A favourable year Annual Report 2004

Transcription

Annual Report 2004
A favourable year
Group turnover of CHF 3 581 million, an 8.7 % increase on the previous year
(2003: CHF 3 295 million), or a 14.0 % increase excluding BTI
A slight 1.4% increase in operating costs (excluding BTI)
EBITA of CHF 127.6 million substantially above prior year (2003: CHF 102.4 million)
EBITA margin improved to 3.6 % (2003: 3.1 %)
Net result of CHF 73.8 million (2003: CHF 64.6 million)
Board of Directors to propose a CHF 35.00 reduction in the nominal value of the Kuoni
registered share B instead of a dividend
Shareholders’ equity of CHF 656.7 million and a balance sheet equity ratio of 36.1 %
Cash flow from operating activities of CHF 133.7 million
Focus on the leisure travel segment.
Contents
Facts and figures
A brief portrait of the Kuoni Group
8
14
21
47
Message to the shareholders
Organisation
14
The business model
16
The Group structure
17
The Board of Directors
18
The Group Executive Board
Reporting
21
Group
27
SBD Switzerland & Scandinavia
33
SBD Europe
37
SBD United Kingdom & North America
41
SBD Incoming & Asia
Market environment
47
53
The European travel sector
Responsibility
53
Personnel
56
The environment
58
Social commitment
60
Kuoni glossary
62
Addresses
64
Agenda
Photo captions
Enclosures
Financial reporting
Corporate governance
6
KUONI Annual Report 2004
7
An upward trend
Dear shareholder,
26 December 2004 will remain with us all for a long time to
come. Customers of our own Group’s companies were among
those who lost their lives when a tsunami swamped vast coastal
areas in Asia and around the Indian Ocean. Our thoughts are
with them and their families and friends, as they are with the
local people whom we know so well and who have been so
sorely tested by this tragic event. The disaster has made several
of us rethink our priorities. Many a previous concern now seems
far less important in the face of this catastrophe and its consequences. The many people who have incurred loss or bereavement as a result of this tragedy are showing – in a deeply
impressive way – their own desire to return to the day-to-day
Left: Andreas Schmid, Chairman of the Board of Directors
Right: Hans Lerch, Group Chief Executive Officer (until 31 January 2005)
and some kind of normality, even though their lives will never
be quite the same again.
The business results of the Kuoni Group were not unaffected by
the tsunami disaster, though the material damage is, of course,
of only secondary concern compared to the pain and suffering
caused by this event. With the exception of its final five days,
however, 2004 did bring a return to more normal conditions for
the tourist sector. For the first time since 2001, clear signs were
evident that not only had the downward trend bottomed out,
but the industry was making upward progress back to sustainable and profitable growth.
The first four months of 2004 brought significantly higher
booking volumes than had been seen the previous year. And
the prime beneficiary was the Asian region, which had suffered
most in 2003 as a result of the outbreak of SARS and avian
influenza. The growth in booking volumes for Europe was more
modest, and the Swiss, Austrian and German markets saw a
more hesitant recovery. Above-average growth rates were
reported, however, for Scandinavia, our European tour operating units and our Incoming business. In fact, all the Kuoni
Group’s strategic business divisions posted positive operating
results for the year. Only our US-based Intrav subsidiary continued to sustain substantial losses. But the company has been
making progress in 2005 to date.
8
Total turnover for the Kuoni Group in 2004 amounted to
Our customers have also become more demanding and less
CHF 3 581 million, an 8.7% increase on the prior-year result.
predictable in the last few years. The same customer is capable
Excluding the impact of the sale of the Group’s business travel
nowadays of taking a luxury Kuoni cruise for one vacation and
division, the year-on-year increase amounted to 14.0%. Earn-
spending the next on a beach holiday booked at a last-minute
ings before interest, taxes and amortisation of goodwill (EBITA)
price. This concentration of the market into an upper segment
rose 24.6 % to CHF 127.6 million, while the net result amounted
of high-value individualised products demanding extensive
to CHF 73.8 million. The balance sheet equity ratio increased to
advisory services and a lower segment in which the price is the
36.1 % – an above-average value for the travel sector.
decisive criterion is likely to increase.
Bookings for January 2005 were below their prior-year levels.
The growing flexibility being shown by customers, the increasing
But this is hardly surprising, in the wake of December’s Indian
individualisation of their wishes and needs and the continuing
Ocean disaster. Business is recovering week by week, however,
market volatility have confirmed the wisdom of Kuoni’s policy of
giving us grounds for guarded optimism for the year as a whole.
maintaining only modest vertical integration and clearly assigning its products to its various brands. We intend to retain our
The last few years have shown time and again how vulnerable
low levels of vertical integration and maintain our disciplined
the tourist sector is to global trends and events. Risks are part and
focus on our core leisure travel business; and we intend to
parcel of our industry and its activities. And those risks make us
remain the leading international premium and specialist tour
all the more aware that our business can only ever be planned up
operator. This will enable us to respond as flexibly as possible
to a certain degree. Those risks will never extinguish the appeal
to changes in markets and demand and offer our customers
of travel, our love of adventure and our desire to experience
the best products and services available in each of our markets.
other cultures. But changes in travel and booking behaviour will
increase the complexity of the demands made on Kuoni as a
We will also continue to strive for profitable growth. In doing so,
travel corporation. This is a challenge, however, to which we will
we will focus our capital resources primarily on developing our
rise with confidence and composure.
existing markets, be it by promoting organic growth or through
acquisitions of leisure travel providers within our overall strategy.
