largely independent, entrepreneurially managed units that have expert knowledge of their own regions. The activities encompass the brands AlliedTPro (USA), Asian Trails (South-East Asia), Australian Tours Management (Australia), Desert Adventures/Gulf Dunes (Middle East), and Private Safaris (East Africa, Southern Africa).

Kuoni Destination Management Europe and Kuoni Destination Management US (the Global MICE business) remain in the portfolio of Kuoni Global Travel Services.

The parties have agreed not to disclose further details regarding the purchase price or their contract. The acquisition is subject to approval by the relevant competition authorities. The parties contemplate to complete the transaction once all such approvals have been obtained.

 GTA to join Hotelbeds Group

21.04.2017

Kuoni Group has entered into a binding agreement on the sale of its GTD business division (excluding MTS Globe) (“GTA”) to Hotelbeds Group, owned by a consortium led by Cinven and Canada Pension Plan Investment Board (CPPIB). The shareholders of Kuoni Group will roll-over a large portion of their proceeds from GTA into the combined Hotelbeds/GTA business. Completion of the transaction is subject to customary closing conditions, including merger control filings and approvals. In 2016, GTA’s gross operating profit was CHF 204 million[1] (representing approx. 34% of total gross operating profit of the Kuoni Group).

The purchase price will consist partially in shares of Hotelbeds Group and partially in cash, to be used mainly for repayment of debt and funding of transaction costs. The shareholders of Kuoni Group, EQT VII (a fund advised by EQT Partners), the Kuoni and Hugentobler Foundation and selected members of the management, will roll-over a large proportion of their equity participation in GTA and, upon completion, will hold a substantial minority stake in the combined Hotelbeds/GTA business. The parties have agreed not to disclose further details regarding the purchase price or their contract. The acquisition is subject to approval by the relevant competition authorities. The parties contemplate to complete the transaction once all such approvals have been obtained.

Prior to completion of the transaction, it is contemplated that GTA will be carved-out from the Kuoni Group by way of a combined distribution and sale of all shares in GTA’s holding companies from Kuoni Travel Holding Ltd to its indirect shareholder, Kiwi Holding IV S.à r.l.

[1] Including MTS Globe for the period from 1 December 2016 to 31 December 2016.

Kuoni Group Annual Results 2016

Kuoni Group is a leading service provider to the global travel industry and governments with leading positions in its areas of activity and sustainable growth prospects, with a strong focus on Asia. Kuoni Group generated turnover of CHF 3.28 billion in the 2016 financial year.

Key figures

CHF million 2016 2015
Turnover 3,282.8 3,348.7
Gross profit 608.7 609.7
Gross profit margin (%) 18.5 18.2
Operating earnings (EBIT) 20.9 1 81.2 2
EBIT margin (%) 0.6 2.4
Net result from continuing operations 1.3 57.9
Net result from discontinued operations, net of income taxes 2.8 –352.1 3
Net Result 4.1 –294.2
Free cash flow from continuing operations 51.9 120.3

1 Incl. costs related to the acquisition of Kuoni Travel Holding Ltd through EQT and Kuoni and Hugentobler-Foundation (CHF 25.5 million), as well as costs related to the reorganisation of the Kuoni Group of CHF 10.6 million.

2 Incl. positive contribution of CHF 52.6m from the sale of a property in Zurich in the second half of 2015 compensating for costs of CHF 25.2 million from restructuring of GTS Division (CHF 18.0 million) and support and corporate functions (CHF 7.2 million).

3 Incl. currency translation losses accumulated over the years (CTA) of CHF –219.7 million.

Reto Wilhelm to be new CEO of Kuoni Global Travel Services (GTS)

07.12.2016

Reto Wilhelm is taking over operational management as CEO of Kuoni Global Travel Services (GTS) on 1 March 2017. Under his leadership, GTS’s ongoing reorientation as an independent company and the expansion of its activities in attractive market segments will continue. Walter Gehl, Chairman of the GTS Advisory Board, will continue to manage GTS on an interim basis until March 2017.

“Reto Wilhelm, who is taking over operational management of the business, is very experienced in the global tourism industry and has wide knowledge of GTS’s business activities, particularly in Asian source markets. I’m pleased that we’ve been able to bring in a personality like Reto Wilhelm – someone who knows the complexities of the business done by Group Travel, MICE and our Destination Management Specialists, as well as being very familiar with Kuoni’s international culture,” said Walter Gehl, Chairman of the GTS Advisory Board.

Reto Wilhelm, a Swiss citizen, has worked for the Thomas Cook Group in London and Frankfurt since 2013, and has been General Manager of the travel group’s joint venture activities in China since 2015. Previously, he worked as Managing Director of Western and Eastern Europe at Thomas Cook Group, and was also in charge of the UK and Ireland on an interim basis. In 2010, Reto Wilhelm founded his own consultancy firm, and among other things built up Thomas Cook International in Switzerland as a start-up company in 2011. From 2002 to 2010, Reto Wilhelm was a Member of the Group Executive Board of the Kuoni Group in charge of Europe, Asia and the Style Division. Before that he worked from 1990 onwards in various management functions at Swissair and SAirGroup. Reto Wilhelm has a degree (lic. oec.) from the University of St. Gallen (HSG).

He takes charge of operational management as CEO of GTS on 1 March 2017. GTS has run its business activities independently since the Kuoni Group was taken over by private equity company EQT in May 2016. Under the new leadership of Reto Wilhelm, the company plans to continue expanding its position as a leading global provider in the Group Travel, MICE and Destination Management Specialists businesses in attractive markets.

Kuoni Global Travel Services (GTS) offers destination services, from accommodation, transportation, tours and activities, to venue and event management. GTS is the number one player in the growing group travel market, handling 50 000 leisure tours per year. GTS also has a global network of Destination Management Specialists, consisting of six largely independent and entrepreneurially managed teams, each of which is an expert in its own region (South-East Asia, Australia, the Middle East, East Africa, Southern Africa and the USA).

Cancellation of publicly held Kuoni B Shares and delisting from SIX Swiss Exchange as of 10 November 2016

01.11.2016

By decision dated 13 October 2016, the Commercial Court of the Canton of Zurich cancelled all publicly held registered shares of Kuoni Travel Holding Ltd (Kuoni) with a nominal value of CHF 1.00 each (the Kuoni B Shares) based on article 137 of the Federal Act on Financial Market Infrastructures and Market Conduct in Securities and Derivatives Trading. The decision has become effective on 27 October 2016.

The remaining minority shareholders of the cancelled Kuoni B Shares will be paid a cash compensation in the amount of CHF 370 for each cancelled share, corresponding to the offer price paid by Kiwi Holding IV S.à r.l. in its public tender offer for all publicly held Kuoni B Shares. The settlement and payment of the compensation to the remaining minority shareholders of Kuoni is scheduled to take place on or around
16 November 2016.

By decision dated 12 July 2016, SIX Exchange Regulation approved the de-listing of the Kuoni B Shares from SIX Swiss Exchange. Furthermore, by decision dated 31 October 2016, SIX Exchange Regulation determined that the last day of trading of the Kuoni B Shares will be 9 November 2016, after which the Kuoni B Shares will be delisted from SIX Swiss Exchange.

In addition, by decision dated 31 October 2016, SIX Exchange Regulation granted an extension of the deadline until which certain exemptions from obligations for maintaining listing apply. The deadline was extended from 3 November 2016 until (including) 9 November 2016. Please refer to the media release published on 27 June 2016 for further details of such exemptions.

Expiry of the period to tender the CHF 200,000,000 1.50% bond 2013-2019 issued by Kuoni Reisen Holding AG for redemption at par value

01.07.2016

Kuoni Reisen Holding AG has received tenders for the redemption of bonds with an aggregate par value of CHF 125,710,000.

The settlement of the public tender offer for all publicly held registered shares of Kuoni Reisen Holding AG (“Kuoni“) with a nominal value of CHF 1.00 has caused a change of control within the meaning of the terms and conditions of the bond to occur. Consequently, holders of the CHF 200,000,000 1.50% bond 2013-2019 (Valor 22.294.867) issued by Kuoni had the right, between 31 May 2016 and 30 June 2016, to request via their respective depositary bank the redemption of their bonds by Kuoni at par value plus accrued interest.

According to the notification from UBS AG, up to and including 30 June 2016 bonds with an aggregate par value of CHF 125,710,000 have been tendered to Kuoni for redemption. The tendered bonds will be redeemed with value date 29 August 2016 in accordance with the terms and conditions of the bond, and the intermediated securities (Bucheffekten) will be deleted from the main register of the depository.

Information to holders of the CHF 200,000,000 1.50% bond 2013-2019 issued by Kuoni Reisen Holding AG

28.06.2016

Due to a change of control, bondholders of Kuoni Reisen Holding AG have the right to request the repurchase of their bonds at par value plus accrued interest. With this notice, Kuoni Group would like to draw the bondholders’ attention to certain important circumstances that are relevant when considering the exercise of this right.

Until Thursday, 30 June 2016, holders of the CHF 200,000,000 1.50% bond 2013-2019 issued by Kuoni Reisen Holding AG (“Kuoni”) may exercise the right, through their depositary bank, to require Kuoni to repurchase their bonds at par value plus accrued interest. This right can be exercised because on 19 May 2016, as a consequence of the settlement of the public tender offer for all publicly held registered shares of Kuoni with a par value of CHF 1.00, a change of control within the meaning of the terms and conditions of the bond has occurred.

The settlement of the public tender offer brought about an entirely new situation for Kuoni. Whilst until 19 May 2016, Kuoni was broadly supported by a wide public shareholder base, the company is now un-der the control of a consortium of bidders led by the financial investor EQT, holding 98.02% of the voting rights. On 1 June 2016, the bidding company, Kiwi Holding IV S.à r.l., Luxembourg has filed a squeeze-out claim with respect to the remaining publicly held Kuoni shares (so-called statutory squeeze-out). This procedure aims at bringing 100% of the voting rights under the control of the bidding consortium. Immediately following the squeeze-out, the Kuoni shares will be delisted from the SIX Swiss Exchange.

In connection with the exercise period during which bondholders may request the repurchase of their bonds by Kuoni, which lasts until Thursday, 30 June 2016, Kuoni Group would like to draw the bondhold-ers’ attention to the following important circumstances that are relevant when considering the exercise of this right:

– The public tender offer was in a large part financed by raising financial indebtedness at the level of the bidding company, Kiwi Holding IV S.à r.l., and its parent company Kiwi Holding III S.A., respectively (both Luxembourg). As soon as the consortium of bidders attains 100% of the voting rights of Kuoni, various companies of the Kuoni Group will grant guarantees and security in respect of such financial indebtedness which will cause the leverage at the level of Kuoni to increase significantly. This has caused a change in the risk profile for bondholders, which is, however, not reflected in a corresponding increase in the return of the bond. Bondholders should carefully consider the impact of such increased risk on their financial situation.

– As announced by Kuoni by way of an ad-hoc disclosure dated 27 June 2016, SIX Swiss Exchange has, upon Kuoni’s application, released Kuoni with effect from 27 June 2016 through to 3 November 2016 to a large extent from its disclosure obligations under applicable stock exchange regulations. It is expected that until the end of such period, the statutory squeeze-out as well as the delisting of the shares will have occurred, i.e., it is likely that the disclosure obligations will cease to apply definitely. Accordingly, Kuoni from now on will no longer have to inform the market as an issuer of shares and thus will not have to disclose financial figures, or inform the market about potentially relevant events, to the same extent as hitherto, which might make it more difficult for bondholders to assess the financial and operational situation of Kuoni. Again, bondholders will not be compensated by an increased return of the bond. Bondholders should carefully consider the potentially adverse impact on the information available to them.

– Finally, since the issuance of the bond in the year 2013, the Kuoni Group has ceased all of its traditional activities as tour operator and divested the respective business divisions. Bondholders should duly consider the effects of this operational reorientation of the Kuoni Group – away from business with end customers towards being a pure service provider for business customers – on their investment in the bonds.

Bondholders may exercise their right to require the early repurchase of the bonds held by them by Kuoni through their depositary bank. Questions in connection with such exercise are thus to be directed to the depositary bank with which the respective bonds are held. Instructions of the depositary bank are binding.

For further information regarding the settlement of the public tender offer and the release of Kuoni from certain disclosure requirements under stock exchange regulations please refer to the media releases dated 19 May 2016 and 27 June 2016, respectively.

Exemption from obligations for maintaining its listing

27.06.2016

On 14 June 2016 Kuoni Travel Holding Ltd filed an application for exemption from certain obligations for maintaining its listing. This application was filed following the settlement of the public tender offer by Kiwi Holding IV S.à r.l. for all publicly held registered shares of Kuoni Travel Holding Ltd with a nominal value of CHF 1.00 each (the Kuoni B Shares).

Per decision dated 24 June 2016, SIX Exchange Regulation granted Kuoni Travel Holding Ltd several exemptions limited in time with regard to certain obligations for maintaining its listing.

The content and the duration of these exemptions are reflected in the following extract of the decision of SIX Exchange Regulation (unofficial literal translation). These exemptions enter into force with the publication of the present ad-hoc communication:

Paragraphs I to III of the decision of the SIX Exchange Regulation read as follows:

I.        Subject to para. V [note Kuoni Travel Holding Ltd: reservation of the publication of the present ad hoc-communication], Kuoni Travel Holding Ltd (issuer), Zurich, is exempted from the following obligations for maintaining listing until the expiration of the validity of the Best Price Rule pursuant to art. 10 para. 1 of the Ordinance of the Takeover Board on Public Takeover Offers dated 21 August 2008 (Takeover Ordinance, TOO) in the context of the public tender and exchange offer of Kiwi Holding IV S.à r.l., Luxemburg (Kiwi), for all publicly held registered shares of issuer with a nominal value of CHF 1.00 each (Kuoni B Shares), i.e. until and including 3 November 2016, 11.59 pm:

a.     Publication and submission of the half-year report for the financial year 2016 (art. 50 sqq. of the Listing Rules [LR] in connection with art. 11 sqq. of the Directive on Financial Reporting [DFR] and the Directive on Regular Reporting Obligations for Issuers of Equity Securities (Shares), Bonds, Conversion Rights, Derivatives and Collective Investment Schemes [DRRO]);

b.     Establishment and maintenance of the corporate calendar (art. 52 LR);

c.     Publication of ad-hoc communications (art. 53 LR in connection with the Directive on Ad hoc Publicity [DAH]), exception made of an ad-hoc communication to inform on the delisting date of the registered shares of the issuer as soon as this date is known by the issuer;

d.     Publication of management transactions (art. 56 LR);

e.     Compliance with the following regular reporting obligations (art. 55 LR in connection with art. 9 of the Directive Regular Reporting Obligations [DRRO]: para. 1.08 (4) (change to the web-link to the corporate calendar), para. 2.01 (2) (submission of the half-year report for the financial year 2016), para. 5.02 (reporting of conditional capital).

II.     The exemptions pursuant to para. I begin with the publication of the ad-hoc communication as per the requirements indicated under para. V below.

III.     In case of resurgence of the obligations pursuant to para. I the issuer has to publish and submit to Swiss Exchange Regulation the half-year report for the financial year 2016 within two months upon the date of the resurgence of the obligations pursuant to para. I (art. 50 LR in connection with art. 11 sqq. DFR and art. 9 para. 2.01 (2) DRRO).

Publication of invitation to the Annual General Meeting of Shareholders of Kuoni Travel Holding Ltd.

03.06.2016

The official, complete and legally binding invitation to Kuoni Travel Holding Ltd.’s 90th Annual General Meeting of Shareholders, including all agenda items and proposals, will be posted on 6 June 2016 to shareholders registered in the share register, and will be published on 6 June 2016 in the Swiss Commercial Gazette (Schweizerisches Handelsamtsblatt).

The Annual General Meeting of Shareholders takes place on Monday, 27 June 2016 at 10.00 a.m. (doors open at 9.45 a.m.) at Bär & Karrer AG, Attorneys-at-law, Brandschenkestrasse 90, Zurich. The invitation with all agenda items and explanations (only in German), can be viewed online at: https://kuoni.com/annual-general-meeting-2/

EQT settles takeover of the Kuoni Group

19.05.2016

The public tender offer of EQT of 29 February 2016 for the takeover of the Kuoni Group will be settled today, on 19 May 2016. EQT holds 98.02 percent of the voting rights in Kuoni.

On 29 February 2016, Kiwi Holding IV S.à r.l. (“Kiwi”) published a public tender offer (“Offer”) for all publicly held registered shares of Kuoni Travel Holding Ltd (“Kuoni”). All conditions of the Offer have been fulfilled on today′s settlement date. Kiwi currently holds 98.02 percent of the voting rights and 97.52 percent of the share capital of Kuoni.

Today, on 19 May 2016, the Offer will be settled through the payment of the offer price to the shareholders of Kuoni who tendered their shares under the Offer.

As of today, the new board members Ulf Berg (chairman), Michael Bauer and Thomas Geiser, who were elected at the occasion of the extraordinary general meeting of the shareholders on 2 May 2016, assume their office. All incumbent board members of Kuoni have resigned as of the settlement date of the Offer.

As already announced in the offer prospectus, Kiwi intends to request the cancellation of all publicly held Kuoni B shares outstanding after the settlement of the Offer pursuant to the provisions of the FMIA (squeeze-out). Furthermore, after the settlement of the Offer Kiwi intends to apply with SIX Swiss Exchange for the de-listing of the Kuoni B shares in accordance with the listing rules of SIX Swiss Exchange and for an exemption of certain disclosure obligations under the listing rules of SIX Swiss Exchange until the date of de-listing of the Kuoni B shares.

The settlement of the Offer constitutes a change of control according to the terms of Kuoni’s outstanding CHF 200 million 1.50% bond, which entitles the bondholders to request Kuoni for the repurchase of their bonds at par plus accrued interest. The bondholders will be informed separately by their depository banks on how to exercise their rights. Bondholders are kindly requested to consider the exercise of their rights in light of the envisaged delisting and the expected down rating of Kuoni.

The annual general meeting of Kuoni will be held on 27 June 2016. An invitation will be published separately

Definitive notice of the end result of the public tender offer of
Kiwi Holding IV S.à r.l. for all publicly held registered shares of
Kuoni Travel Holding Ltd

10.05.2016

– Successful completion of the Offer with 87.2% of Kuoni B shares tendered
– Offer price expected to be paid on 19 May 2016

After the expiration of the additional acceptance period on 3 May 2016 at 4 p.m. CEST (“Additional Acceptance Period”) of the public tender offer of Kiwi Holding IV S.à r.l. (“Kiwi”) for all publicly held registered shares of Kuoni Travel Holding Ltd (“Kuoni”) (the “Offer”), Kiwi today has released the definitive notice of the end result. Kiwi has reported that until the end of the Additional Acceptance Period a total of 3,267,343 Kuoni B shares, corresponding to 87.2% of the 3,748,500 Kuoni B shares that are object of the Offer, have been tendered into the Offer.

Taking into account the 1,249,500 Kuoni A shares, the tendered Kuoni B shares and the 357,008 Kuoni B shares purchased by Kiwi and the persons acting in concert with Kiwi outside the Offer between 13 April 2016 and 9 May 2016, the participation of Kiwi and the persons acting in concert with Kiwi amounts to a total of 4,873,851 Kuoni shares (comprising 1,249,500 Kuoni A shares and 3,624,351 Kuoni B shares), corresponding to 97.52% of the voting rights and 96.90% of the share capital of Kuoni as of 9 May 2016.

Except for conditions (e), (g), (h) and (i) of the Offer, which remain in force until the settlement of the Offer, all conditions according to Section A.7 (Conditions) of the offer prospectus are satisfied. The offer price for the Kuoni B shares which were validly tendered during the offer period and the Additional Acceptance Period is expected to be paid on 19 May 2016.

