TUI Group PLC (LON:TUI) posted a 7.5% drop in third-quarter earnings but said summer bookings were ahead of last year despite people staying put during the heatwave across Europe.
The tour operator said underlying earnings (EBITDA) fell to €293.6mln in the three months to June 30 from €317.3mln a year ago, hit by an earlier Easter and €13mln in disruption costs related to air traffic control strikes in France.
Total turnover grew 5% to €5.0bn with growth across all divisions and regions, particularly in hotels and resorts, cruises, destination experiences and holiday bookings in the central region.
TUI said its strategy to invest in its own cruises and hotels in recent years buoyed results this year.
Despite a strong run of hot weather in Europe, the company said summer bookings for 2018 rose 4% with 86% of the programme sold thanks to more customers booking early this year.
Spain remained its top destination but the strongest growth in holiday bookings to Turkey, North Africa, Greece, Bulgaria, Croatia and Cyprus.
For the year, TUI continues to expect underlying EBITA to rise by at least 10% to €1.1bn and turnover to increase 3% to €18.5bn.
Shares fell 8.3% to 1,450p in morning trading.
AJ Bell investment director Russ Mould said: "The market appears to be sceptical of TUI’s pledge to achieve full year guidance, perhaps mindful of its rival Thomas Cook guiding for results to be at the lower end of expectations last week."