With the rapid pace of developments in the IT and communi-
A number of possible acquisitions were evaluated in the course
cations technology fields, not only are customers today better
of 2004. But either the companies evaluated were not for sale
informed than ever before; they are also increasingly prepared
or they did not meet our criteria in terms of their profitability
to perform certain functions – such as booking their trip – them-
and earnings potential.
selves. Indeed, in many countries, the Internet has already become
the most important travel preparation tool. What customers
expect today is a user-friendly, well-functioning and appealinglydesigned website that enables them to compile a trip according
to their own individual requirements. We are currently devoting
extensive resources to the structural changes associated with
these developments, to set a timely course now which will ensure
that we continue to meet our customers’ online needs.
9
In view of this, and as we mentioned in our 2003 annual report,
The employees of the Kuoni Group deserve our thanks and our
we have decided to use the additional liquidity presently avail-
recognition for the competence and the commitment they
able to us to repay the convertible bond and to return part of
showed throughout 2004. They have been consistently excellent
our shares’ nominal value to our shareholders, an action which
in representing the interests of our company.
is advantageous to our investors in fiscal terms. We intend to
maintain such a policy of repaying freely available liquidity not
Our sincere thanks go also to our shareholders and our cus-
required by the company to our shareholders in future, too.
tomers for their loyalty and for the confidence they continue to
And, should additional capital be needed to finance a major
place in our company. The Board of Directors and the Group
acquisition, we will ask our shareholders to approve a capital
Executive Board regard this as a confirmation of the course they
increase to raise the funds required.
have adopted, and as an incentive to maintain it and ensure our
Group’s continued positive development. And both will be
Hans Lerch, who, having served as Group Chief Executive Officer
doing everything in their power to further enhance the
for almost six years, handed over to his successor Armin Meier
dynamism and growth potential of the Kuoni Group, in the
on 1 February 2005, will be proposed for election to the Board
interests and to the benefit of all our various stakeholders.
of Directors at the 2005 General Meeting. The terms of office
of the Board members who are being proposed for election at
this year’s General Meeting are being deliberately staggered, to
ensure both continuity and flexibility at the Board level.
10
Andreas Schmid
Hans Lerch
Chairman of the Board of Directors
Group Chief Executive Officer
(until 31 January 2005)
The Board of Directors will propose the election of Hans Lerch to its ranks to the 2005 General Meeting of Shareholders. To respect the
relevant corporate governance principles, Hans Lerch decided in April 2004 to step down from his function as Group Chief Executive
Officer, a position he has held for the last six of the 34 years which he has devoted to the Kuoni Group. He handed over his Group CEO
duties to his successor Armin Meier on 1 February 2005.
On behalf of the Board of Directors, I offer Hans Lerch my sincere thanks for all his dedication to Kuoni to date. With his election to the
Board, Kuoni can continue to benefit from his extensive knowledge and his many years of experience in the travel and tourism sector.
I also extend a warm welcome to Armin Meier, and wish him every success and satisfaction in his new capacity.
Andreas Schmid
11
12
13
+++ Focus still
Clearly positioned in the market
on specialist
business +++
The business model
With its decades of experience, the globally active Kuoni Group
has a thorough and extensive competence as a provider of
leisure travel products and a specialist in the incoming sector.
Having continued to pursue this overall strategy, Kuoni made
full use of available synergies in 2004 while further aligning its
product portfolio to customers’ growing needs.
14
Organisation
Leisure Travel
Incoming Services
Organising leisure travel, advising customers and selling its
Incoming Services accounts for some 17 % of total Group turn-
products via various distribution channels are the core compe-
over and consists of three business units: Incoming Services
tencies of the Kuoni Group. Leisure travel is the Group’s strong-
Europe (which is headquartered in Zurich and operates various
est business segment, accounting for some 83 % of total turn-
destination management companies in Europe and sales offices
over. And tour operating is the foundation of these leisure
in Asia), Private Safaris Africa (with two subsidiaries domiciled
travel activities. The aim of tour operating is to select attractive
in Cape Town and Nairobi and a branch office in Mombasa)
vacation destinations and competent local agents, to work with
and AlliedTPro USA (with a head office in New York and branch
these local partners to conclude agreements with hotels and
offices in Los Angeles, Miami, Orlando and Hawaii). Incoming
other service providers such as transport companies, and to
Services offers professional “destination management” servic-
organise local transfers and excursions. Kuoni’s retailing oper-
es, organising and advising on land arrangements for groups,
ations ensure that its products are booked via the various
individual travellers, seminars, congresses and special interest
distribution channels including Kuoni travel offices, third-party
and incentive tours as well as sports events. Its clients include
agents and direct sales, with the overall aim of offering the
Kuoni’s own subsidiaries and other foreign tour operators.
customer the best possible product at the best possible price.