Kiwi has published the offer documents online on http://www.eqt.se/other/eqtbid/eqt-bid

Provisional notice of the end result of the public tender offer of
Kiwi Holding IV S.à r.l. for all publicly held registered shares of
Kuoni Travel Holding Ltd

04.05.2016

– Provisional end result with 87.9% of Kuoni B shares tendered
– Definitive notice of end result expected on 10 May 2016

After the expiration of the additional acceptance period on 3 May 2016 at 4 p.m. CEST (“Additional Acceptance Period”) of the public tender offer of Kiwi Holding IV S.à r.l. (“Kiwi”) for all publicly held registered shares of Kuoni Travel Holding Ltd (“Kuoni”), Kiwi today has released the provisional notice of the end result. According to preliminary figures reported by Kiwi, until the end of the Additional Acceptance Period a total of 3,260,515 Kuoni B shares, corresponding to 87.9% of the 3,708,648 Kuoni B shares that are object of the Offer, have been tendered into the Offer.

Taking into account the 1,249,500 Kuoni A shares and the 39,852 Kuoni B shares, which have already been held by Kiwi or the persons acting in concert with Kiwi on 13 April 2016 and the tendered Kuoni B shares and the 357,008 Kuoni B Shares purchased by Kiwi and the persons acting in concert with Kiwi outside the public tender offer between 13 April 2016 and 3 May 2016, the participation of Kiwi and the persons acting in concert with Kiwi amounts to a total of 4,906,875 Kuoni shares (comprising 1,249,500 Kuoni A shares and 3,657,375 Kuoni B shares), corresponding to 98.2% of the voting rights and 97.7% of the share capital of Kuoni as of 3 Mai 2016.

This end result is preliminary. The definitive notice of the end result is expected to be published on 10 May 2016 in the electronic media, together with a statement as to the satisfaction of the relevant conditions to the Offer.

Kiwi has published the offer documents online on http://www.eqt.se/other/eqtbid/eqt-bid

Ruling of the Swiss Takeover Board of May 2, 2016

04.05.2016

In the context of the submission of April 19, 2016 of Kiwi Holding IV S.à r.l., the offeror of the public tender offer for all publicly held registered shares of Kuoni Travel Holding Ltd with a nominal value of CHF 1, the Swiss Takeover Board has issued the following ruling on May 2, 2016:

1. It is declared that the adjusted shareholder agreement (inclusive contribution agreement) between the Kuoni and Hugentobler Foundation and Kiwi Holding II S.A. complies with the provisions of the FMIA and the implementing ordinances and in view of the offer price of CHF 370 does not violate the best price rule.

2. Kiwi Holding II S.A. has to inform about the adjusted shareholder agreement (inclusive contribution agreement) by means of a press release.

3. Kuoni Travel Holding Ltd has to publish the dispositive of this ruling.

4. The present ruling will be published on the website of the Swiss Takeover Board.

5. The fee chargeable to Kiwi Holding IV S.à r.l. amounts to CHF 25,000.

Kuoni shareholders elect new Members of the Board of Directors and approve amendments to the Articles of Incorporation

02.05.2016

– Ulf Berg, Michael Bauer and Thomas Geiser elected as new Board Members – Ulf Berg new Chairman of the Board of Directors
– All amendments to Articles of Incorporation approved – Shareholder registration limitations and voting right limitations removed
– Public tender offer expected to complete on 19 May 2016

At today’s Extraordinary General Meeting, the shareholders of Kuoni Travel Holding Ltd elected the new Members of the Board of Directors, which now consists of three people.

Ulf Berg and Michael Bauer were elected to the Board of Directors as representatives of EQT and Thomas Geiser as representative of the Kuoni and Hugentobler Foundation. Ulf Berg was elected as the new Chairman of the Board of Directors. Ulf Berg and Michael Bauer were also elected as members of the Compensation Committee. The newly elected Members of the Board of Directors will assume office as of the date of the settlement of the public tender offer, which is expected on 19 May 2016.

The shareholders further approved all the proposed amendments to the Articles of Incorporation, and in particular the removal of the shareholder registration limitations and voting right limitations. The amendments to the Articles of Incorporation are conditional on the success of the public tender offer and will be effective with registration in the commercial register of the canton of Zurich prior to the settlement date of the public tender offer.

All approvals from merger control authorities relevant for the settlement of the public tender offer have been received.

The detailed results of the meeting can be found online here. 

Definitive notice of the interim result of the public tender offer of
Kiwi Holding IV S.à r.l. for all publicly held registered shares of
Kuoni Travel Holding Ltd

19.04.2016

– Definitive interim result with 72.6% of Kuoni B shares tendered
– Public offer declared successful by Kiwi subject to certain offer conditions
– Additional acceptance period to start on 20 April 2016

After the expiration of the initial acceptance period on 13 April 2016 at 4 p.m. CEST (“Initial Acceptance Period”) of the public tender offer of Kiwi Holding IV S.à r.l. (“Kiwi”) for all publicly held registered shares of Kuoni Travel Holding Ltd (“Kuoni”), Kiwi today has released the definitive notice of the interim result. Kiwi has reported that until the end of the Initial Acceptance Period a total of 2,691,184 Kuoni B shares, corresponding to 72.6% of the 3,708,648 Kuoni B shares that are object of the Offer, have been tendered into the Offer.

Taking into account the 1,249,500 Kuoni A shares and the 39,852 Kuoni B shares, which have already been held by Kiwi or the persons acting in concert with Kiwi on 13 April 2016 and the tendered Kuoni B shares, the participation of Kiwi and the persons acting in concert with Kiwi amounts to a total of 3,980,536 Kuoni shares (comprising 1,249,500 Kuoni A shares and 2,731,036 Kuoni B shares), corresponding to 79.6% of the voting rights and 74.6% of the share capital of Kuoni as of 13 April 2016.

With the definitive interim result now available, Kiwi declared today the Offer to be successful, subject to the satisfaction of certain offer conditions as further described in the definitive notice of interim results.

The additional acceptance period for the subsequent acceptance of the Offer will start on 20 April 2016, and is expected to run until 3 May 2016, at 4 p.m. CEST. Subject to the satisfaction of all conditions, the settlement of the offer is expected to take place on 19 May 2016.

The Board of Directors of the Kuoni Group recommends to its shareholders to accept the Offer and to tender the Kuoni B shares during the additional acceptance period.

Kiwi has published the offer documents online on http://www.eqt.se/other/eqtbid/eqt-bid

Provisional notice of the interim result of the public tender offer of
Kiwi Holding IV S.à r.l. for all publicly held registered shares of
Kuoni Travel Holding Ltd

14.04.2016

– Successful initial acceptance period with 72.6% of Kuoni B shares tendered
– Additional acceptance period to start on 20 April 2016

After the expiration of the initial acceptance period on April 13, 2016 at 4 p.m. CEST (“Initial Acceptance Period”) of the public tender offer of Kiwi Holding IV S.à r.l. (“Kiwi”) for all publicly held registered shares of Kuoni Travel Holding Ltd (“Kuoni”), Kiwi today has released the provisional notice of the interim result. Kiwi has reported that according to preliminary figures, until the end of the Initial Acceptance Period a total of 2,691,184 Kuoni B shares, corresponding to 72.6% of the 3,708,648 Kuoni B shares that are object of the Offer, have been tendered into the Offer.

Taking into account the 1,249,500 Kuoni A shares and the 39,852 Kuoni B shares, which have already been held by Kiwi or the persons acting in concert with Kiwi on 13 April 2016 and the tendered Kuoni B shares, the participation of Kiwi and the persons acting in concert with Kiwi amounts to a total of 3,980,536 Kuoni shares (comprising 1,249,500 Kuoni A shares and 2,731,036 Kuoni B shares), corresponding to 79.6% of the voting rights and 74.6% of the share capital of Kuoni as of 13 April 2016.

Therewith, Kiwi and the persons acting in concert with Kiwi hold more than 50% of the capital and 67% of the votes of all issued Kuoni shares which are required to meet one of Kiwi’s key offer conditions.

The definitive notice of the interim result is expected to be published on 19 April 2016, together with a statement as to the satisfaction of the relevant conditions of the Offer.

If the relevant conditions are satisfied, the additional acceptance period for the subsequent acceptance of the Offer will start on April 20, 2016, and is expected to run until May 3, 2016, at 4 p.m. CEST.

The Board of Directors of Kuoni recommends to its shareholders to accept the Offer.

Kiwi has published the offer documents online on http://www.eqt.se/other/eqtbid/eqt-bid

Invitation to the Extraordinary General Meeting of Shareholders
of 2 May 2016 

11.04.2016

– New appointments proposed to Kuoni Group’s Board of Directors
– Removal of voting rights restrictions proposed

In connection with the public tender offer by Kiwi Holding IV S.à.r.l. (EQT/ Kuoni and Hugentobler Foundation) Kuoni Travel Holding Ltd (Kuoni Group) will propose to the Extraordinary General Meet-ing of Shareholders on 2 May 2016 that it appoints a new Board of Directors by electing three new members. They would replace the seven current members, who have already announced that they will be stepping down when the transaction is completed. The proposal is to elect Ulf Berg and Michael Bauer as representatives of EQT, as well as Prof. Dr. Thomas Geiser of the Kuoni and Hugentobler Foundation to the new three-person Kuoni Group Board of Directors. Ulf Berg is additionally being proposed as Chairman of the Board. Shareholders will also be asked to decide on other issues, including removing voting right restrictions on category B registered shares with effect from the settlement date of the public tender offer.

Ulf Berg, who is being proposed for election as the new Chairman of the Board of Directors, has a successful track record in business and is an expert in public corporate governance. He holds a degree in engineering (Dipl.-Ing.) and a doctorate in mechanical engineering. He worked in executive positions at ABB, Gavazzi, SIG and industrial company Sulzer, where he first served as CEO and then as Chairman. He is a board member of Bobst and Chairman of EMS Chemie. Ulf Berg has a wealth of experience in company restructurings, takeovers and integrations. Ulf Berg is partner at the investment company BLR & Partners Ltd. of Zurich/Thalwil and serves on the boards of various EQT portfolio companies.

EQT is also proposing that shareholders elect Michael Bauer as its second representative on the Board of Directors. Since 2009 he is Partner at Investment Advisor EQT Partners in Zurich, where he is amongst others managing EQT’s Swiss presence. He is the responsible Partner at EQT Partners for the Kuoni acquisition and further serves on a number of EQT portfolio company boards as owner representative. Michael Bauer holds a degree in Business Administration from the University of St. Gallen (lic.oec.HSG).

The Kuoni and Hugentobler-Foundation proposes that shareholders elect Prof. Dr. iur. Dr. h.c. Thomas Geiser as a Member of the Board of Directors of Kuoni. After having served for many years at the Swiss Federal Office of Justice and the Swiss Federal Supreme Court in Lausanne, Thomas Geiser became a Professor of Private and Commercial Law at the University of St. Gallen (HSG) and the Managing Director of the Research Institute for Economic and Labour Law FAA-HSG in 1995. Thomas Geiser has been a member of the Foundation Council of the Kuoni and Hugentobler-Foundation since 2002 and therefore followed Kuoni’s development since many years. The Kuoni and Hugentobler-Foundation will be involved as set out in a shareholder’s agreement with EQT and will support the future development of the Kuoni Group.

Further information and curriculums vitae of proposed members of the Board of Directors are available in the invitation online here

The Annual General Meeting of Shareholders of Kuoni Travel Holding Ltd announced for 26 April 2016 will be postponed. It will take place at a later date, which will be announced in due course.

The following agenda items are being presented for voting to the Extraordinary General Meeting of Shareholders of 2 May 2016:

1. Elections

1.1       Election of the Board of Directors
1.1.1    Election of Ulf Berg
1.1.2    Election of Michael Bauer
1.1.3    Election of Thomas Geiser
1.2.      Election of Ulf Berg as Chairman of the Board of Directors
1.3       Election of the Members to the Compensation Committee
1.3.1    Election of Ulf Berg
1.3.2    Election of Michael Bauer

2. Amendments of the Articles of Incorporation

– Article 3bis Conditional Share Capital
– Article 5 Share Register, Restrictions on Transfer of Shares, Nominees
– Article 13 Right to Vote, Representation of Shareholders
– Article 14 Independent Proxy
– Article 16 Supermajority for Important Resolutions

3. Miscellaneous

The official, complete and legally binding invitation to the Extraordinary General Meeting of Shareholders of Kuoni Travel Holding Ltd with all agenda items, proposals and explanations by the Board of Directors is being sent today or via the online platform to shareholders registered in the share register, and is being published in the Swiss Commercial Gazette (Schweizerisches Handelsamtsblatt). This announcement is not an invitation to the Extraordinary General Meeting.

Kuoni Group posts strong organic growth for 2015 
Higher earnings from continuing operations 

15.03.2016

Conference Calls: 
Dial-in numbres for analyst conference 9.30 a.m. CET:
Europe +41 (0)58 310 50 00
UK +44 (0)203 059 5862

Dial-in numbres for media conference 11 a.m. CET:
Europe +41 (0)58 310 50 00
UK +44 (0)203 059 5862

Investor Presentation EN

– CHF 3,349 million turnover, organic growth of +6.9%
– Significant organic turnover growth at Global Travel Distribution, GTD (+9.8%) and VFS Global (+23.3%) Divisions
– Operating earnings before amortisation (EBITA): CHF 124.0 million, +17.3%
– Operating earnings (EBIT): CHF 81.2 million, +6.3% – Net result from continuing operations: CHF 57.9 million
– Net result: CHF -294.2 million, including one-time exceptional effects of the sale of tour operating activities and CHF -219.7 million of related reclassified currency translation losses accumulated over the years (CTA)
– Equity ratio at 32.5%
– Restructuring of Global Travel Services Division (GTS) and adjustment of support and corporate functions are progressing as planned and delivering expected results
– Completion of EQT’s public tender offer expected by mid-year 2016

Key figures

CHF million 2015 2014 1 Change in %
Turnover 3,348.7 3,372.0 –0.7
Gross profit 609.7 612.2 –0.4
Gross profit margin (%) 18.2 18.2  
Operating earnings before amortisation (EBITA) 124.0 35 105.7 17.3
EBITA margin (%) 3.7 3.1  
Operating earnings (EBIT) 81.2 345 76.4 6.3
EBIT margin (%) 2.4 2.3  
Net result from continuing operations 57.9 58.2 –0.5
Net result from discontinued operations, net of income taxes –352.1 6 9.2  
Net Result –294.2 6 67.4  
Free cash flow from continuing operations 120.3 55.1 118.3

1 Restatement of comparative period figures due to the disposal of all outbound tour operating activities and the inbound business in India.

2 Incl. positive contribution from the sale of a property in Zurich in the first half of 2014 in the amount of CHF 10.1 million.

3 Incl. costs of CHF 25.2 million from restructuring of GTS Division (CHF 18.0 million) and support and corporate functions (CHF 7.2 million).

4 Incl. costs of CHF 16.5 million as part of the restructuring of GTS Division (impairment on other intangible assets).

5 Incl. positive contribution of CHF 52.6 million from the sale of the “Neue Hard” property in Zurich.

6 Incl. reclassification of currency translation losses accumulated over the years (CTA) of CHF -219.7 million.

Zubin Karkaria, CEO of Kuoni Group made the following comments:

“The Kuoni Group is reporting a positive increase in organic growth and operating earnings. There were particularly good performances in 2015 from the GTD Division’s businesses dealing with worldwide distribu-tion of hotel accommodation and destination services, and from the visa service provider VFS Global. The restructuring of the GTS Division and the adjustment of support and group functions are progressing as planned and delivering the expected results. The focus on global business-to-business activities in growth markets, initiated in 2015, is developing well. The results are a good starting point for the successful expan-sion of Kuoni’s leading positions under the intended new ownership of private equity company EQT.”

Current trading 2016

As of 6 March 2016, the percentage changes in booking levels and turnover for 2016 compared with the equivalent prior-year period were as follows in Swiss franc (CHF) and local currency (LC) terms:

Continuing operations

Global Travel Distribution (GTD)   CHF +1%    LC 0%

Global Travel Services (GTS)   CHF -8%   LC -9%

VFS Global (number of applications processed)   +2%

Analysts’ and media conference calls on the annual results / 2015 Annual Report online

The following conference calls will be held today for analysts and journalists:

Analysts 9.30 a.m. CET (in English)
Media 11 a.m. CET (mainly in German)

Dial-in numbers:
from Europe +41 (0)58 310 50 00
from the UK +44 (0)203 059 5862

Zubin Karkaria CEO of Kuoni Group, Thomas Peyer, outgoing CFO and Prisca Havranek-Kosicek, new CFO of Kuoni Group, will be presenting the 2015 annual results. All information and the investor presen-tation are available for download today from 7 a.m. CET at kuoni.com.

The complete 2015 Annual Report is available online in German and English here

Kuoni Group figures for 2015

Kuoni Group generated turnover of CHF 3,349 million from continuing operations in the 2015 financial year (20141: CHF 3,372 million). Organic growth was +6.9%. Exchange rate effects had a significant -7.6% nega-tive impact on turnover expressed in Swiss francs, the Group’s presentation currency. The GTD and VFS Global Divisions recorded very positive organic growth of +9.8% and +23.3% respectively. Within the GTS Division (-1.3% organic) group travel business grew organically, while the Destination Management Special-ists saw turnover decline.

Gross profit came to CHF 609.7 million (20141: CHF 612.2 million). The strong Swiss franc had a negative effect of -7.5%. The gross profit margin was stable at 18.2% (20141: 18.2%). VFS Global significantly in-creased its gross profit thanks to strong growth. The GTD Division generated a significant increase in gross profit in the fourth quarter of 2015, which despite the strong negative currency influence led to a slightly higher gross profit for the year as a whole. Meanwhile the GTS Division’s gross profit declined. Lower demand in the key Japanese market had a particularly negative impact.

Operating earnings before amortisation (EBITA) from continuing operations came to CHF 124.03,5 million (20141: CHF 105.72 million). Operating earnings (EBIT) stood at CHF 81.23,4,5 million (20141: CHF 76.42 million). The strong growth and higher gross profit of the GTD and VFS Global Divisions had a positive effect on operating earnings. Results were also boosted by the proceeds of the sale of the “Neue Hard” property in Zurich in the fourth quarter of 2015. By contrast, the restructuring of the GTS Division initiated in November 2015 led to a CHF 16.5 million impairment on other intangible assets as well as additional costs of CHF 3.0 million for IT restructuring. In total restructuring expenses in the GTS Division and for the reduc-tion of support and corporate functions amounted to CHF 25.2 million. Adjusted EBITA came to CHF 96.6 million and adjusted EBIT to CHF 70.3 million. The prior-year results had been boosted by the CHF 10.1 million proceeds of a property sale in Zurich.

Net profit from continuing operations came to CHF 57.93,4,5 million (20141,2: CHF 58.2 million).

The net result from discontinued operations stood at CHF -352.16 million (20141: CHF 9.2 million) incl. tour operators in Switzerland, the UK, Scandinavia/Finland, Benelux, India, Hong Kong and Destination Management India. The sale of tour operating activities resulted in a loss of CHF -132.4 million. This in-cludes the net result from these units, the cost of the sales process and an impairment of goodwill. Most of this loss had no effect on liquidity. At the time the sold tour operating activities were deconsolidated, reclassified currency translation losses accumulated over the years (CTA) came to CHF -219.7 million. The reclassification of CTA had no effect on equity or liquidity.

Cash flow from operating activities from continuing operations came to CHF 74.1 million (20141: CHF 91.6 million). Free cash flow from continuing operations went up significantly to CHF 120.3 million (20141: CHF 55.1 million). This year-on-year increase is mainly due to the sale of the “Neue Hard” property.

