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Travel and shipping firm posts first-quarter profit

GERMAN travel and marine shipping company TUI AG said yesterday that gains on the sale of a stake in its Hapag-Lloyd marine shipping unit helped push it to a first quarter net profit.

The Hanover-based company said it earned 415 million euros (US$564.5 million) in net profit for the January-March period, compared with a net loss of 279 million euros in the first quarter of 2008.

Sales for the period, however, were 15 percent lower at 3.1 billion euros from 3.6 billion euros in the first quarter of 2008 as less people vacationed during the recession.

TUI booked a net gain of 990 million euros in the quarter from the sale of a stake in its marine division, partly to a consortium of investors including the city of Hamburg. Hapag-Lloyd is the world's 5th-largest marine shipper by volume, according to TUI, which still holds around a 40 percent stake.

Looking ahead, TUI said travel sales for the summer season are 13 percent lower than a year ago. The company said it expects an overall decline in sales because of the weak economy and a persistently weak exchange rate for the British pound. The company said it was not yet possible to assess any impact of the swine flu outbreak.

The company said its remaining container shipping business is expected to record a marked decline in earnings due to the global economic crisis.

However, TUI said it expects a positive result for the full year due to lower costs in the travel division and gains from the marine unit.


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