Kuoni Group’s equity at 31 December 2015 came to CHF 530.3 million (31.12.2014: CHF 779.2 million). The equity ratio stood at 32.5% (31.12.2014: 32.2%). Equity declined significantly compared to 2014 owing to the loss on the sale of discontinued operations, the distribution against capital reserves, and currency translation losses resulting from the Swiss National Bank’s decision to abandon the minimum exchange rate against the euro.

Net debt as of 31 December 2015 was lower at CHF 54.5 million (2014: CHF 273.8 million), thanks to the sale of the tour operating business and the “Neue Hard” property in Zurich.

As at 31 December 2015, Kuoni Group’s continuing operations had 8,117 employees (FTE, 2014: 7,609 FTE). The increase is due to the strong growth of the GTD and VFS Global Divisions.

Deconsolidation of the sold Asian tour operating activities in the fourth quarter of 2015

With the completion of the sale (closing) of Asian tour operating activities and Destination Management India, Kuoni Group has deconsolidated the assets and debt capital from these areas of business.

Distribution proposed to the Annual General Meeting of Shareholders

As stated in the public tender offer by private equity company EQT on 29 February 2016, any dividend distribution would be deducted from the offer price. The Board of Directors is therefore recommending to the forthcoming Annual General Meeting that no dividend in the form of a withholding tax-free distribution against reserves from capital contributions be paid.

1 Restatement of comparative period figures due to the disposal of all outbound tour operating activities and the inbound business in India.
2 Incl. positive contribution from the sale of a property in Zurich in the first half of 2014 in the amount of CHF 10.1 million.
3 Incl. costs of CHF 25.2 million from restructuring of GTS Division (CHF 18.0 million) and support and corporate functions (CHF 7.2 million).
4 Incl. costs of CHF 16.5 million as part of the restructuring of GTS Division (impairment on other intangible assets).
5 Incl. positive contribution of CHF 52.6 million from the sale of the “Neue Hard” property in Zurich.
6 Incl. reclassification of currency translation losses accumulated over the years (CTA) of CHF -219.7 million.

Income Statement

CHF million 2015 2014 1 Change in %
Continuing operations      
Turnover 3,348.7 3,372 –0.7
Direct costs -2,739.0 -2,759.8 0.8
Gross profit 609.7 612.2 –0.4
Personnel expense –324.3 –323.8 –0.2
Marketing and advertising expense –9.2 –8.1 –13.6
Other operating expense –149.4 –150.9 1.0
Other operating income 53.2 10.1 426.7
Share in result from joint ventures –1.9 –2.0 5.0
Depreciation –28.9 –31.8 9.1
Restructuring expense –25.2 0.0  
Earnings before interest, taxes and amortisation (EBITA) 124.0 35 105.7 2 17.3
Amortisation –26.3 –29.3 10.2
Impairment of other intangible assets –16.5 0.0  
Earnings before interest and taxes (EBIT) 81.2 345 76.4 2 6.3
Financial income 6.7 6.7  
Financial expense –9.0 –6.0 –50.0
Result before taxes 78.9 77.1 2.3
Income tax expense –21.0 –18.9 –11.1
Net result from continuing operations 57.9 58.2 –0.5
       
Net result from discontinued operations, net of income taxes –352.1 6 9.2  
Net Result –294.2 6 67.4  
Of which:      
Attributable to non-controlling interests 0.9 1.0 –10.0
Attributable to shareholders of Kuoni Travel Holding Ltd –295.1 66.4  
       
Earnings per share (in CHF)      
Basic/diluted earnings per registered share A –15.10 3.44  
Basic/diluted earnings per registered share B –75.51 17.20  
Earnings per share from continuing operations (in CHF)      
Basic/diluted earnings per registered share A 2.92 2.97  
Basic/diluted earnings per registered share B 14.59 14.86  

1 Restatement of comparative period figures due to the disposal of all outbound tour operating activities and the inbound business in India.

2 Incl. positive contribution from the sale of a property in Zurich in the first half of 2014 in the amount of CHF 10.1 million.

3 Incl. costs of CHF 25.2 million from restructuring of GTS Division (CHF 18.0 million) and support and corporate functions (CHF 7.2 million).

4 Incl. costs of CHF 16.5 million as part of the restructuring of GTS Division (impairment on other intangible assets).

5 Incl. positive contribution of CHF 52.6 million from the sale of the “Neue Hard” property in Zurich.

6 Incl. reclassification of currency translation losses accumulated over the years (CTA) of CHF -219.7 million

Breakdown of turnover

CHF million 2015 2014 1 Change in % Organic growth in %
Global Travel Distribution (GTD) 1,979.3 1,933.6 2.4 9.8
Global Travel Services (GTS) 1,054.8 1,169.6 –9.8 –1.3
VFS Global 316.5 270.8 16.9 23.3
Turnover eliminations –1.9 –2.0    
Kuoni Group 3,348.7 3,372.0 –0.7 6.9

Breakdown of earnings before amortization (EBITA)

CHF million 2015 2014 1 Change in %
Global Travel Distribution (GTD) 66.7 63.2 5.5
Global Travel Services (GTS) –24.73 1.2  
VFS Global 53.9 52.5 2.7
Corporate 28.1 35 –11.2 2  
Kuoni Group 124.0 35 105.7 17.3

Breakdown earnings (EBIT)

CHF million 2015 2014 1 Change in %
Global Travel Distribution (GTD) 48.0 42.0 14.3
Global Travel Services (GTS) –48.8 34 –6.9  
VFS Global 53.9 52.5 2.7
Corporate 28.1 35 –11.2  
Kuoni Group 81.2 345 76.4 6.3

1 Restatement of comparative period figures due to the disposal of all outbound tour operating activities and the inbound business in India.

2 Incl. positive contribution from the sale of a property in Zurich in the first half of 2014 in the amount of CHF 10.1 million.

3 Incl. costs from restructuring of GTS Division (CHF 18.0 million) and support and corporate functions (CHF 7.2 million).

4 Incl. costs of CHF 16.5 million as part of the restructuring of GTS Division (impairment on other intangible assets).

5 Incl. positive contribution of CHF 52.6 million from the sale of the “Neue Hard” property in Zurich.

Divisions

Global Travel Distribution (GTD)

Turnover came to CHF 1,979 million in 2015 (20141: CHF 1,934 million). Organic growth came to +9.8%. Operating earnings before amortization (EBITA) came to CHF 66.7 million (20141: CHF 63.2 million). Operating earnings (EBIT) stood at CHF 48.0 million (20141: CHF 42.0 million).
A new record of 14.5 million room nights were booked in 2015, which is 6.5% up on the previous year. The strongest growth came from markets in Asia and the Middle East. Both the summer quarter and the fourth quarter saw significant improvements in the gross profit margin. Higher personnel costs and in-vestments in technology resulting from the growth strategy and increased productivity had an impact on operating earnings.

Global Travel Services (GTS)

In the 2015 financial year, the group travel business and Destination Management Specialists generated turnover of CHF 1,055 million (20141: CHF 1,170 million). Organic growth was -1.3%. Operating earnings before amortization (EBITA) came to CHF -24.72 million (20141: CHF 1.2 million). Operating earnings (EBIT) stood at CHF -48.82,3 million (20141: CHF -6.9 million).

In group travel business, positive growth outside Japan, especially in China and Taiwan, resulted in overall organic growth. A total of approximately 3.2 million room nights were booked in 2015, an in-crease of 1.1%. Turnover at the Destination Management Specialists was hit by lower demand from Russia (a result of the depreciation of the rouble), as well as by terror warnings and new visa rules in South Africa for customers from India and China. Our Destination Management Specialists in the Middle East and Africa suffered particularly from these factors. In addition, the strong Swiss franc had a significant negative effect on conversion into the presentation currency, leading to a fall in turnover. The negative operating result (EBIT) was weighed down by the restructuring of the Division. Restructuring is progressing according to plan. The organisational structure has already been adjusted. Management layers and overall headcount have been reduced. Sales strategies have been adapted as well and new pricing processes have now been introduced to increase margins. These measures will have a positive impact on results from 2016. Cost savings and a focus on destination services with higher margins and more profitable orders led to an improvement in operating earnings at Destination Management Specialists.

1 Restatement of comparative period figures due to the disposal of all outbound tour operating activities and the inbound business in India.
2 Incl. costs from restructuring of GTS Division (CHF 18.0 million) and support and corporate functions (CHF 7.2 million).
3 Incl. costs of CHF 16.5 million as part of the restructuring of GTS Division (impairment on other intangible assets).

VFS Global

The visa services provider increased turnover significantly to CHF 316.5 million (2014: CHF 270.8 million). Organic growth came to +23.3%. Operating earnings before amortization (EBITA) and operating earnings (EBIT) came to CHF 53.9 million (2014: CHF 52.5 million).

20.1 million visa applications were processed in 2015, the first time the 20-million mark has been passed within a single year. This represents an increase of 10.1% on the prior-year period. The growth was achieved primarily in the source markets of Asia/Pacific, India, the Middle East and Africa. The difficult economic situation in Russia led to a marked decrease in applications in this source market. A tempo-rary contract with the South African government for administrative processing of residency services for foreigners was carried out as planned in the previous year and into the first half of 2015. As expected this resulted in a dip in growth and earnings in the second half of 2015 because of the high comparative figure.

As at 31 December 2015, VFS Global was operating 1,916 application centres around the world for 48 governments in 123 countries. The joint venture providing visa services for the Kingdom of Saudi Arabia made a small negative contribution to earnings in 2015. The late introduction of biometric visas caused delays in business expansion. In addition, because of existing restrictions on family visas, a lower num-ber of visa applications were processed than originally planned.

Public tender offer by private equity company EQT

On 2 February 2016 EQT announced a public tender offer for all publicly held registered shares of Kuoni Travel Holding Ltd (SIX: KUNN) at a price of CHF 370.00 per share in cash. This offer represents a pre-mium of 34.1% on the current 60-day volume-weighted average price of Kuoni shares (“VWAP”) and a premium of 60.0% on VWAP before Kuoni’s press release of 5 January 2016 in which Kuoni confirmed it was having initial discussions with potential buyers. Kuoni Group’s Board of Directors supports the public tender offer. This decision is based on a comprehensive review and evaluation of all strategic options for creating shareholder value and furthering the company’s interests. The prospectus for the public tender offer, the Board of Directors’ report and the fairness opinion were published on 29 February 2016 and are available electronically at kuoni.com.

The indicative timetable for the transaction is as follows:

15 March – 13 April 2016, 16.00 CET: Acceptance period
14 April 2016: Publication of provisional interim results of tender offer
19 April 2016: Publication of definitive interim results of tender offer
20 April – 3 May 2016, 16.00 CET:  Additional acceptance period of tender offer
2 May 2016: Extraordinary General Meeting of Kuoni Travel Holding Ltd.
4 May 2016: Publication of provisional final results of tender offer
10 May 2016: Publication of definitive final results of tender offer
19 May 2016: Settlement of public tender offer1

1 EQT reserves the right to postpone completion of the offer if the offer conditions have not been met, and in particular if it has not received approval from the competition authorities.

Information about the extraordinary General Meeting of Shareholders on 2 May 2016

The Annual General Meeting of Shareholders of Kuoni Travel Holding Ltd announced for 26 April 2016 will be postponed. It will take place at a later date, which will be announced in due course.

The following tentative agenda items are being presented for voting to the extraordinary General Meeting of Shareholders of 2 May 2016:

1. Elections
1.1. Elections to the Board of Directors
1.2. Election of the Chairman of the Board of Directors
1.3. Election of Members of the Compensation Committee
2. Amendments to Articles of Incorporation
– Article 3b Conditional capital
– Article 5 Share register, transfer restriction, nominees
– Article 13 Voting rights, representation
– Article 14 independent proxy
– Article 16 Qualified majority for important resolutions  
3. Miscellaneous
The official, complete and legally binding invitation to the Extraordinary General Meeting of Shareholders of Kuoni Travel Holding Ltd with all agenda items, proposals and explanations by the Board of Directors is being sent in due course by post or via the online platform to shareholders registered in the share register, and is being published on the respective day in the Swiss Commercial Gazette (Schweizerisches Han-delsamtsblatt). This announcement is not an invitation to the Extraordinary General Meeting.

This information on the 2015 annual results is also available in the original German.
The German version is the authoritative version.

Kuoni Group posts strong organic growth and higher earnings 

29.02.2016

– Private equity company EQT today publishes offer prospectus for public tender offer for the Kuoni Group

– Kuoni Group’s Board of Directors unanimously supports the offer – valuation is fair and adequate

– Kuoni Group publishes provisional, unaudited full-year results for 2015 from continuing operations:

• CHF 3,349 million turnover, organic growth of +6.9%1

• Significant organic turnover growth at Global Travel Distribution, GTD (+9.8%) and VFS Global (+23.3%1) Divisions

• Operating earnings before amortisation (EBITA) up 17.3% to CHF 124.0 million

• Operating earnings (EBIT) up 6.3% to CHF 81.2 million

Kuoni Group releases its provisional, unaudited 2015 full-year results today to coincide with the publication of the offer prospectus for the public tender offer made by private equity company EQT for all publicly held registered shares of Kuoni Travel Holding Ltd and the fairness opinion related therewith. The offer price is CHF 370 per share in cash.

Provisional, unaudited 2015 key figures
Kuoni Group (continuing operations)

CHF million 2015 2014 Change in %
Turnover 3,348.7 3,372.0 – 0.7
Operating earnings before amortisation (EBITA) 124.0 105.7 17.3
Operating earnings (EBIT) 81.2 76.4 6.3

With organic growth of +6.9%1 in 2015, Kuoni Group continues to outperform the market with its continuing activities. Exchange rate effects had a significant negative impact of -7.6% on turnover expressed in Swiss francs, the Group’s presentation currency. As a result, turnover was at the prior-year level at CHF 3,349 million (2014: CHF 3,372 million). The GTD and VFS Global Divisions contributed to the positive organic growth with turnover increases of +9.8% and +23.3%1 respectively.

Operating earnings before amortisation (EBITA) rose to CHF 124.0 million (2014: CHF 105.7 million). Operating earnings (EBIT) improved to CHF 81.2 million (2014: CHF 76.4 million). This includes one-time effects such as the sale of the “Neue Hard” property in Zurich, costs for the restructuring of GTS Division and the support and corporate functions, as well as an impairment of other intangible assets. Operating earnings expectations announced in November 2015 were thus confirmed.

1 Organic growth before adjustment for countries with hyperinflation was +7.3% for the Kuoni Group and +28.4% for VFS Global

Net debt as of 31.12.2015 was lower at CHF 54.5 million (previous year: CHF 273.7 million), thanks to the sale of the tour operating business and the “Neue Hard” property in Zurich.

As per 31 December 2015 the provisional, unaudited, consolidated equity attributable to shareholders of Kuoni Travel Holding Ltd. amounted to CHF 528 million. The consolidated total assets of the Kuoni Group were CHF 1,629 million. The equity ratio was 32.5%.

The 2015 annual results published today are provisional and unaudited. The full, audited annual results and the 2015 Annual Report will be published, as previously announced, on 15 March 2016.

GTD and VFS Global Divisions are major earnings drivers in 2015

The GTD and VFS Global Divisions performed very well in 2015. Both increased their turnover, EBITA and EBIT compared with the previous year. The Global Travel Services (GTS) Division posted a decline in turnover and negative operating earnings. The restructuring of this division, announced and started in November 2015, is progressing according to plan.

Breakdown of provisional turnover (unaudited)

CHF million 2015 2014 Change in % Organic growth in %
Global Travel Distribution (GTD) 1,979.3 1,933.6 2.4 9.8
Global Travel Services (GTS) 1,054.8 1,169.6 –9.8 –1.3
VFS Global 316.5 270.8 16.9 23.3 1
Turnover eliminations –1.9 -2.0    
Kuoni Group 1,531.9 3,372.0 –0.6 6.9 1

1 Organic growth before adjustment for countries with hyperinflation was +7.3% for the Kuoni Group and +28.4% for VFS Global

Breakdown of provisional operating earnings before amortisation (EBITA) (unaudited)

CHF million 2015 2014 Change in %
Global Travel Distribution (GTD) 66.7 63.2 5.5
Global Travel Services (GTS) –24.7 1.2  
VFS Global 53.9 52.5 2.7
Corporate 28.1 –11.2  
Kuoni Group 124.0 105.7 17.3

Breakdown of provisional operating earnings (EBIT) (unaudited)

CHF million 2015 2014 Change in %
Global Travel Distribution (GTD) 48.0 42.0 14.3
Global Travel Services (GTS) –48.8 –6.9  
VFS Global 53.9 52.5 2.7
Corporate 28.1 –11.2  
Kuoni Group 81.2 76.4 6.3

EQT publishes prospectus for public tender offer

On 29 February 2016 private equity company EQT has published the offer prospectus for the public tender offer by Kiwi Holding IV S.à r.l. for all publicly held registered shares of Kuoni Travel Holding Ltd. at a price of CHF 370 per share in cash. The offer prospectus is based on the pre-announcement of 2 February 2016 and is available electronically.

Link to offer prospectus

Based on a comprehensive review and assessment of all strategic options, the Board of Directors of the Kuoni Group had earlier given its unanimous backing to the public tender offer. The Board of Directors’ report, in which it recommends the EQT tender offer to Kuoni shareholders, was published electronically today as part of the offer prospectus.

Link to Board of Directors’ report

On behalf of Kuoni Group’s Board of Directors, N+1 Swiss Capital AG produced a fairness opinion which confirmed that the offered price of CHF 370 per class B registered share is financially fair and adequate. The fairness opinion is available electronically.

Link to fairness opinion

Indicative timetable for the transaction

29 February 2016: Publication of prospectus by EQT
15 March – 13 April 2016, 16.00 CET: Acceptance period
14 April 2016: Publication of provisional interim results
19 April 2016: Publication of definitive interim results
20 April – 3 May 2016, 16.00 CET: Additional acceptance period
4 May 2016: Publication of provisional final results
10 May 2016: Publication of definitive final results
19 May 2016: Settlement of public tender offer*

* EQT reserves the right to postpone the settlement of the public tender offer if the offer conditions have not been met, in particular if the merger control approvals have not been obtained.

Kuoni Group’s Board of Directors supports announced public tender offer by private equity company EQT

02.02.2016

– EQT announces an all cash public tender offer for all publicly held registered shares of Kuoni Travel Holding Ltd. (SIX:KUNN) for a price of CHF 370.00 per share

– The offer represents a premium of 34.1% to the current 60-day volume weighted average share price (“VWAP”) and a 60.0% premium to the VWAP before 5 January 2016, when Kuoni confirmed early stage discussions with potential bidders

– EQT ownership will enable Kuoni Group to accelerate growth and further strengthen its leading market positions

– Kuoni Group CEO Zubin Karkaria and current management team continue to lead the company into the future

– Kuoni and Hugentobler Foundation supports the transaction and remains actively involved

The unanimous decision of Kuoni’s Board of Directors follows a comprehensive review and assessment of all strategic options to create value for shareholders and to further the interests of the company. The Board believes that a take-private of the Kuoni Group under the ownership of private equity company EQT offers highly attractive benefits for its business partners and employees. The transaction enables Kuoni Group to further develop its position as a leading, focused and global travel services provider by investing in technology, in its enhanced service portfolio and in the acquisition of other businesses.

Kuoni has entered into a definitive transaction agreement with an affiliate of EQT, which will launch a public tender offer for CHF 370.00 in cash per registered B share. The planned transaction is to be implemented by a voluntary public tender offer. Today’s announcement follows a competitive process with EQT as well as a number of other interested parties over the course of several weeks.

As long-term investor, EQT will strengthen and expand Kuoni Group’s global business activities

EQT is one of Europe’s leading private equity houses founded by Investor AB, Scandinavia’s largest industrial holding group and part of the Wallenberg Group. EQT is committed to invest in the continued development of the Kuoni Group in order to enable the company to grow and strengthen its position as a leading service provider to the global travel industry and governments and to further increase its profitability. Group CEO Zubin Karkaria together with the current management team will continue to lead the company. The operational measures announced in November 2015 to accelerate the implementation of the defined strategy will be carried out as planned in 2016. With the agreed public to private transaction of Kuoni Group, suppliers, customers and governments will continue to benefit from Kuoni’s innovative strength, its attractive service portfolio, investments in technology and the acknowledged quality of its global offerings. Existing business relationships will continue as before.

Heinz Karrer, Chairman of Kuoni Group’s Board, comments: “Over the last months the Board has very carefully analysed all strategic options in order to secure the successful implementation of Kuoni Group’s strategy. As a result of this detailed and comprehensive analysis and a competitive process, the Board concluded unanimously that taking Kuoni private and handing over the responsibility for the group to an internationally renowned new owner with comprehensive experience in managing and further developing industry leaders, with the necessary financial strengths and with a long term perspective would be the ideal solution to the benefit of all stakeholders. EQT fulfils all these requirements in the best possible way.”

Michael Bauer, Partner at EQT Partners in Zurich said: “EQT is proud of taking over the responsibility for the further successful development of one of the world’s leading travel services provider. We follow an industrial, long-term oriented approach when investing into companies to build sustainable market leaders. It is our ambition to enable the Kuoni Group to strengthen the market position of its businesses, both through organic growth and acquisitions, and to further increase the attractiveness of the Kuoni Group for clients, business partners and employees. This marks the starting point of a very promising era for Kuoni to continue to build successfully on its 110 years long journey.”

Zubin Karkaria, CEO of Kuoni Group: “We welcome EQT’s investment in the Kuoni Group, which underlines the attractiveness of our business activities. With the new owners we will be able to accelerate the implementation of our strategy. Investments in technology and supporting acquisition opportunities give the Kuoni Group an excellent platform to build further on its leadership positions in travel industry services. EQT has an impressive track record of growing companies. With access to their experience and network in both the travel and tech industries, we will be able to accelerate the implementation of Kuoni’s strategy.”

Kuoni and Hugentobler Foundation and EQT jointly guide Kuoni into the future

The Kuoni and Hugentobler Foundation, Kuoni Group’s long-term anchor shareholder, welcomes the Board’s decision and supports the public takeover offer from EQT. The Foundation continues to remain actively involved in Kuoni, in accordance with the Foundation’s purpose to ensure the long-term stability and integrity of Kuoni. Kuoni Group’s Board takes note that EQT and the Foundation have entered into a respective agreement on 1 February 2016. The joint management of Kuoni Group by EQT and the Foundation, the key pillars of Kuoni Group’s future development and the Foundation’s future involvement in Kuoni will be set out in this agreement. Key terms of the agreement will be disclosed in the offer prospectus.

Karl Hofstetter, Chairman of the Board of Trustees of the Kuoni and Hugentobler Foundation: “The strategy jointly targeted together with EQT for the sustainable development of the Kuoni Group is convincing and accords with the Foundation’s purpose. The Board of Trustees supports the takeover offer. We also reaffirm our intention to remain invested in Kuoni as long-term shareholder.”

Pre-announcement of binding offer from EQT to all shareholders of Kuoni Travel Holding Ltd

The public tender offer is subject to a minimum acceptance threshold of at least 67% of Kuoni’s voting rights and more than 50% of its total share capital (with the inclusion of the shares held by Kuoni and Hugentobler Foundation), the deletion of the share transfer and voting right restrictions in the articles of association, to be approved by an Extraordinary General Meeting of the shareholders, which is expected to be held at the beginning of April 2016. In addition, the offer is subject to the approval of the merger control authorities and other customary conditions as well.

The pre-announcement of the tender offer has been issued in the electronic media today. Further in-formation on this offer is expected to be published on 22 February 2016. On the same day the offer prospectus is scheduled for publication. The acceptance period for the public tender offer is expected to commence on 8 March 2016 and to end on 6 April 2016.

The Board has agreed to resign in case of the success of the public tender offer. Subject to successful completion of the offer, it is intended that Kuoni will delist its shares from the SIX Swiss Exchange.

In the light of these developments, the ordinary Annual General Meeting of Shareholders announced for 26 April 2016 will not take place and will be moved to a later date. Any dividend declared at such later 2016 Annual General Meeting of Shareholders will be deducted from the offer price. If the offer is successful, completion of the transaction and delisting from the stock exchange (SIX: KUNN) is expected in the 2nd or 3rd quarter of 2016.

Operational measures to accelerate the implementation of the strategy progress as planned

The operational measures announced in November 2015 are unchanged and the implementation progresses according to the previously announced plan. The GTS Division is being restructured in 2016; group and support functions are being adjusted. The GTD Division is focusing on improving margins and introducing new tools and services to give customers easy access to travel services. VFS Global will continue to innovate and to invest in technology and services to further enhance its successful visa business and additional services.

In connection with the strategic review and the announced public offer, Kuoni Group was advised by Credit Suisse and Morgan Stanley as financial advisers and Homburger as legal advisers.

Conference calls for media and analysts/investors

The following conference calls will be held today 2 February 2016 for journalists and analysts/investors:

08.30h CET for media representatives (in German)
14.00h CET for analyst/investors (in English)

Kuoni Group’s Chairman Heinz Karrer and Michael Bauer, Partner at EQT Partners will comment on the decision, the public tender offer and on Kuoni’s future development.

Dial-in information:

+41 (0)58 310 50 00 (Europe)
+44 (0)203 059 58 62 (UK)
+1 (1)631 570 5613 (USA)

Kuoni Group statement regarding recent media speculations

05.01.2016

Kuoni Group’s Board of Directors has taken notice of the recent media speculations around a potential takeover of the company. The Board confirms that it has received preliminary approaches from third parties regarding a potential offer for the Kuoni Group and its businesses.

Discussions are at a preliminary stage and there can be no certainty at this stage that an offer will be made, nor as to the terms on which any offer might be made. The Board of Directors is evaluating the situation, also taking into consideration all other strategic possibilities.

The measures to accelerate the implementation of the strategic direction, communicated 5 November 2015, are unchanged. It is the Executive Board’s task to develop the operational businesses of all divisions as communicated.

Further information is not available at present and would be given as and when appropriate.

Completion of sale of travel activities in India to Fairfax/Thomas Cook India 

16.12.2015

The sale of travel activities in India to Fairfax/Thomas Cook India was completed on 16 December 2015 after the responsible authorities gave their unconditional approval to the transaction. Canadian group Fairfax, with its travel services provider Thomas Cook India, is taking over Kuoni Group’s traditional tour operating activities and inbound business (Destination Management India) in India. It is taking on the employees and locations, and continues the business activities.

With this step Kuoni Group has completed the sale of all its traditional tour operating activities in Europe, India and Hong Kong as planned in 2015.

Sale of Kuoni Group’s head office building in Zurich

15.12.2015

On 15 December 2015 Kuoni Group sold its “Neue Hard” property in Zurich to Zürcher Kantonalbank. The sale price is CHF 75 million, which matches the estimated market value.

All existing rental agreements are being taken over by Zürcher Kantonalbank. Employees of Kuoni Group in Switzerland are expected to move into the new head office in Zurich-Oerlikon in the second half of 2016.

By selling the property for CHF 75 million Kuoni Group has achieved the estimated market value it previously communicated. The mortgage of CHF 15.0 million has been paid off. Expected operating earnings (EBITA and EBIT) for the 2015 financial year, communicated on 5 November 2015, will increase by about CHF 52 million respectively. The sale has a positive impact on the net result of about CHF 40 million. At present the Kuoni Group expects a net debt of less than CHF 90 million as per year-end 2015.

The sale of the “Neue Hard” building and two other properties in Zurich over the last few years completes Kuoni Group’s streamlining of its real estate portfolio in Switzerland.

Completion of sale of tour operating activities in Hong Kong to Fairfax/Thomas Cook India 

09.11.2015

The sale of tour operating activities in Hong Kong to Fairfax/Thomas Cook India was completed on 9 November 2015 after the responsible authorities gave their unconditional approval to the transaction earlier. Canadian group Fairfax, with its travel services provider Thomas Cook India, is taking over Kuoni Group’s traditional tour operating activities in Hong Kong. It is taking on the employees and locations, and continuing the business activities.

The completion of the transaction for the Indian travel activities that have been sold to Fairfax/Thomas Cook India as well is still expected to be completed by the end of 2015, subject to approval from the competent authorities.

Kuoni Group continues to grow faster than the market – Third quarter earnings confirm the strategy – GTS Division being restructured

05.11.2015

With its new direction Kuoni Group posted strong organic turnover growth of +8.0% in the important third quarter. All divisions contributed to the growth, particularly Global Travel Distribution (GTD) and VFS Global Divisions. Gross profit margin increased in the summer quarter from 16.6% to 17.1% compared to prior-year. GTD Division increased its operating earnings (EBIT) by +28.3% compared to the same period in 2014. Loss-making Global Travel Services (GTS) Division is being restructured extensively. Overall third quarter earnings confirm the new direction of Kuoni Group as a service provider to the global travel industry and governments.

Third quarter 2015

– +8.0% organic turnover growth

– Significant increase in EBIT at GTD Division in summer quarter (+28.3%)

– Restructuring of loss-making GTS Division initiated

– Sale of European tour operating activities completed and deconsolidated

– Equity ratio of 23.8% as at 30.9.2015 (30.6.2015: 18.5%)

First nine months of 2015

– CHF 2,560 million turnover from continuing operations, organic growth of +7.6%

– Strong Swiss franc had -7.7% negative impact on turnover

– Strong organic turnover growth at GTD (+10.6%) and VFS Global (+26.2%) Divisions

– Earnings before amortisation (EBITA): CHF 56.5 million Operating earnings (EBIT): CHF 20.5 million

– Net result from continuing operations: CHF 12.0 million Net result: CHF -293.3 million, including one-off effects from sale of European tour operating activities and reclassification of over the years accumulated currency translation losses (CTA) of CHF 160.6 million at time of deconsolidation

Outlook 2015

CHF million EBITA EBIT
Underlying ≥75 ≥50
Impairment of other intangible assets 1 –3 –19
Restructuring cost –20 –20
Expected full year results 2015 ≥52 ≥11

1 Incl. charges due to realignment of IT structure as part of restructuring of GTS Division, charged in 3rd quarter 2015.

For 2015 financial year underlying operating earnings before amortisation (EBITA) of CHF 75 million or higher and underlying EBIT of CHF 50 million or higher are expected, being above the expectations communicated. The non-recurring charges as part of the significant restructuring of GTS Division contains an impairment of other intangible assets and cost due to realignment of IT structure in total of CHF 19 million, both charged in third quarter 2015. Restructuring costs at GTS Division and cost due to reduction of support and corporate functions of CHF 20 million in total will likely be charged in fourth quarter 2015. Taking in account these one-off charges, the EBITA is expected to be CHF 52 million or higher and EBIT of CHF 11 million or higher.

The sale of Asian tour operating activities (India/Hong Kong) is expected to be completed (Closing) in the fourth quarter of 2015, subject to approval by responsible authorities. At the point of deconsolidation this will lead to a high single-digit million gain in the net result. On the other hand, the net result will be reduced by the reclassification of over the years accumulated currency translation losses (CTA). This accounting effect does not affect the equity or cash position. By the end of September 2015 the CTA came to CHF 49 million.

Further a normal development of free cash flow, comparable exchange rates and no further cash relevant real estate disposal, the estimated Net Debt Position for year end 2015 is expected to be between CHF 200 million and CHF 250 million.

Key figures

  3rd quarter 9 months
CHF million 1.7.-30.9.2015 1.7.-30.9.2014 1.1.-30.9.2015 1.1.-30.9.2014 1
Turnover 1,056.4 1,055.3 2,559.9 2,561.9
Gross profit 180.6 175.5 451.3 457.0
Gross profit margin (%) 17.1 16.6 17.6 17.8
Operating earnings before amortisation (EBITA) 41.9 3 44.6 56.3 3 88.4
EBITA margin (%) 4.0 4.2 2.2 3.5
Operating earnings (EBIT) 19.0 4 37.3 20.5 4 66.4
EBIT margin (%) 1.8 3.5 0.8 2.6
Net result from continuing operations 7.8 30.3 12.0 56.6
Net result from discontinued operations, net of income taxes – 129.0 5 36.2 – 305.3 5 – 4.1
Net Result – 121.2 66.5 – 293.3 52.5
Free cash flow from continuing operations    38.0 136.2

1 Restatement of comparative period figures due to the decision to sell all outbound tour operating activities and the inbound business activities in India.

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014.

3 Incl. CHF 3.0 million charges due to realignment of IT structure as part of restructuring of GTS Division.

4 Incl. charges of CHF 19.4 million as part of restructuring of GTS Division (Impairment of other intangible assets of CHF 16.4 million plus CHF 3.0 million realignment of IT structure).

5 Incl. CTA of CHF -160.6 million.

Heinz Karrer, Chairman of Kuoni Group, made the following comments:

“All divisions recorded positive organic turnover growth in the important summer quarter. In particular, the GTD Division recorded a significant increase of operating earnings (EBIT) in the third quarter by more than a quarter compared with the previous year. Visa services provider VFS Global posted impressively strong turnover growth. GTS Division is being extensively restructured, due to a lack of profitability, triggered by the changed market situation, particularly in the Japanese group travel market. The objective is to return the division to profit and increase flexibility so that it can respond quickly to changing market conditions in the future.”

Current trading 2015

As of 25 October 2015, the percentage changes in booking levels and turnover for this year compared with the equivalent prior-year period were as follows in Swiss franc (CHF) and local currency (LC) terms:

Continuing operations CHF LW
Global Travel Distribution (GTD)  +2% +9%
Global Travel Services (GTS) –9% 0%
VFS Global (Number of applications processed)   +11%

Kuoni Group figures in the first nine months 2015

Kuoni Group generated turnover of CHF 2,560 million in the first nine months of 2015 (20141: CHF 2,562 million). Organic growth was +7.6%. Exchange rate effects had a significant negative impact of -7.7% on turnover expressed in Swiss francs, the Group’s presentation currency. The GTD and VFS Global Divisions recorded positive organic growth of +10.6% and +26.2% respectively. Within the GTS Division, the Group Travel business grew organically by +4.6%, while the Destination Management Specialists saw a decline in turnover.

Gross profit came to CHF 451.3 million (20141: CHF 457.0 million). The conversion into Swiss francs had a negative effect of -7.2%. The gross profit margin was stable at 17.6% (20141: 17.8%). VFS Global significantly increased its gross profit thanks to strong growth. The targeted marketing activities in the first half of 2015 used by the GTD Division to accelerate growth came to an end as scheduled, leading to higher gross profit in the important summer quarter compared to the previous year. However, in the GTS Division, gross profit declined. Lower demand in the Japanese market had a particularly negative impact.

Earnings before amortisation (EBITA) came to CHF 56.53 million (20141,2: CHF 88.4 million). Earnings before interest and taxes (EBIT) came to CHF 20.54million (20141,2: CHF 66.4 million). The lower gross margin at the GTD Division (exclusively in the first half of 2015) and GTS Division, and the higher cost of the growth strategy in the GTD and VFS Global Divisions had a negative effect on operating earnings. The restructuring of the GTS Division has led to the abandonment of a planned IT system and therefore led to an impairment of other intangible assets in the amount of CHF 16.4 million and an additional charge of CHF 3.0 million due to realignment of IT structure (see page 5). Prior-year results were boosted by the CHF 10.1 million from the sale of a property in Zurich.

Net result from continuing operations came to CHF 12.04 million (20141: CHF 56.6 million).

The net result from discontinued operations stood at CHF -305.35 million (20141: CHF -4.1 million), including the outbound tour operators in Switzerland, the UK, Scandinavia/Finland, Benelux, India and Hong Kong, as well as Destination Management India. This includes non-recurring effects, as communicated in June when the European tour operating activities were sold. These effects include the net result of these units, the cost of the sales process, impairment of goodwill, and the reclassification of over the years accumulated currency translation losses (CTA) at the time of the deconsolidation of the sold tour operator activities. The majority of these charges is not cash-effective. In addition, CTA have no impact on equity.

Operating cash flow from continuing operations came to CHF 57.2 million (20141: CHF 160.4 million). Free cash flow from continuing activities came to CHF 38.0 million (20141: CHF 136.2 million). The year-on-year decline is due to lower operating earnings (EBIT) and changes in working capital. Strong organic turnover growth in third quarter led to higher accounts receivable positions.

Kuoni Group’s equity at 30 September 2015 came to CHF 481.9 million (31.12.2014: CHF 779.2 million). The equity ratio stood at 23.8% (31.12.2014: 32.2%). Equity declined significantly compared to 2014 owing to the negative net result, the distribution against capital reserves, and currency translation losses (CHF -100.6 million) resulting from the Swiss National Bank’s decision to abandon the minimum exchange rate against the euro.

As at 30 September 2015, Kuoni Group’s continuing activities had 8,095employees (FTE) (2014: 7,474 FTE). The increase is due to the strong growth of VFS Global Division.

Third quarter 2015

Turnover came to CHF 1,056 million (2014: CHF 1,055 million), with organic growth of +8.0%. All divisions generated positive organic turnover development. The gross profit margin increased to 17.1% (2014: 16.6%). Operating earnings before amortisation (EBITA) came to CHF 41.93 million (2014: CHF 44.6 million). Operating earnings (EBIT) stood at CHF 19.04 million (2014: CHF 37.3 million). The GTD Division increased its operating earnings (EBIT) in the summer quarter by more than a quarter. Due to a time-bound project for the South African authorities in the same quarter of the previous year, VFS Global’s EBIT was lower in the third quarter 2015. EBIT at the GTS Division was reduced by one-time impairment of other intangible assets in the amount of CHF 16.4 million and a CHF 3.0 million charge due to realignment of IT structure connected with restructuring measures.

Restructuring of the GTS Division

The aim of restructuring the GTS Division is to rapidly adjust to changed market conditions through more flexible and cost-efficient structures. Management structures will be adapted, complexity reduced, operational back-office activities outsourced and services that do not add value will be discontinued. Sales activities will be streamlined, simplified and focused on more profitable customer segments. The existing IT architecture has been reviewed and will be adapted to cater for this. The planned new, end-to-end IT solution for Group Travel covering all of the current services is no longer deemed fit for purpose and as a result has been terminated. The GTS restructuring will primarily take place within Group Travel. This requires the relocation of various activities and will result in a global reduction of around 350 full-time posts, which will be achieved through natural attrition but also through redundancies. This restructuring programme is expected to reduce the cost base sustainably by more than CHF 30 million. Anticipated, non-recurring restructuring costs amount to CHF 15 million, which is likely to impact results in 2015, but will be mainly cash-positive in 2016. The realignment of the existing IT architecture and termination of the planned IT solution will already have an additional negative impact of CHF 19 million on the third quarter 2015 results.

Deconsolidation of the sold European tour operating activities

Following the completion of the sale of the European tour operating activities (Closing) Kuoni Group has deconsolidated all assets and liabilities related to these businesses. Such assets and liabilities included goodwill before impairment of CHF 218.7 million, pension liabilities of CHF 67.2 million, advance payments by customers CHF 314.5 million and off-balance sheet contingencies of CHF 466 million (bank guarantees, parental guarantees and collateralised cash). In addition, over the years accumulated currency translation losses (CTA) of CHF 160.6 million have been reclassified from the other comprehensive income to net result from discontinued operations.

Kuoni Group figures

Income Statement

  3rd quarter 9 months
CHF million 1.7.-30.9.2015 1.7.-30.9.2014 1.1.-30.9.2015 1.1.-30.9.2014 1
Continuing operations        
Turnover 1,056.4 1,055.3 2,559.9 2,561.9
Direct costs – 875.8 – 879.8 – 2 108.6 – 2 104.9
Gross profit 180.6 175.5 451.3 457.0
Personnel expense – 87.5 – 80.6 – 252.7 – 238.8
Marketing and advertising expense – 2.0 – 2.0 – 6.6 – 6.5
Other operating expense – 39.2 – 39.8 – 113.4 – 98.4 2
Share in result from joint ventures – 2.3 – 0.9 0.2 – 1.7
Depreciation – 7.7 – 7.6 – 22.3 – 23.2
Earnings before interest, taxes and amortisation (EBITA) 41.9 3 44.6 56.5 3 88.42
Amortisation – 6.5 – 7.3 – 19.6 – 22.0
Impairment of other intangible assets – 16.4 0.0 – 16.4 0.0
Earnings before interest and taxes (EBIT) 19.0 4 37.3 20.5 4 66.4 2
Financial income 1.1 – 2.7 4.7 5.7
Financial expense – 5.1 4.2 – 6.3 – 5.3
Result before taxes 15.0 38.8 18.9 66.8
Income tax expense – 7.2 – 8.5 – 6.9 – 10.2
Net result from continuing operations 7.8 30.3 12.0 56.6
         
Net result from discontinued operations, net of income taxes – 129.0 36.2 – 305.3 – 4.1
         
Net Result – 121.2 66.5 – 293.3 52.5
Of which:        
Attributable to non-controlling interests 0.3 0.4 0.6 0.7
Attributable to shareholders of Kuoni Travel Holding Ltd – 121.5 66.1 – 293.9 51.8
         
From continuing and discontinued operations:        
Basic / diluted earnings per registered share A –6.22 3.42 –15.05 2.68
Basic / diluted earnings per registered share B –31.09 17.12 –75.23 13.42
         
From continuing operations:        
Basic / diluted earnings per registered share A 0.38 1.56 0.58 2.91
Basic / diluted earnings per registered share B 1.92 7.80 2.90 14.53

1 Restatement of comparative period figures due to the decision to sell all outbound tour operating activities and the inbound business activities in India.

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014.

3 Incl. CHF 3.0 million charges due to realignment of IT structure as part of restructuring of GTS Division.

4 Incl. charges of CHF 19.4 million as part of restructuring of GTS Division (Impairment of other intangible assets of CHF 16.4 million plus CHF 3.0 million realignment of IT structure).

Breakdown of turnover

  3rd quarter 9 months
CHF million 1.7.-30.9.2015 1.7.-30.9.2014 Organic Growth in % 1.1.-30.9.2015 1.1.-30.9.2014 1 Organic Growth in %
Global Travel Distribution 621.1 602.2 10.1 1,494.0 1,450.3 10.6
Global Travel Services 349.5 382.0 1.3 823.1 916.7 – 1.3
VFS Global 86.3 75.3 21.7 244.4 202.4 26.2
Turnover elimination – 0.5 – 4.2 – 1.6 – 7.5
Kuoni Group 1,056.4 1,055.3 8.0 2,559.9 2,561.9 7.6

1 Restatement of comparative period figures due to the decision to sell all outbound tour operating activities and the inbound business activities in India.

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014.

3 Incl. CHF 3.0 million charges due to realignment of IT structure as part of restructuring of GTS Division.

4 Incl. charges of CHF 19.4 million as part of restructuring of GTS Division (Impairment of other intangible assets of CHF 16.4 million plus CHF 3.0 million realignment of IT structure).

5 Incl. CTA of CHF -160.6 million.

Breakdown of operating earnings before amortisation (EBITA)

  3rd quarter 9 months
CHF million 1.7.-30.9.2015 1.7.-30.9.2014 1.1.-30.9.2015 1.1.-30.9.2014 1
Global Travel Distribution 30.0 24.9 42.5 50.8
Global Travel Services 5.6 3 8.2 – 14.1 3 0.1
VFS Global 12.9 16.9 45.5 43.4
Corporate – 6.6 – 5.4 – 17.4 – 5.9 2
Kuoni Group 41.9 3 44.6 56.5 3 88.4

1 Restatement of comparative period figures due to the decision to sell all outbound tour operating activities and the inbound business activities in India.

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014.

3 Incl. CHF 3.0 million charges due to realignment of IT structure as part of restructuring of GTS Division.

4 Incl. charges of CHF 19.4 million as part of restructuring of GTS Division (Impairment of other intangible assets of CHF 16.4 million plus CHF 3.0 million realignment of IT structure).

5 Incl. CTA of CHF -160.6 million.

Breakdown of operating earnings (EBIT)

  3rd quarter 9 months
CHF million 1.7.-30.9.2015 1.7.-30.9.2014 1.1.-30.9.2015 1.1.-30.9.2014 1
Global Travel Distribution 25.4 19.8 28.6 34.9
Global Travel Services – 12.7 4 6 – 36.24 – 6.0
VFS Global 12.9 16.9 45.5 43.4
Corporate – 6.6 – 5.4 – 17.4 – 5.9 2
Kuoni Group 19.0 4 37.3 20.5 4 66.4

1 Restatement of comparative period figures due to the decision to sell all outbound tour operating activities and the inbound business activities in India.

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014.

3 Incl. CHF 3.0 million charges due to realignment of IT structure as part of restructuring of GTS Division.

4 Incl. charges of CHF 19.4 million as part of restructuring of GTS Division (Impairment of other intangible assets of CHF 16.4 million plus CHF 3.0 million realignment of IT structure).

5 Incl. CTA of CHF -160.6 million.

Divisions

Global Travel Distribution (GTD)

Turnover for the first nine months of 2015 came to CHF 1,494 million (20141: CHF 1,450 million). Organic growth came to 10.6%. Operating earnings before amortisation (EBITA) came to CHF 42.5 million (20141: CHF 50.8 million). Operating earnings (EBIT) stood at CHF 28.6 million (20141: CHF 34.9 million).

Around 11 million room nights were booked in the first nine months of 2015, an increase of 7.5% compared to the same period of the previous year. Bookings were up in all source markets. The strongest growth came from markets in Asia, the Middle East and Africa, and in particular from beach destinations with 21% growth in bookings. Destination services portfolio (transfers, tours, activities) increased to 15,000 offerings. Accommodation at beach destinations and travel services at locations had a 15% share of turnover after nine months 2015. The targeted marketing activities designed to accelerate growth came to an end as scheduled in the first half of 2015, leading to higher gross profit in the summer quarter compared with the previous year. Higher personnel costs and investments in technology resulting from the growth strategy and increase in productivity had an impact on operating earnings.

Global Travel Services (GTS)

Turnover in the first nine months of 2015 in Group Travel and Destination Management Specialists came to CHF 823 million (20141: CHF 917 million). Organic growth was -1.3%. Operating earnings before amortisation (EBITA) came to CHF -14.13 million (20141: CHF 0.1 million). Operating earnings (EBIT) stood at CHF -36.24 million (20141: CHF -6.0 million).

In Group Travel, positive growth outside Japan, especially in China and Taiwan, resulted in overall organic growth of +4.6%. However, the strong Swiss franc had a negative effect on conversion into the presentation currency, leading to a decline in turnover. Lower gross profit in the Japanese market brought down the operating result. The negative operating result (EBIT) was also affected by the initiated restructuring of the Division. A total of approximately 2.6 million room nights were booked in the first nine months of 2015, an increase of 4.3%.

At the Destination Management Specialists geopolitical events and weak demand from Russia had a negative effect on turnover. Destination Management Specialists in the Middle East and Africa have been affected in particular. Turnover increased in the USA and Asia/Pacific by contrast. Cost savings and a focus on destination services with higher margins and more profitable orders led to an improvement in operating earnings.

VFS Global

The visa service provider increased turnover significantly to CHF 244 million (2014: CHF 202 million). Organic growth came to +26.2%. Operating earnings before amortisation (EBITA) and operating earnings (EBIT), both came to CHF 45.5 million (2014: CHF 43.4 million).

About 15.9 million visa applications were processed in the first nine months of 2015, an increase of 11.3% compared to the same period last year. This growth was achieved primarily in the source markets of South America, India, the Middle East and Africa. A time-bound project with the South African authorities for administrative processing of citizen services for foreigners was completed as planned over the second half of 2014 and first half of 2015. As expected, due to high basis of comparison, this resulted in a dip in growth and earnings in the third quarter of 2015. The difficult economic situation in Russia led to a marked decrease in applications in this source market.

As of 30 September 2015, VFS Global was operating 1 837 application centres around the world for 48 governments in 122 countries. The joint venture providing visa services for the Kingdom of Saudi Arabia generated positive numbers in the first half of 2015 and break-even earnings in the first nine months of 2015.

New Head of Investor Relations of the Kuoni Group

As per 1 November 2015 Pierre Mas has been appointed new Head of Investor Relations of the Kuoni Group. He succeeds Laurence Bienz, who decided to leave Kuoni by the end of 2015. Pierre Mas has over 18 years’ experience in Investor Relations and Communications and has held roles in France and the US. He has acted as Vice-President Investor Relations & Corporate Communications at PartnerRe in Switzerland between 2008 and 2012. Since then he worked as independent Investor Relations & Communications Consultant in Paris, Singapore and Hong Kong. Pierre Mas holds a MSc (Econ.) in Western Politics from the London School of Economics and is a Certified Financial Analyst.

Conference on results for the first nine-months of 2015 and the further development of the Kuoni Group

The following conference is being held today for analysts and business and financial media:

09.00 CET, Hotel Savoy Baur en Ville, Poststrasse 12, Zurich

Kuoni Group’s Chairman Heinz Karrer will talk about the decisions taken by the Board of Directors and about the development of the Kuoni Group. New CEO Zubin Karkaria will introduce himself. Group CFO Thomas Peyer will present the results for the first nine months of the current year. The conference will be conducted in English and will be available on the internet as a live audio webcast.

All information and the investor presentations are available for download today from 6.45 a.m. CET at kuoni.com.

This information on the 2015 nine-month report is also available in the original German.

The German version is the authoritative version.

2016 schedule

Kuoni Group will report on its business performance as follows: Annual Report 2015: 15 March 2016

The General Meeting of Shareholders will be held in Zurich on 26 April 2016.

Kuoni Group accelerates implementation of its strategic direction

05.11.2015

Zubin Karkaria new CEO of the Kuoni Group
Global Travel Services (GTS) Division is being restructured
Board of Directors proposes removal of voting right restrictions

– Accelerated implementation of the corporate strategy as service provider to the travel industry and governments

– Zubin Karkaria, Head of VFS Global Division, appointed new CEO of the Kuoni Group

– Dr. Prisca Havranek-Kosicek appointed CFO and member of the Executive Board

– Partnership with Chinese HNA Group

– Restructuring of the GTS Division and significant cost reductions in support and corporate functions

– Confirmation of medium-term targets 2017

– Proposal to Annual General Meeting 2016 to remove voting right restrictions

– Kuoni Group’s Board of Directors is being renewed and reduced in size

Following the faster-than-planned completion of the sale of its traditional tour operating activities, Kuoni Group’s Board of Directors has given intensive consideration to the future of the Group, which is now focussed on services for the global travel industry and governments. After a critical review of the company’s strategy, organisation and cost structures, the Board of Directors has decided to accelerate implementation of the strategic direction. Zubin Karkaria, Head of VFS Global Division has been appointed new CEO of the Kuoni Group with immediate effect. Previous CEO, Peter Meier, will leave Kuoni. Within the loss-making GTS Division, the group travel business will be restructured extensively. Since Kuoni Group is now significantly smaller, support and corporate functions are being adjusted and costs reduced significantly. This will lead to one-off costs of CHF 20 million in 2015. The Board of Directors has also decided to renew its own membership in line with the demands of the new strategy.

The Board of Directors will ask the Annual General Meeting of 26 April 2016 to remove statutory voting right restrictions in order to strengthen shareholder rights and enhance dialogue with shareholders. With this package of measures, the Board of Directors is taking due account of changed market developments and also of investor expectations, while securing the company’s sustainable development.

The sale of Kuoni Group’s traditional tour operating businesses has achieved the planned refocusing of the company’s activities. The corporate strategy announced in January 2015 focuses on three businesses: distribution of hotel accommodation and destination services in the business-to-business sector (GTD Division), destination services in the areas of accommodation, transport, tours and event management (GTS Division) and globally leading visa services (VFS Global). This strategy has been reviewed by the Board of Directors and the Group Executive Board and its implementation is being accelerated. The Board of Directors is convinced that the company can achieve the medium-term targets announced in March 2015.

The three divisions benefit from leading positions in growth markets. The Global Travel Distribution (GTD) and VFS Global Divisions are posting above-average growth and reporting operating earnings as expected. The GTS Division is, however, confronted with major challenges, especially the changes in Japanese group travel business, and is being restructured extensively. Kuoni Group continues to monitor and review market opportunities in order to maximize shareholder value and enable profitable growth.

Zubin Karkaria is new CEO of the Kuoni Group

The Board of Directors has appointed Zubin Karkaria (47) as the new CEO of the Kuoni Group with immediate effect. He replaces the outgoing CEO Peter Meier and concurrently continues to run the VFS Global Division. Zubin Karkaria founded VFS Global in 2001 and built the company up very successfully to become the global leader in visa services for governments. VFS Global Division is the fastest growing, most innovative and most profitable division in the Kuoni Group.

Zubin Karkaria worked for Indian tour operator SOTC when it was acquired by Kuoni Group in 1996. In 2005 he was appointed CEO and Managing Director of Kuoni India and South Asia, where he was responsible for all units of Kuoni India (Tour Operating, Destination Management, Business Travel, and Kuoni Academy) while simultaneously managing VFS Global’s business (as CEO from 2010). In March 2013, he was appointed to the Kuoni Group’s Executive Board.

Peter Meier joined Kuoni at the end of 2010 as CFO. He acted as interim CEO from mid-2013, assuming the post definitively in March 2014. He has played an essential role in Kuoni’s comprehensive transformation into a focussed, global service provider for the travel industry and governments, and was instrumental in shaping the new strategy. Following this major change process, Peter Meier and the Board of Directors have agreed it is in the company’s best interests to put its management in new hands. The Board of Directors would like to thank Peter Meier sincerely for his very valuable contribution to Kuoni Group’s reorientation and for his exceptional commitment to the company.

New Kuoni Group Chief Financial Officer (CFO) appointed

The Board of Directors has appointed Dr. Prisca Havranek-Kosicek (40) as the Kuoni Group’s new CFO. Prisca Havranek-Kosicek, an Austrian citizen, has many years’ experience of senior operational and consultancy roles in finance, controlling, strategy development and restructurings. Since the end of 2014 she has been Group Treasurer of Royal DSM, a Dutch company globally active in health, nutrition and materials. Prisca Havranek-Kosicek has an MBA from the University of Economics of Vienna and a doctorate in business administration.

She takes over as CFO of the Kuoni Group in the course of the first quarter of 2016 and will report to Zubin Karkaria, Kuoni Group’s CEO. Prisca Havranek-Kosicek succeeds Thomas Peyer who will leave Kuoni Group in 2016, as announced, after a hand-over period. This appointment completes the renewal of Kuoni Group’s Executive Board.

Restructuring of the GTS Division

The aim of restructuring the GTS Division is to rapidly adjust to changed market conditions through more flexible and cost-efficient structures. Management structures will be adapted, complexity reduced, operational back-office activities outsourced and services that do not add value will be discontinued. Sales activities will be streamlined, simplified and focused on more profitable customer segments. The existing IT architecture has been reviewed and will be adapted to cater for this. The planned new, end-to-end IT solution for Group Travel covering all of the current services is no longer deemed fit for purpose and as a result has been terminated.

The GTS restructuring will primarily take place within Group Travel. This requires the relocation of various activities and will result in a global reduction of around 350 full-time posts, which will be achieved through natural attrition but also through redundancies. This restructuring programme is expected to reduce the cost base sustainably by more than CHF 30 million. Anticipated, non-recurring restructuring costs amount to CHF 15 million, which is likely to impact results in 2015, but will be mainly cash-positive in 2016. The realignment of the existing IT architecture and termination of the planned IT solution will already have an additional negative impact of CHF 19 million on the third quarter 2015 results (see information on the results for the first nine months of 2015).

Organisational adaptation and significant cost reductions in support and corporate functions

The Kuoni Group’s support and corporate functions, which will obviously be smaller following the sale of the tour operating activities, especially in the areas of finance and IT infrastructure, will be simplified and increasingly outsourced, thus lowering the Group’s corporate costs by about a third. The planning activities required for this will be completed by the end of 2015, with implementation to follow in 2016. Related non-recurring restructuring costs are expected to have an adverse impact of CHF 5 million on the 2015 result.

Partnership with the Chinese HNA Group

Kuoni Group has entered a partnership with HNA Group of China. HNA Group is one of the leading private companies of Chinese origin, and is globally active in a number of businesses including tourism and aviation. The goal of the partnership is to jointly develop the outbound travel business in China and to partner in related strategic matters. Both companies are looking at various areas of potential cooperation in order to leverage Kuoni Group’s global destination expertise and network of business partners in the tourism industry, and HNA Group’s tourism assets and strong distribution network in the Chinese market.

HNA Group, a Fortune Global 500 company, was founded in China in 1993. It has five core businesses in the areas of aviation, tourism, logistics, industry and financial services, and encompasses 12 listed companies. In 2014, HNA Group had revenues in excess of USD 25 billion, assets of USD 72 billion and nearly 120,000 employees worldwide, www.hnagroup.com.

Downsizing and renewal of the Board of Directors

At the Annual General Meeting on 26 April 2016, Kuoni Group’s Board of Directors will be proposing the downsizing of the body from seven to six members and a renewal of the Board’s membership. With its new composition, the competences of the Board of Directors will focus on Kuoni Group’s changed portfolio. A reduction in the Board’s compensation is also foreseen. The Board of Directors will provide information in good time before the meeting about the nomination of new Board members with appropriate expertise and the departure of existing members. Chairman of the Board of Directors Heinz Karrer is working closely with Adriaan Nühn, Chairman of the Nominations Committee, to lead the renewal process, which will be completed at the Annual General Meeting on 26 April 2016.

Unchanged Dividend Policy

The Board of Directors confirms its current dividend policy with a distribution of 40-45% of net result attributable to shareholders. The Board of Directors intends to propose to the next Annual General Meeting that it distribute a dividend for the 2015 financial year, which will exclude the one-time effects of selling the tour operating activities, the impairment of other intangible assets and the proceeds of the potential sale of the Neue Hard property in Zurich, which could occur in 2015 or 2016.

Comments by Kuoni Group’s Chairman Heinz Karrer:

“The Kuoni Group has been transformed from a broadly based travel company pursuing a wide range of very different activities into a focussed global service provider for the professional travel industry and governments. Such an in-depth new strategic direction presents a number of challenges and places heavy demands on management especially in fast-changing markets. After a critical review of the strategic direction, the Board of Directors has decided to accelerate its implementation. The changes in the Executive Board, with Zubin Karkaria as new CEO and Prisca Havranek-Kosicek as new CFO of the Kuoni Group, are part of this process. In addition, the strategic direction is being reinforced by the partnership with the Chinese HNA Group. The renewal of the competences in the Board of Directors and the planned removal of the restriction on voting rights are further important steps as we move the newly aligned Kuoni Group forward on a sustainable basis and with due regard to ever-faster market changes.”

Conference on results for the first nine-months of 2015 and the further development of the Kuoni Group

The following conference is being held today for analysts and business and financial media:

09.00 CET, Hotel Savoy Baur en Ville, Poststrasse 12, Zurich

Kuoni Group’s Chairman Heinz Karrer will talk about the decisions taken by the Board of Directors and about the development of the Kuoni Group. New CEO Zubin Karkaria will introduce himself. Group CFO Thomas Peyer will present the results for the first nine months of the current year. The conference will be conducted in English and will be available on the internet as a live audio webcast.

All information and the investor presentations are available for download today from 6.45 a.m. CET at kuoni.com.

Kuoni Group signed CHF 200 million credit facility running to 2020 

22.09.2015

The new revolving credit facility of CHF 200 million replaced the existing agreement on 21 September 2015 and runs until June 2020. Kuoni Group initiated early refinancing of the existing revolving credit facility of CHF 209 million in the first half of 2015 to benefit from attractive conditions on the capital markets. The lenders are a syndicate of seven banks. The previous credit facility was agreed in 2011 and had a term running till June 2016.

The new credit facility includes a financial covenant relating to the degree of indebtedness. The maximum degree of indebtedness must not exceed 3.0 times, measured as the ratio between net debt and EBITDA. A minimum level of Group equity is no longer required. The interest to be paid is calculated on Libor plus a margin of between 0.85% and 2.15%.

Credit Suisse, in the role of “Facility Agent”, was responsible for coordinating the financing. The transaction was carried out together with the Luxembourg branch of Commerzbank Aktiengesellschaft and the London office of Citibank N.A. as “Mandated Lead Arrangers”. UBS Schweiz, Zürcher Kantonalbank, Basler Kantonalbank and Raiffeisen Schweiz Genossenschaft also took part in the transaction as lenders.

Completion of sale of European tour operating activities to REWE Group 

14.09.2015

The sale of European tour operating activities to REWE Group was completed on 11 September 2015 after the responsible European competition authorities gave their unconditional approval to the transaction earlier. REWE Group, and its tourism division DER Touristik, is taking over Kuoni Group’s tour operating activities in Switzerland, UK, Scandinavia/Finland and Benelux. It is taking on the employees and locations, and continuing the business activities.

Clarification note to estimated net debt position 

31.08.2015

It is the understanding of the Kuoni Group that the estimated net debt position at year-end 2015 is share price relevant and that the financial market made various different assessments based on the Half Year Results 2015. The purpose of this information is to clarify Kuoni Group’s assessment and to specify statements made earlier.

The net liquid fund position of the Kuoni Group amounted to CHF 132 million as per 30 June 2015 and after deducting the customer advance payments the net debt position amounted to CHF -468 million. The estimated net debt position for the year end 2015 involves various assumptions, in particular in relation to free cash flow, currency fluctuations as well as the execution and the closing of the sale of the tour operating activities in Europe and Asia. These transaction closings are expected in 2015 and these businesses will be deconsolidated accordingly. Further a normal development of free cash flow, comparable exchange rates and no further cash relevant real estate disposal, the estimated net debt position for year end 2015 improves to CHF -200 to CHF -250 million.

Kuoni Group posts organic growth above market – All tour operating activities sold faster than planned

21.08.2015

First half-year 2015

– CHF 1,532 million turnover from continuing operations, positive organic growth of +6.8%

– Strong Swiss franc had -7.4% negative impact on turnover

– Significant organic turnover growth for core businesses at GTD (+10.9%) and VFS Global (+28.8%) Divisions

– Operating earnings before amortisation (EBITA): CHF 16.7 million; EBIT: CHF 3.6 million

– Net result from continuing operations: CHF 5.9 million

– Net result from discontinued operations: CHF -178.0 million,
includes one-time effects from sale of European tour operating activities

– All tour operating activities sold successfully and faster than planned

Outlook for 2015

– Full-year operating earnings (EBIT) from continuing operations expected to be in the range of CHF 40 to CHF 50 million

Key figures

CHF million 1.1.-30.6.2015 1.1.-30.6.2014 1 Change in %
Turnover 1,531.9 1,541.9 – 0.6
Gross profit 278.1 288.2 – 3.5
Gross profit margin (%) 18.2 18.7
Operating earnings before amortisation (EBITA) 16.7 45.4 2 – 63.2
EBITA margin (%) 1.1 2.9
Operating earnings (EBIT) 3.6 30.7 2 – 88.3
EBIT margin (%) 0.2 2.0
Net result from continuing operations 5.9 28.4 – 79.2
Net result from discontinued operations – 178.0 – 42.4 – 319.8
Net Result – 172.1 – 14  
Free cash flow from continuing operations 31.9 50.0 – 36.2

1 Restatement of prior-year figures due to the decision to sell all outbound tour operating activities

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014

Peter Meier, CEO of Kuoni Group, made the following comments:

“Kuoni Group’s organic growth above market in first half of 2015 vindicates the new strategic direction initiated at the beginning of the year and the focus on global B2B business areas. However, the strong Swiss franc had a significant negative impact on turnover due to the conversion into our presentation currency. The two divisions Global Travel Distribution (GTD) and VFS Global recorded strong growth. In the first six months of the year, VFS Global processed over 10 million visa applications for the first time. With the successful sale of all tour operating activities in June and August 2015, we achieved a key objective of the new strategic direction faster than planned.”

Current trading 2015

As at 9 August 2015, percentage changes in booking levels and turnover for the year to date compared with the equivalent prior-year period were as follows in Swiss franc (CHF) and local currency (LC) terms:

Continuing operations CHF LW
Global Travel Distribution (GTD)  +3% +12%
Global Travel Services (GTS) 1 –10% 0%
VFS Global (Number of applications processed)   +11%

1 Excl. Destination Management India unit sold in August 2015 

Outlook for 2015

For 2015 as a whole the Kuoni Group expects operating earnings (EBIT) from continuing operations in the range of CHF 40 to CHF 50 million. This includes an expected negative exchange rate impact on the presentation currency of around CHF 7.5 million compared to prior-year due to the strong appreciation of the Swiss franc in 2015.

The Indian Destination Management business that was sold at the beginning of August 2015 will in future be reported under “discontinued operations”. In the outlook for financial year 2015 the unit is already treated as a “discontinued operation”.

In addition, at the time of deconsolidation of the sold tour operating activities and Destination Management India, the over the years accumulated currency translation losses (CTA) will charge the net result. This one-off special accounting effect does not impact the equity or cash position. As at end-June 2015, the accumulated currency translation losses amount to about CHF 215 million.

Conference calls on Kuoni Group’s 2015 interim figures

The following conference calls will be held today for analysts and journalists:analysts 9.30 a.m. CEST (in English); media 11.00 a.m. CEST (in German) Peter Meier, CEO, and Thomas Peyer, CFO of Kuoni Group, will be commenting on the 2015 half-year results. All information and the investor presentations are available for download today from 7.00 a.m. CEST from kuoni.com.

Kuoni Group figures

Kuoni Group generated turnover of CHF 1,532 million in the first half of 2015 (20141: CHF 1,542 million). Organic growth came to +6.8%. Exchange rate effects had a significant -7.4% significant negative impact on turnover in Swiss francs, the Group’s presentation currency. The GTD and VFS Global Divisions recorded positive organic growth of 10.9% and 28.8% respectively. The GTS Division achieved strong growth in group travel business in China and Taiwan, while demand in the important Japanese market declined.

Gross profit came to CHF 278 million (20141: CHF 288 million). Organic growth in gross profit came to +2.5%. The gross profit margin came to 18.2% (20141: 18.7%). The conversion into Swiss francs had a negative effect. VFS Global significantly increased its gross profit thanks to strong growth. By contrast, lower turnover from the GTS Division in the Japanese market had a negative impact on gross profit. Targeted marketing activities aimed at accelerating growth in the key markets meant that the GTD Division had to accept lower margins.

Earnings before amortisation (EBITA) came to CHF 16.7 million (20141,2: CHF 45.4 million). Operating earnings (EBIT) stood at CHF 3.6 million (20141,2: CHF 30.7 million). The lower gross profit in GTD and GTS Divisions as well as the higher cost of the growth strategy in the GTD and VFS Global Divisions had a negative effect on operating earnings development. It should also be noted that the prior-year results were boosted by the CHF 10.1 million proceeds of a property sale in Zurich.

Net profit from continuing operations came to CHF 5.9 million (20141: CHF 28.4 million). The net result from discontinued operations stood at CHF -178.0 million (20141: CHF -42.4 million). This includes non-recurring effects, as communicated in June when the European tour operating activities were sold. These effects include the net proceeds, the cost of the sales process and impairments on goodwill. Most of this has no effect on liquidity.

As communicated in January 2015, the discontinued operations include the outbound tour operators in Switzerland, the UK, Scandinavia/Finland, Benelux, India and Hong Kong. Destination Management India, the sale of which was announced on 7 August 2015, is still included in the half-year results under “continuing operations” but will in future be reported under “discontinued operations”.

Cash flow from operating activities from continuing operations came to CHF 40.9 million (20141: CHF 63.5 million). Free cash flow from continuing operations came to CHF 31.9 million (20141: CHF 50.0 million). The year-on-year decline is due to lower operating earnings (EBIT) and changes in net working capital.

Kuoni Group’s equity at 30 June 2015 came to CHF 440 million (31.12.2014: CHF 779 million). The equity ratio stood at 18.5% (31.12.2014: 32.2%). Equity declined significantly owing to the negative net result, the distribution against capital reserves and material currency translation losses (CHF -114 million) as a result of the Swiss National Bank’s decision to abandon the minimum exchange rate against the euro.

As at 30 June 2015, Kuoni Group’s continuing operations (incl. Destination Management India) had 8,564 employees (FTE) (2014: 8,054 FTE).

Change in Kuoni Group’s Executive Board

Group CFO Thomas Peyer will leave Kuoni Group. Thomas Peyer has been with Kuoni since 1999 and has held various senior roles in Finance prior to his appointment as Group CFO in March 2014. He was instrumental in the divestiture process of the Outbound units, which will be concluded in the course of 2015. A search for his successor has been initiated and a successor will be announced at a later stage. Thomas Peyer will remain in the role as Group CFO until first-half of 2016. The Board of Directors wants to thank Thomas Peyer for his valuable contribution to the development of the company over the years.

Kuoni Group figures

Income Statement

  3rd quarter    
CHF million 1.1.-30.6.2015 1.1.-30.6.2014 1 Change in % 1.1.-31.12.2014 1
Continuing operations        
Turnover 1,531.9 1,541.9 –0.6 3,436.0
Direct costs -1,253.8 -1,253.7 0.0 -2,810.3
Gross profit 278.1 288.2 –3.5 625.7
Personnel expense –167.6 –160.8 –4.2 –329.2
Marketing and advertising expense –4.7 –4.8 2.1 –8.3
Other operating expense –76.5 –60.5 –26.4 –144.4
Share in result from joint ventures 2.5 –0.8   –2.0
Depreciation -15.1 –15.9 5.0 -32.5
Earnings before interest, taxes and amortisation (EBITA) 16.7 45.4 2 –63.2 109.3 2
Amortisation –13.1 –14.7 10.9 –29.4
Earnings before interest and taxes (EBIT) 3.6 30.7 2 -88.3 79.9 2
Financial income 3.3 2.1 57.1 5.2
Financial expense –1.2 –3.0 60.0 –3.9
Result before taxes 5.7 29.8 –80.9 81.2
Income tax income / (expense) 0.2 –1.4 n.a. –18.8
Net result from continuing operations 5.9 28.4 –79.2 62.4
         
Net result from discontinued operations, net of income taxes –178.0 –42.4 –319.8 5.0
         
Net Result –172.1 –14.0   67.4
Of which:        
Attributable to non-controlling interests 0.3 0.3   1.0
Attributable to shareholders of Kuoni Travel Holding Ltd –172.4 –14.3   66.4
         
From continuing and discontinued operations:        
Basic / diluted earnings per registered share A –8.93 –0.74   3.44
Basic / diluted earnings per registered share B –44.63 –3.69   17.20
         
From continuing operations:        
Basic / diluted earnings per registered share A 0.30 1.45   3.17
Basic / diluted earnings per registered share B 1.48 7.27   15.87

1 Restatement of prior-year figures due to the decision to sell all outbound tour operating activities

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014 

Breakdown of turnover

CHF million 1.1.-30.6.2015 1.1.-30.6.2014 1 Change in % Organic Growth in % 1.1.-31.12.2014 1
Global Travel Distribution (GTD) 872.9 848.1 2.9 10.9 1,933.6
Global Travel Services (GTS) 502.3 570.2 –11.9 –4.4 1,234.2
VFS Global 158.1 127.1 24.4 28.8 270.8
Less turnover eliminations –1.4 –3.5     –2.6
Kuoni Group 1,531.9 1 41.9 –0.6 6.8 3,436.0

1 Restatement of prior-year figures due to the decision to sell all outbound tour operating activities

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014 

Breakdown of operating earnings before amortisation (EBITA)

CHF million 1.1.-30.6.2015 1.1.-30.6.2014 1 1.1.-30.12.2014 1
Global Travel Distribution (GTD) 12.5 25.9 63.2
Global Travel Services (GTS) -17.6 –6.5 4.8
VFS Global 32.6 26.5 52.5
Corporate –10.8 –0.5 2 –11.2 2
Kuoni Group 16.7 45.4 2 109.3

1 Restatement of prior-year figures due to the decision to sell all outbound tour operating activities

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014 

Breakdown of operating earnings (EBIT)

CHF million 1.1.-30.6.2015 1.1.-30.6.2014 1 1.1.-30.12.2014 1
Global Travel Distribution (GTD) 3.2 15.1 42.0
Global Travel Services (GTS) –21.4 –10.4 –3.4
VFS Global 32.6 26.5 52.5
Corporate –10.8 –0.5 2 –11.2 2
Kuoni Group 3.6 30.7 2 79.9 2

1 Restatement of prior-year figures due to the decision to sell all outbound tour operating activities

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014 

Global Travel Distribution (GTD)

Turnover came to CHF 873 million (20141: CHF 848 million). Organic growth was +10.9%. Earnings before amortisation (EBITA) came to CHF 12.5 million (20141: CHF 25.9 million). Operating earnings (EBIT) stood at CHF 3.2 million (20141: CHF 15.1 million).

Approximately 6.6 million room nights were booked in the first half of 2015, an increase of 7.8% compared to the same period last year. All source markets recorded more bookings than in 2014. Strong growth was achieved in the Asia/Pacific market, especially in China, India, Singapore and Indonesia. Lower margins were accepted in order to accelerate growth in the key markets through targeted marketing activities. Higher personnel costs resulting from the growth strategy and investments in new IT applications also had an impact on operating earnings.

Global Travel Services (GTS)

Turnover of CHF 502 million was generated in the first six months of 2015 (20141: CHF 570 million). Organic growth came to -4.4%. Earnings before amortisation (EBITA) came to CHF -17.6 million (20141: CHF -6.5 million). Operating earnings (EBIT) stood at CHF -21.4 million (20141: CHF -10.4 million).

In the group travel business in Asia there was above-average growth in China and Taiwan while demand declined in Japan. Positive growth outside Japan resulted in overall organic growth of +4.1% in the group travel business. However, the strong Swiss franc had a very negative effect on the conversion into the presentation currency, leading to a fall in turnover. Lower gross profit in the Japanese market also had a negative effect on the operating result. Approximately 1.4 million room nights were booked in the first half of 2015, an increase of 4.1%.

Geopolitical events had a negative effect on demand at the destination management specialists, particularly in the Middle East and Africa, which led to a decline in turnover. Demand was up in the USA and Asia/Pacific by contrast. Cost savings and a focus on destination services with higher margins and more profitable accounts led to an improvement in operating earnings.

VFS Global

The visa services provider saw turnover rise significantly to CHF 158 million (2014: CHF 127 million). Organic growth was +28.8%. Operating earnings before amortisation (EBITA) and operating earnings (EBIT) came to CHF 32.6 million (2014: CHF 26.5 million).

For the first time, more than 10 million visa applications were processed within the first six months of the year, an increase of 11.2%. This growth was achieved primarily in the source markets of South America, India, the Middle East and Africa. A temporary contract with the South African authorities for administrative processing of citizen services for foreigners in the second half of 2014 and first half of 2015 contributed to this growth. The difficult economic situation in Russia led to a significant decrease in applications in this source market.

A total of 230 new application centres were opened in the first half of 2015. The increase is mainly due to the opening of application centres from new global contracts to the governments of Norway, Croatia and Lithuania. On 30 June 2015, VFS Global was operating 1,709 Visa Application Centres for 45 governments in 121 countries. The joint venture providing visa services for the Kingdom of Saudi Arabia made its first positive contribution to earnings in the first half of 2015.

This information on the 2015 half-year report is also available in the original German.

The German original shall prevail.

Kuoni Group will report on its business performance as follows:

Nine-month business update: 5 November 2015
Annual Report 2015: 15 March 2016

The General Meeting of Shareholders will be held in Zurich on 26 April 2016.

Kuoni Group sells Indian travel activities and tour operator in Hong Kong to Canadian group Fairfax

07.08.2015

– Fairfax Financial Holdings Ltd acquires Kuoni Group’s outbound and inbound business activities in India as well as the tour operator Kuoni Hong Kong

– Employees and offices are being taken over, and business activities are being continued

– Kuoni Group completes successful exit from entire tour operating business more quickly than planned

Kuoni Group has signed an agreement with Fairfax Financial Holdings Ltd through its travel provider Thomas Cook India to sell Kuoni’s Indian travel activities and the tour operator Kuoni Hong Kong. The Indian travel activities encompass outbound tour operating, business travel, travel agencies, and inbound business (Destination Management India). The purchase price is CHF 79 million. Subject to approval from the competent authorities, the transaction is expected to complete in the course of 2015.

Fairfax/Thomas Cook India are taking on all of the approximately 1’800 employees (FTE) at the existing locations in India and Hong Kong and will continue to run the business activities. In 2014 the sold businesses generated a turnover of CHF 284 million and operating earnings before amortisation (EBITA) of CHF 4.5 million. Thomas Cook India has over 232 locations in 94 cities in India, Mauritius and Sri Lanka and is a leading provider of foreign exchange services, business and leisure travel. Thomas Cook India is a listed company at the National Stock Exchange of India and is majority-owned by Canadian group Fairfax Financial Holdings Ltd, which is listed on Toronto Stock Exchange.

The Kuoni brand is licensed to the acquirer for one year in India and for five years in Hong Kong. All other brands such as SOTC, Sita and Distant Frontiers are transferred with the business.

“With the sale of the tour operating activities in India and Hong Kong, we have completed the sale of the outbound business as announced in January. I’m very pleased that we found forward-looking solutions for all the units. The inclusion of the Indian Destination Management Specialists in the deal provided Kuoni Group an opportunity to conclude a timely transaction at attractive terms. We expect the closing of all transactions in the course of 2015, allowing Kuoni to focus on the further development of its core business”, said Peter Meier, CEO of Kuoni Group.

At completion of the transaction, the sale of these Asian tour operating activities and Destination Management India will have a slightly positive effect on the net result from discontinued operations. When the transaction is completed, the over the years accumulated currency translation losses (CTA) will also be recorded under “results from discontinued operations”. This one-off special accounting effect to the deconsolidation does not impact the equity or cash position. As at end-June 2015, the accumulated currency translation losses come to CHF 49 million.

Kuoni Group sells all European tour operating businesses to REWE Group – New strategic direction proceeding more quickly than planned

22.06.2015

– DER Touristik, the travel division of REWE Group, is acquiring all of the tour operators, specialists and travel agencies run by Kuoni Group’s units in Switzerland, the United Kingdom, Scandinavia/Finland and Benelux

– Employees and offices are being taken over, and business activities are being continued

– The Kuoni, Apollo and specialist brands will remain in the market

– Kuoni Group achieves a successful withdrawal from European tour operating activities already in the first half of 2015

“The successful sale of our European tour operating activities marks a significant milestone in the development of the Kuoni Group. European tour operating has been closely associated with the Kuoni name for more than 100 years. Our tour operating businesses and all their brands are now being taken over by the REWE Group and its experienced DER Touristik travel division, which will integrate them into its growth strategy. I am pleased that with this sale we have found an ideal, forward-looking, long-term solution for our customers and employees,” said Peter Meier, CEO of the Kuoni Group.

Heinz Karrer, Chairman of the Board of Directors of the Kuoni Group said: “With the sale of the entire European tour operating business we can complete the new strategic direction of the Kuoni Group more quickly than planned.”

Kuoni Group has signed an agreement with DER Touristik for it to acquire all the tour operators, specialists, travel agencies and online sales in the Switzerland, UK, Scandinavia/Finland and Benelux markets, as well as the airline Novair and the Playitas family and sports resort on Fuerteventura. The two parties have agreed not to disclose the purchase price or contract details. The acquisition is subject to the approval by the relevant competition authorities in the EU and Switzerland. The transaction is expected to be completed in the third quarter of 2015.

REWE Group is acquiring all of the approximately 2 350 (FTE) employees at the existing locations and will continue to run the business activities, including all the travel agencies, as part of its DER Touristik travel division. In 2014 the European tour operating activities that have been acquired generated turnover of around CHF 2.0 billion. With this acquisition DER Touristik is positioning itself as a leading pan-European travel company. DER Touristik sees the acquisition as an ideal addition to its sales operation, giving it new competitive advantages in the beach holiday business as well as in international purchasing of flight, hotel and other customer services. DER Tourstik is part of the REWE Group, one of the leading retail and travel groups in Germany and Europe.

The tour operating activities will continue to trade under their existing brands. REWE Group is acquiring the right to use the Kuoni brand in Switzerland and the UK, while Kuoni Group remains the owner of the Kuoni brand. REWE Group is taking full ownership of the Apollo brand in Scandinavia/Finland and of all the specialist brands.

Kuoni intends to complete its search for a buyer for the remaining tour operating activities in India and Hong Kong/China during the course of 2015.

The sale of the European tour operating activities is likely to impact the half-year results of discontinued operations in the range of CHF -180 million. This one-time effect includes the net result, the cost of the sales process and an impairment charge on goodwill. A large part of the overall charge has no effect on liquidity. Once the transaction is completed (Q3 2015) the accumulated currency translation losses (CTA) will also be recorded under “results of discontinued operations”. This is a one-off accounting effect related to the deconsolidation and does not impact the equity or cash position. Accumulated currency translation losses amounted to CHF 164 million as of the end of May 2015. The net debt position including advance payments by customers will improve once the transaction is completed. Cash and cash equivalents will reduce with the reduction in advance payments by customers from tour operating activities.

Kuoni Group announced in January 2015 that it would be concentrating on its core business as a service provider to the global travel industry and governments. This new strategic direction is turning Kuoni into a focused, clearly positioned global service provider with attractive growth prospects. It has no prepurchased flight capacities or hotel rooms, which significantly improves the risk profile of the Kuoni Group.

The company consists of three divisions: Global Travel Distribution (GTD), Global Travel Services (GTS) and VFS Global. These core business units have established leading positions in markets characterised by high growth rates. Its positioning as a unique service provider with a strong presence in Asia gives Kuoni the opportunity to increase its growth and profitability through economies of scale, and to build up business further by exploiting its cross-selling potential. Kuoni will focus in particular on markets with attractive, long-term growth potential in Asia, the Middle East and Africa. At the start of 2015 the company simultaneously launched strategic key initiatives to accelerate growth and boost profitability.

The Board of Directors of Kuoni Group intends to maintain to its existing dividend policy and suggests a distribution to shareholders amounting to 40-45% of profit from continued activities attributable to shareholders.

Note to journalists: Press conference
Kuoni Group is holding a press conference regarding the successful sale of its European tour operating activities today, 22 June 2015, at 11.00 (CEST) at the Hotel Park Hyatt, Beethovenstrasse 21, Zurich. Kuoni Group’s CEO Peter Meier and Sören Hartmann, CEO of DER Touristik, will explain the change of ownership and the prospects for customers. The press conference will be conducted in German.

Kuoni Group with sustained growth at Global Travel Distribution and VFS Global – market environment remains challenging 

11.06.2015

– Business environment remains challenging and highly competitive

– Positive growth at Global Travel Distribution Division (GTD), especially in Asia/Pacific region

– Solid growth in group travel from China (Global Travel Services Division, GTS), but continued decline in demand from Japan

– Strong demand at visa services provider VFS Global, especially in Asia/Pacific and Africa

– Partly lower bookings in Outbound Unit activities which are up for sale

– Appreciation of Swiss franc has significant negative impact on operating and net result expressed in Swiss franc terms

As at 31 May 2015, percentage changes in booking levels and turnover for the year to date compared with the equivalent prior-year period were as follows in Swiss franc (CHF) and local currency (LC) terms:

  CHF LC
Global Travel Distribution (GTD)  +4% +12%
Global Travel Services (GTS) -14% -7%
VFS Global Number of applications processed   +11%
Discontinued operations: Outbound Units                  –13% –8%

In the first five months of the current year, Kuoni Group reported continuing growth in the global business activities of its Global Travel Distribution (GTD) and VFS Global Divisions.

Bookings made on the GTD Division’s booking platforms for room nights in hotels and destination services were up +12% in local currency terms. There was particularly good growth in the Asia/Pacific region. The gross profit margin was lower than in the previous year owing to the targeted growth strategy.

The GTS Division saw bookings for group travel from the Chinese market increase strongly. Demand from Japan continued to fall owing to the general economic environment there, and demand at the Destination Management Specialists was lower than in the previous year. The economic situation in Russia meant there was a sharp drop in the number of Russian customers in destinations in the Middle East and India. By contrast, bookings for destinations in the USA and in Asia/Pacific went up.

Up to the end of May 2015, visa services provider VFS Global processed 11% more visa applications than in the same period in the previous year. The rise in applications was particularly apparent in Asia/Pacific and Africa. The number of applications was slowed by the fall demand in Russia and the Ukraine, which was a result of the tense geopolitical situation.

Booking numbers for the tour operating activities that are up for sale (Outbound Units) were down -8% in local currency terms. In a persistently difficult market environment in Scandinavia/Finland, the booking trend improved slightly, but sales fell mainly because of a significant decrease in flight capacities. While the India, Hong Kong/China and Benelux markets performed well, the Swiss market suffered from the removal of the floor on the euro/franc exchange rate. Discounts and reduced flight capacities led to lower bookings compared with the same period in the previous year.

The tour operating activities that are up for sale are shown in the consolidated accounts as “discontinued operations”. Kuoni Group expects an overall notable negative contribution from discontinued operations, mainly because of the difficult situation in the Swiss market and the previously announced costs of approximately CHF 25 million for the sales process. Kuoni Group intends to find new owners for its Outbound Units in the course of 2015.

Today, 11 June 2015, Kuoni Group conducts a Capital Markets Day. The corresponding presentation is available for download as of 9.30am (CEST) on here.

Kuoni shareholders approve unchanged dividend and elect Selina Neri as new Board member

20.04.2015

At today’s Annual General Meeting of Kuoni Travel Holding Ltd. shareholders approved an unchanged distribution of CHF 1.50 per registered share A and CHF 7.50 per registered share B. Selina Neri was elected as a new member of the Board. All Board members standing for re-election were confirmed for a further one-year term of office. Heinz Karrer was also re-elected as Chairman of the Board of Directors for another year. Shareholders approved all the other items on the agenda.

The approved payment to shareholders corresponds to a distribution ratio of 43.7%. The payment takes the form of a withholding tax-free distribution against reserves from capital contributions. The ex-dividend date is 22 April 2015. The value date for the distribution is
24 April 2015.

Shareholders elected Selina Neri, an Italian national, as a new Board member. She replaces Raymond Webster, who did not stand for re-election. Heinz Karrer was confirmed as Chairman of the Board of Directors for another term of one year. All the other Members of the Board of Directors were also re-elected for a further one-year term of office.

All other items on the agenda were approved by shareholders. The individual results have been available online since 16:30 CEST today.

Kuoni Group’s 2014 net result on previous year’s level – Dividend unchanged – Implementation of new strategic direction progressing as planned

17.03.2015

Highlights of the 2014 financial year

– Stable turnover of CHF 5 508 million compared to prior year in organic terms, despite, a challenging business environment (2013: CHF 5 669 million)

– Solid operating earnings:
EBITA CHF 122.2 million (20131: CHF 150.1 million) 
EBIT CHF 85.7 million (20131: CHF 112.9 million)

– Net result of CHF 67.4 million similar to prior year’s level (2013: CHF 69.2 million)

– FIT (new: GTD) reported strong organic turnover growth of 8.8% and exceeded 13 million worldwide hotel room nights booked for the first time

– Visa services provider VFS Global posted organic turnover growth of 13.9% and a 30.6% increase in EBIT

– Unchanged dividend of CHF 7.50 per share proposed (distribution against reserves from capital contributions)

Key figures

CHF million 2014 2013 adjusted 1 2013 Change in % 2
Gross profit 1,025.1 1,105.5 1,105.5 –7.3
Gross profit margin (%) 18.6 19.5 19.5  
Operating earnings before amortisation (EBITA) 122.2 150.1 191.4 –18.6
EBITA margin (%) 2.2 2.6 3.4  
Operating earnings (EBIT) 85.7 112.9 154.2 –24.1
EBIT margin (%) 1.6 2.0 2.7  
Net result 67.4 36.7 69.2 83.7
Free cash flow 33.2 124.6 124.6 –73.4

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

2 2013 adjusted vs 2014

Peter Meier, CEO of Kuoni Group, made the following comments:

“The implementation of the new strategic direction announced in 2015 is going according to plan. Kuoni Group is now concentrating on its core business as a service provider to the global travel industry and governments, as well as on strategic initiatives designed to accelerate growth and increase profitability. Kuoni Group has therefore decided to sell its tour operating activities. Despite the challenging business environment, turnover in financial year 2014 was stable compared to prior year in organic terms. Two of our core activities – Global Travel Distribution (GTD), formerly FIT, and VFS Global – posted positive organic growth, especially in Asian source markets. Net result was similar to 2013.”

Current trading 2015

With the introduction of the new group structure (see communication of 14 January 2015), the trading update is now reported through three divisions: Global Travel Distribution (GTD), Global Travel Services (GTS) and VFS Global.
As at 8 March 2015, percentage changes in booking levels and turnover for the year to date compared with the equivalent prior-year period were as follows in Swiss franc (CHF) and local currency (LC) terms:

Continuing operations CHF LW
Global Travel Distribution (GTD), (formerly FIT) +11% +20%
Global Travel Services (GTS), (formerly Group Travel, Destination Management Specialists)  –14% –9%
VFS Global, Number of applications processed   +10%
Discontinued operations: Outbound Units      –14% –9%

Medium-term outlook to 2017

Owing to Kuoni’s international activities and foreign subsidiaries, the removal of the minimum Swiss franc exchange rate against the euro on 15 January 2015 is likely to have a significant negative impact on the Group’s consolidated accounts, which are presented in Swiss francs. For the years from 2015 to 2017, Kuoni Group aims to achieve annual growth (CAGR) significantly higher than the 3.8% industry growth rate forecast by the UN World Tourism Organisation (UNWTO). The basis for measurement is the new structure with the core activities of Divisions GTD, GTS and VFS Global in 2014, but exchange rates as at end-January 2015. The following targets have been set for 2017:

Kuoni Group (new structure) 2014 reported 2014 currency adjusted basis 1 2017
Turnover CHF million 3,436 2,970 ≥5% p.a.
EBIT margin 2 2.3% 1.9% 3 ≥3.0%
Free cash flow as % of turnover n/a 4 n/a 4 ≥2.5%

1 Exchange rates at end-January 2015

2 orresponds to EBITA margin: 3.2% (2014 reported), 2.8% (2014 currency adjusted basis), ≥3.6% 2017

3 adjusted by sale of no longer needed property “Geroldstrasse” with the amount of CHF 10.1 million

4 Free cash flow not available in new structure

Kuoni Group figures

Reporting in accordance with old 2014 segment structure

Kuoni Group generated turnover of CHF 5 508 million in the 2014 financial year (2013: CHF 5 669 million). Organic growth came to -0.1%. The segments FIT and VFS Global recorded positive organic growth of 8.8% and 13.9% respectively. The net effect of acquisitions/divestments came to -1.0% owing to the exit from loss-making European tour operating activities in 2013. Currency influences on the presentation currency came to -1.7%.

Gross profit came to CHF 1 025 million (2013: CHF 1 106 million). The gross profit margin came to 18.6% (2013: 19.5%). The reduction in gross profit can be attributed primarily to the performance of Outbound Nordic, Group Travel and Destination Management Specialists. On the other hand VFS Global achieved a significant increase in gross profit.

Operating earnings before amortisation (EBITA) came to CHF 122.2 million (2013 adjusted1: CHF 150.1 million). Operating earnings (EBIT) stood at CHF 85.7 million (2013 adjusted1: CHF 112.9 million).

Net result came close to the previous year’s at CHF 67.4 million (2013: CHF 69.2 million, 2013 adjusted1: CHF 36.7 million) and includes almost CHF 2 million of costs already incurred for the announced sale of tour operating activities. The costs of
CHF 47.6 million in 2013 relating to the withdrawal from loss-making European tour operating activities mainly affected the financial result in 2013.

Cash flow from operating activities came to CHF 64.0 million (2013: CHF 160.4 million). Free cash flow stood at CHF 33.2 million (2013: CHF 124.6 million). This decline was due mainly to lower operating earnings (EBIT), as well as swings in Net Working Capital.

Kuoni Group’s equity at 31 December 2014 came to CHF 779 million (31.12.2013:
CHF 779 million). The equity ratio was practically unchanged at 32.2% (31.12.2013: 32.6%).

As at 31 December 2014, Kuoni Group had a total of 11 934 employees (FTE) (2013: 11 478 FTE). While headcount was reduced in most units, it rose in the two growth areas FIT and VFS Global.

Distribution proposed to the General Meeting of Shareholders

The Board of Directors, based on its current dividend policy, proposes to shareholders to distribute 40-45% of the net result attributable to shareholders. Accordingly, the Board of Directors is asking the Annual General Meeting of 20 April 2015 to approve an unchanged distribution of CHF 1.50 per registered share A and CHF 7.50 per registered share B. This corresponds to a distribution ratio of 43.7%. The dividend would take the form of a withholding tax-free distribution against reserves from capital contributions. The ex-dividend date is 22 April 2015. The value date for the distribution is 24 April 2015.

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

Kuoni Group figures

Income statement

CHF million 2014 2013 Change in %
Turnover 5,508.5 5,668.9 –2.8
Direct costs –4,483.4 –4,563.4 1.8
Gross profit 1,025.1 1,105.5 –7.3
Personnel expense –557.4 –548.5 –1.6
Marketing and advertising expense –59.8 –64.4 7.1
Other operating expense –234.7 –250.1 6.2
Share in result from joint ventures –2.0 –2.7 25.9
Depreciation –49.0 –48.4 –1.2
Operating earnings before amortisation (EBITA) 122.2 191.4 –36.2
Amortisation –36.5 –37.2 1.9
Operating earnings (EBIT) 85.7 154.2 –44.4
Financial income 12.0 6.2 93.5
Financial expense –7.5 –58.2 87.1
Result before taxes 90.2 102.1 –11.7
Income taxes –22.8 –32.9 30.7
Net result 67.4 69.2 –2.6
Of which:      
Attributable to non-controlling interests 1.0 1.1  
Attributable to shareholders of Kuoni Travel Holding Ltd 66.4 68.1  
       
Basic earnings per registered share A in CHF 3.44 3.55  
Diluted earnings per registered share A in CHF 3.44 3.55  
       
Basic earnings per registered share B in CHF 17.20 17.77  
Diluted earnings per registered share B in CHF 17.20 17.77  

Breakdown of turnover
(as per new structure from 2015)

CHF million 2014 2013 Change in %
Global Travel Services      
Group Travel 873 943 -7.4
FIT (Fully Independent Traveller) 1,933 1,802 7.3
Outbound & Specialists      
Outbound Nordic 844 982 -14.1
Outbound Europe/Asia 1,343 1,414 -5.0
remaining activities 1,343 1,355 -0.9
sold/closed activities   59  
Destination Management Specialists 365 417 -12.5
VFS Global 271 244 11.1
Turnover elimination -121 -133  
Kuoni Group 5,508 5,669 -2.8

1 Restatement of comparative period figures due to the decision to sell all outbound tour operating activities and the inbound business activities in India.

2 Incl. positive contribution of CHF 10.1 million from the disposal of a property in Zurich in first half of 2014.

3 Incl. CHF 3.0 million charges due to realignment of IT structure as part of restructuring of GTS Division.

4 Incl. charges of CHF 19.4 million as part of restructuring of GTS Division (Impairment of other intangible assets of CHF 16.4 million plus CHF 3.0 million realignment of IT structure).

5 Incl. CTA of CHF -160.6 million.

Breakdown of turnover
(as per old 2014 structure)

CHF million 2014 2013 adjusted 1 2013 Change in % 2
Global Travel Distribution (GTD) 63.2 73.0 74.5 -13.4
Global Travel Services (GTS) 4.8 29.6 33.2 -83.8
  Acquisition and integration cost 0.0 -4.7 -4.7  
VFS Global 52.5 40.2 40.2 30.6
         
Outbound Units 12.9 43.4 71.9 -70.3
         
Corporate -11.2 -31.4 -23.7 64.3
Kuoni Group 122.2 150.1 191.4 -18.6

1 elimination according to the 2014 segment reporting

Breakdown of EBITA
(as per new structure from 2015)

CHF million 2014 2013 adjusted 1 2013 Change in % 2
Global Travel Services        
Group Travel 16.9 23.2 26.8 -27.2
FIT (Fully Independent Traveller) 63.2 73.0 74.5 -13.4
Acquisition and integration cost 0.0 -4.7 -4.7  
Outbound & Specialists        
Outbound Nordic -7.6 37.8 37.8  
Outbound Europe/Asia 20.5 5.6 34.1 266.1
remaining activities 20.5 8.6 37.1 138.4
sold/closed activities   -3.0 -3.0  
Destination Management Specialists -12.1 6.4 6.4  
VFS Global 52.5 40.2 40.2 30.6
Corporate -11.2 -31.4 -23.7 64.3
Kuoni Group 122.2 150.1 191.4 -18.6

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

2 2013 adjusted vs 2014

Breakdown of EBITA
(as per old 2014 structure)

CHF million 2014 2013 adjusted 1 2013 Change in % 2
Group Travel 16.9 23.2 26.8 –27.2
FIT (Fully Independent Traveller) 63.2 73.0 74.5 –13.4
Acquisition and integration cost 0.0 –4.7 –4.7  
Outbound & Specialists        
Outbound Nordic –7.6 37.8 37.8  
Outbound Europe/Asia 20.5 5.6 34.1 266.1
remaining activities 20.5 8.6 37.1 138.4
sold/closed activities   –3.0 –3.0  
Destination Management Specialists –12.1 6.4 6.4  
VFS Global 52.5 40.2 40.2 30.6
Corporate –11.2 –31.4 –23.7 64.3
Kuoni Group 122.2 150.1 191.4 –18.6

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

2 2013 adjusted vs 2014

Breakdown of EBIT
(as per new structure from 2015)

CHF million 2014 2013 adjusted 1 2013 Change in % 2
Global Travel Distribution (GTD) 42.0 51.5 53.0 -18.4
Global Travel Services (GTS) -3.4 21.2 24.8  
Acquisition and integration cost 0.0 -4.7 -4.7  
VFS Global 52.5 40.2 40.2 30.6
         
Outbound Units 5.8 36.1 64.6 -83.9
         
Corporate -11.2 -31.4 -23.7 64.3
Kuoni Group 85.7 112.9 154.2 -24.1

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

2 2013 adjusted vs 2014

Breakdown of EBIT
(as per old 2014 structure)

CHF million 2014 2013 adjusted 1 2013 Change in % 2
Global Travel Services        
Group Travel 12.4 18.7 22.3 –33.7
FIT (Fully Independent Traveller) 42.0 51.5 53.0 –18.4
Acquisition and integration cost 0.0 –4.7 –4.7  
Outbound & Specialists        
Outbound Nordic –8.5 36.8 36.8  
Outbound Europe/Asia 14.3 –0.7 27.8  
remaining activities 14.3 2.4 30.9 495.8
sold/closed activities 0.0 –3.1 –3.1  
Destination Management Specialists -15.8 2.5 2.5  
VFS Global 52.5 40.2 40.2 30.6
Corporate -11.2 -31.4 -23.7 64.3
Kuoni Group 85.7 112.9 154.2 -24.1

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

2 2013 adjusted vs 2014

Turnover Outbound Units

CHF million 2014 2013
Outbound Nordic 844.1 982.2
Switzerland 679.1 722.9
United Kingdom 409.8 402.1
Benelux Specialists 37.1 39.3
India 138.5 125.0
Hong Kong/China 78.8 65.9

Gross profit Outbound Units

CHF million 2014 2013
Outbound Nordic 125.9 188.2
Switzerland 150.5 156.7
United Kingdom 77.9 74.4
Benelux Specialists 7.9 8.3
India 24.9 22.1
Hong Kong/China 12.4 10.4

Operating earnings before amortisation (EBITA) Outbound Units

CHF million 2014 2013 adjusted 1
Outbound Nordic -7.6 37.8
Switzerland 12.2 8.3
United Kingdom 9.0 8.0
Benelux Specialists 0.7 1.6
India -2.0 -8.8
Hong Kong/China 2.9 2.2

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

Operating segments

Reporting in accordance with old 2014 segment structure

Group Travel (new part of Global Travel Services, GTS)

Turnover came to CHF 873 million (2013: CHF 943 million). The organic decline of
-6.5% can be attributed primarily to lower demand in the Japanese market following the increase of the consumer tax and the devaluation of the yen. Meanwhile, the booking trend in Taiwan, South Korea, India and Hong Kong was positive. The competitive environment temporarily became tougher owing to reduced demand in key Asian markets. A lower gross profit margin had to be accepted as the price of maintaining a leading position in the most important markets. Operating earnings before amortisation (EBITA) came to CHF 16.9 million (20131: CHF 23.2 million). Operating earnings (EBIT) stood at CHF 12.4 million (20131: CHF 18.7 million). The number of room nights booked fell by 3.0% to 3.1 million.

FIT (Fully Independent traveller, new Global Travel Distribution, GTD)

The FIT business area increased turnover to CHF 1 933 million (2013: CHF 1 802 million). Organic turnover growth came to 8.8%. More than 13 million room nights in hotels were booked in a single financial year for the first time. Source markets in Asia/Pacific, the Middle East, Central Europe and Africa contributed most to the increase. In Asia (excluding Japan) there was organic growth of 13%. Operating earnings were affected by the cost of updating e-commerce platforms and by higher staffing costs resulting from the growth strategy. Operating earnings before amortisation (EBITA) came to CHF 63.2 million (20131: CHF 73.0 million). Operating earnings (EBIT) stood at CHF 42.0 million (20131: CHF 51.5 million).

Outbound Nordic

Outbound Nordic was heavily affected by the challenging market environment. Demand was reduced as a result of geopolitical events (political unrest in Egypt and Thailand), negative currency influences and very good spring and summer weather in Scandinavia. Excess flight capacity significantly lowered the level of achievable prices and margins. Outbound Nordic reported turnover of CHF 844 million (2013: CHF 982 million). Earnings before amortisation (EBITA) fell to CHF -7.6 million (2013:
CHF 37.8 million). EBIT went down to CHF -8.5 million (2013: CHF 36.8 million).

Outbound Europe/Asia

Tour operating activities saw operating earnings (EBIT) go up again namely thanks to business in the important summer quarter. In the Swiss market in particular, rainy summer weather helped to boost demand and earnings. Despite travel warnings for important destinations in Kenya and Thailand, the UK market generated higher earnings. Activities in India and Hong Kong/China also achieved better results. Turnover for 2014 stood at CHF 1 343 million (2013: CHF 1 414 million). Earnings before amortisation (EBITA) improved significantly to CHF 20.5 million (20131:
CHF 5.6 million). Operating earnings (EBIT) stood at CHF 14.3 million (20131:
CHF -0.7 million).

Destination Management Specialists (new part of Global Travel Services, GTS)

There was a mixed performance from the Destination Management Specialists, which are active in various regions. Geopolitical events had a very negative impact on results. Specifically in Kenya and Thailand temporary travel warnings prompted by political conflicts led to falling demand. The United Arab Emirates and South Africa were affected by the lower number of tourists from Russia and the Ukraine, and suffered as a result from increased pressure on prices. Meanwhile, demand for travel to India went up owing to the cheaper rupee. Turnover at the Destination Management Specialists unit fell to CHF 365 million (2013: CHF 417 million). Earnings before amortisation (EBITA) came to CHF -12.1 million (2013: CHF 6.4 million). EBIT stood at CHF -15.8 million (2013: CHF 2.5 million).

VFS Global

The world’s leading visa services provider continued to perform very well, achieving higher turnover and operating earnings. Turnover rose by 11.1% to CHF 271 million (2013: CHF 244 million). The increase can be attributed to growth in regions with higher visa fees, and to the introduction of the first front office services (FOS). FOS offer governments and authorities in-country public citizen services. The first services were launched in Asia, Africa and Europe. EBITA and EBIT increased to CHF 52.5 million (2013: CHF 40.2 million), a rise of 30.6%. In 2014, 18.2 million applications were processed and almost 6 million biometric data sets were recorded. Activities in the Ukraine and Russia in particular declined significantly, but this was offset by the increase in applications from Asia. At the end of 2014, VFS Global was operating 1 486 application centres in 120 countries for 45 governments. A total of 54 application centres in 26 countries were opened as part of the joint venture to serve the Kingdom of Saudi Arabia.

1 excluding the effect of Swiss pension plan changes and a curtailment of CHF 41.3 million in total

Property sale (information from 21 August 2014)

In consequence to a better use of office capacity and the aim to exploit synergies at Kuoni’s head office in Zurich, the business activities of the specialist Swiss tour operators were moved from the “Geroldstrasse” building to the “Neue Hard” building. Kuoni Group then sold the “Geroldstrasse” building, which it no longer needed, on 30.6.2014. This sale added CHF 10.1 million to operating earnings (EBIT).

This information on the 2014 financial year is also available in the original German.

The German version shall prevail.

Agenda 2015

Kuoni Group will report on its business performance as follows:

Capital Market Day                             11 June 2015
Half-year report                                 21 August 2015
Nine-month business update               5 November 2015

The General Meeting of Shareholders will be held in Zurich on 20 April 2015.

Information about the General Meeting of Shareholders on 20 April 2015

Ray Webster, Member of the Board of Directors of Kuoni Travel Holding Ltd. since 2006, has decided not to stand for another term of office. He will leave the Board of Directors at the Annual General Meeting of Shareholders on 20 April 2015.

The Board of Directors is proposing that the AGM elects Selina Neri to the Board. Selina Neri is an Italian citizen who has worked in the ICT industry for more than 22 years, most recently as Chief Executive Officer of online luxury fashion retailer Dadu Luxe based in Dubai. Selina Neri is, among other things, an expert in digital business transformation and e-commerce. She has an MBA from Clemson Business School, South Carolina, USA and a degree in economics from the University of Parma, Italy. Selina Neri’s detailed CV can be found at:
http://cr.kuoni.com/corporate-governance/annual-general-meeting/20151

All the other Members of the Board of Directors are standing for a further term of office.

The following agenda items are being put before the General Meeting of 20 April 2015 for voting:

1. Approval of the 2014 business review, financial statements and consolidated financial statements; acknowledgement of the auditors‘ report.

2. Appropriation of the 2014 balance sheet result, distribution
2.1 Appropriation of the 2014 balance sheet result
2.2 Distribution against statutory reserves from capital contributions

3. Discharge of the members of the Board of Directors and the Group Executive Board

4. Elections
4.1 Election of the Board of Directors
4.1.1 Re-election of Heinz Karrer
4.1.2 Re-election of Jae Hyun (Jay) Lee
4.1.3 Re-election of John Lindquist
4.1.4 Re-election of Adrianus (Adriaan) Nühn
4.1.5 Re-election of David J. Schnell
4.1.6 Re-election of Annette Schömmel
4.1.7 Election of Selina Neri
4.2 Re-election of Heinz Karrer as Chairman of the Board of Directors
4.3 Election of the Members to the Compensation Committee
4.3.1 Re-election of Jae Hyun (Jay) Lee
4.3.2 Re-election of Adrianus (Adriaan) Nühn
4.3.3 Re-election of Annette Schömmel
4.4 Re-election of REBER Rechtsanwälte, Zurich, as independent proxy
4.5 Re-election of KPMG AG, Zurich, as auditors

5. Amendment of the Articles of Incorporation. New article on Principles of Compensation, Performance-related Compensation as well as Participation and Option Plans

6. Compensation
6.1 Consultative vote on the 2014 Compensation Report
6.2 Approval of a maximum total amount for the compensation of the Board of Directors for the period until the next Annual General Meeting
6.3 Approval of a maximum total amount for the compensation of the Executive Board for the financial year 2016

7. Any other business

The official, complete and legally relevant invitation to the 89th Annual General Meeting of Kuoni Travel Holding Ltd for the business year 2014 including all agenda items, proposals as well as the explanations by the Board of Directors will be sent either by mail or electronically via the Sherpany online platform to all shareholders who are registered in the Company’s share register, and will be published on March 27, 2015 in the Swiss Official Gazette of Commerce.

The present announcement does not constitute an invitation to the annual general meeting of shareholders 2015.

Kuoni to focus on its core business as a service provider to the global travel industry 

14.01.2015

– Exit from tour operating activities

– Strategic initiatives to accelerate growth and profitability

– Turnover in 2014 of CHF 5.5 billion: at previous year’s level

Following a strategic review, Kuoni’s Board of Directors and Group Executive Board have decided to focus the company’s activities on its core business as a service provider to the global travel industry and to governments. In its new set-up, Kuoni Group will be structured into three divisions, Global Travel Distribution (GTD), Global Travel Services (GTS) and VFS Global. These core businesses benefit from leading global positions and exposure to high growth markets. They already represent around 60% of Kuoni’s current consolidated turnover. Kuoni’s position as a unique service provider with a strong focus on Asia offers attractive opportunities to further drive growth and profitability by leveraging the Group’s scale, exploiting cross-selling opportunities and developing more new business. In particular, Kuoni will focus on markets with attractive, long-term growth potential such as Asia, the Middle East and Africa. The travel market environment is likely to remain fast-changing, requiring travel companies to choose distinct development priorities. Kuoni has therefore decided to focus its resources and to divest its tour operating activities. On a pro-forma basis, the new Kuoni Group employs approximately 8 000 people and generated a turnover of CHF 3.4 billion in 2014. Post-divestment, as a unique and clearly focused company, Kuoni Group aspires to become a leading service provider to the global travel industry and to grow significantly faster than the travel market as a whole.

Focus on services for the global travel industry

Scale advantages, state-of-the-art technology, a global footprint and differentiated product offerings are becoming increasingly important in the global travel industry. The Board of Directors and the Group Executive Board have therefore decided to focus Kuoni’s activities on the three core businesses in which it already has leading global market positions. All three divisions are well placed to benefit in particular from the rapidly increasing number of Asian travellers:

– Global Travel Distribution (GTD, previously FIT) is an industry pioneer and a highly experienced, leading global B2B wholesaler and provider of hotel accommodation and land services. It sells approximately 38 000 room nights per day online. Around 43% of its turnover is sourced from fast-growing Asia/Pacific, the Middle East and Africa markets.

– Global Travel Services (GTS; comprised of Group Travel Experts and Destination Management Specialists, [DMS]) sources and coordinates destination services – from accommodation, transportation, tours and activities, to venues and event management. GTS is the number one player in the growing group travel market and handles
50 000 leisure tours per year. GTS generates 60% of its turnover from Asia/Pacific source markets.

– VFS Global, the industry pioneer and global leader in travel-related business process outsourcing solutions, works for 45 governments, operates 1 400 Visa Application Centres in 117 countries and holds an estimated 50% market share of the global outsourced visa applications market. It generates almost 70% of its turnover from travellers from the Asia/Pacific region.

Three strategic initiatives to accelerate growth and improve profitability

Its reduced portfolio of activities will enable Kuoni – re-branded as Kuoni Group – to focus on three key strategic initiatives to accelerate growth:

1. Kuoni Group will invest additional resources in Asia, the Middle East and Africa by leveraging its existing footprint and expanding its capabilities across all divisions.

2. Kuoni Group will focus on enhancing its customer service and increasing efficiency by developing new technology platforms and further digitalising its businesses.

3. The company aims to selectively expand its service offering and provide its existing services to a wider range of customer segments by utilising its cross-selling potential.

GTD as a business-to-business provider of accommodation and destination services will invest in developing innovative front-end sales solutions, explore new online distribution channels and offer services for online and offline travel agencies, tour operators and other intermediaries in all large travel markets around the world, with a particular focus on China, South Korea, Taiwan, Thailand and Indonesia. GTS as the leading destination service provider for people traveling in groups intends to significantly expand its presence in selected Asian markets by opening new offices, selectively partnering with leading market participants, and by focusing on digital distribution. VFS Global, as the number one service provider in the global outsourced visa application market, intends to expand into adjacent services, leveraging its innovative digitalisation technologies and existing network of more than 1 400 application centres in 117 countries.

Diverging performance of segments in 2014

While preliminary consolidated turnover of Kuoni in its current structure fell by -2.8% in the 2014 financial year to CHF 5 509 million (-0.1% organic), the three divisions which will represent Kuoni’s core business going forward showed a 1.1% increase in turnover to CHF 3 443 million (2.8% organic). Group Travel has seen a temporary slowdown in demand in the key Japanese market, which caused a 7.4% fall in turnover to CHF 873 million (-6.5% organic). The FIT business (future GTD), which provides accommodation and destination services, showed a 7.3% turnover increase to CHF 1 933 million (8.8% organic). Meanwhile, turnover at Outbound Nordic declined by -14.1% to CHF 844 million (-9.0% organic) and at Outbound Europe/Asia by -5.0% to CHF 1 343 million (-1.4% organic). The turnover of the DMS segment fell by -12.6% mainly due to geopolitical events to CHF 365 million (-9.0% organic). The VFS Global segment grew by 11.3% to CHF 272 million (14.2% organic). For full year 2014, Kuoni expects EBIT to be around CHF 85 million, with a net result of around CHF 66 million including accrued charges from the divestiture project. The full year results will be announced as previously stated on 17 March 2015.

New owners for Kuoni’s tour operating activities

Kuoni’s tour operating activities offer outbound leisure travel from European and Asian source markets including a variety of tailor-made, individual and packaged holidays, predominantly to local end-consumers. Kuoni operates under a range of premium and specialist brands and is well known and trusted due to its long-standing experience and significant expertise in the travel sector. Kuoni ranks among the top five tour operators in Europe and has a well-established presence in Hong Kong and India. In spite of this position, Kuoni’s outbound business faces increasing challenges from changing market conditions. In consideration of the fundamental changes in the industry and the unique position of Kuoni Group as a leading service provider to the global travel industry, the Board of Directors and Group Executive Board have decided to focus the company’s resources on those core activities in which Kuoni already enjoys a leading market position with attractive prospects. Kuoni has therefore decided to exit the tour operating businesses.

This exit from the tour operating business includes Kuoni Switzerland, UK, Benelux, Hong Kong/China and India as well as operations in Scandinavia/Finland. This affects approximately
3 800 people in total and business that generated turnover of CHF 2.2 billion in 2014. Kuoni firmly believes that the outbound business can be better developed under new ownership, potentially leveraging scale or specific local strengths. Kuoni will seek assurance about the continuation of the existing business locations and the continued employment of staff.

The exit from the tour operating business will not have any impact on customers or their current and future bookings. All units will continue to deliver their expert services to the accustomed standards of quality and reliability. Kuoni intends to find new owners in the course of 2015.

A unique and clearly focused company with market-beating growth aspirations

Kuoni Group will become a focused and clearly positioned player in the global travel industry, and will have attractive growth prospects. It aspires to grow significantly faster than the global travel markets, which according to UNWTO will expand by 3.8% annually, and it will continue to generate strong cash flow. Kuoni Group will build on robust financial foundations, which will support the implementation of its growth strategy in the emerging travel markets of Asia, the Middle East and Africa. Proceeds from the sale of the tour operating businesses will mainly be invested to further develop the group’s core business and strengthen its leading global market positions. On a pro-forma basis, the new Kuoni Group employed approximately 8 000 people and generated revenues of CHF 3.4 billion in 2014. Mid-term targets for the new set-up will be issued together with the full year results announcement on 17 March 2015. Net Result 2015 is expected to be negatively impacted by divestiture charges of approximately CHF 25 million, while the proceeds from divestiture are expected to be generated more likely in 2016.

Kuoni’s Board of Directors intends to maintain the dividend pay-out ratio of 40-45% of the net result attributable to shareholders, excluding non-recurring items from the divestment process.

Following the decision to refocus Kuoni’s activities, responsibilities within the company’s Group Executive Board have been adjusted with immediate effect as follows: Peter Meier (CEO), Thomas Peyer (CFO), Ivan Walter (Global Travel Distribution), Rolf Schafroth (Global Travel Services) and Zubin Karkaria (VFS Global). In addition, Rolf Schafroth will continue to lead Kuoni’s outbound activities.

Chairman Heinz Karrer said: “Kuoni Group’s new strategic direction will transform the company into a unique, clearly positioned player in the global travel industry. The new group focus will lead to a win-win situation for customers, employees, shareholders and partners alike.”

CEO Peter Meier said: “We are committed to further developing our core business and to rapidly and sustainably growing our core business as a leading service provider for the global travel industry. We will offer our customers, partners and suppliers attractive and competitive services and solutions that allow them to provide their clients with a smooth travel experience.”

Investor Presentation for Download http://cr.kuoni.com/download-center/investor-presentations/2015

Invitation to a press conference for media and journalists

Chairman Heinz Karrer, CEO Peter Meier and CFO Thomas Peyer will host a press conference (in German) to comment on the new strategic direction on

14 January 2015 at 09:30 a.m. CET at the SIX Convention Point, Selnaustrasse 30, Zurich.

Invitation to a conference for analysts and investors

Chairman Heinz Karrer, CEO Peter Meier and CFO Thomas Peyer will host an analyst conference (in English) to comment on the new strategic direction on

14 January 2015 at 12:00 noon CET at the SIX Convention Point, Selnaustrasse 30, Zurich.

Ivan Walter appointed Executive Vice-President Global Travel Distribution division and member of Kuoni Group’s Executive Board

14.01.2015

Kuoni Group’s Board of Directors appointed Ivan Walter as new member of the Executive Board with immediate effect. He will lead the Global Travel Distribution (GTD) division. Ivan Walter has been with the Kuoni Group since 2001.

Ivan Walter joined Kuoni Destination Management in 2001 as Head of FIT Europe (fully independent traveller). In 2005 he was named Head of Kuoni Connect, Kuoni Group’s FIT accommodation wholesale business. He was responsible for transforming the European Unit into a global organisation. After the acquisition and integration of GTA, Ivan Walter led GTA’s operation as of April 2013. He holds an Executive Master of Business Administration from the University of Applied Sciences of Eastern Switzerland. Ivan Walter is a Swiss citizen and is based in London.

Global Travel Distribution (GTD, previously FIT) is an industry pioneer and a highly experienced, leading global B2B wholesaler of hotel accommodation and land services. It sells approximately 38 000 room nights per day online. Around 43% of its turnover is sourced from fast-growing Asia/Pacific, the Middle East and Africa markets.