While Incoming Services Europe focuses on serving customers
While products requiring extensive advice still tend to be sold
from Japan, the Far East, the Middle East, India and the USA,
in the travel agency, booking via the Internet is becoming in-
the North American, Kenyan and South African subsidiaries
creasingly popular. Marketing supports Retailing by providing
work largely with European customers.
appropriate sales promotions. In Switzerland, Kuoni offers a full
range of products under its Kuoni, Helvetic Tours and Reisen
Netto brands. In other markets, the Kuoni Group is either positioned in the upper-to-middle pricing segments with its Kuoni
brand or is represented through a reputed local brand.
15
The Group structure
Board of Directors
Andreas Schmid
Corporate Secretary
Internal Audit
Armin Meier 1)
Corporate
Communications
Corporate
Development
Assurance
Management
General Counsel
Finance
Information
Technology
Corporate
Human Resources
Armin Meier 1)
Max E. Katz 1)
Konrad Iten 2)
Ursula
Meier-Bergundthal 2)
SBU Europe
Reto Wilhelm 1)
SBU India, Middle East
Ranjit Malkani 2)
Controlling
France
Voyages Kuoni SA
Vacances Fabuleuses SA
India
Kuoni Travel (India) Ltd.
Leisure Travel
Leisure Travel
Leisure Travel
Leisure Travel
Switzerland &
Scandinavia
United Kingdom &
North America
Continental Europe &
Incoming
Asia
Thomas Stirnimann 1)
Peter Diethelm 3)
Reto Wilhelm 1)
SBU Switzerland
Thomas Stirnimann 1)
SBU United Kingdom
Sue Biggs 2)
Switzerland
Kuoni Reisen AG
Edelweiss Air AG
Manta Reisen AG
PRZ AG
• Privat Safaris
• Rotunda Tours
• Intens Travel
Railtour Suisse SA
• ACS Reisen
United Kingdom
Kuoni Travel Ltd.
• Voyages Jules Verne
Netherlands
Kuoni Travel
Nederland BV
• Special Traffic
Travel Keys BV
• African Holidays
Business Analysis
Treasury
Italy
Kuoni Gastaldi Tours
S.p.A.
Mergers &
Acquisitions
Spain
Viajes Kuoni SA
Austria
Reisebüro Kuoni
Ges.m.b.H.
Restplatzbörse
Ges.m.b.H.
Investor Relations
Germany
Kuoni Reisen GmbH
SBU Scandinavia
Fons Brusselmans 2)
SBU USA
David Drier
SBU Incoming Services
Reto Wilhelm 1)
SBU China, Hong Kong
Reto Wilhelm 1)
Denmark
Kuoni Scandinavia AB
USA
Intrav Inc.
Europe
Kuoni Reisen AG
Hong Kong
P&O Travel Ltd.
Norway
USA
AlliedTPro Inc.
Sweden
Nova Airlines AB
Africa
Private Safaris
(EA) Ltd., Kenya
Kuoni Private Safaris Pty.
Ltd., South Africa
1)
Group Executive Board
Group Management Board
3)
Executive Chairman UK & USA
SBU Strategic Business Unit
2)
The different shades correspond
to the financial reporting structures.
As at March 2005
16
Organisation
The Board of Directors
Andreas Schmid, Chairman
Chairman of the Board of Directors of Barry Callebaut AG, Zurich;
Chairman of the Board of Directors of Unique (Flughafen Zürich AG);
Member of the Advisory Board of Credit Suisse Group, Zurich.
Current term expires in 2005.
Pierre Boppe, Vice-Chairman
President of The Stein Group, Barcelona;
Member of the Board of Directors of The Stein Group Management Company, Barcelona;
President of Luxury Lifestyle Hotels & Resorts, Barcelona;
Member of the Board of Directors of The Hongkong & Shanghai Hotels Ltd.,
Hong Kong;
Member of the Board of Directors of BlueOrchard Finance SA, Geneva.
Nils Hagander
Founder and Vice-Chairman of the Board of Directors of a-connect AG, Zurich;
Member of the Board of Trustees of the Pestalozzi Foundation.
David Schnell
Business Consultant;
Member of the Board of Trustees of the Kuoni and Hugentobler Foundation, Zurich;
Vice-Chairman of the Board of Directors of ELMA Electronic AG, Wetzikon;
Member of the Board of Directors of AlpTransit Gotthard AG, Lucerne;
Member of the Board of Directors of SIG Holding AG, Neuhausen.
Henning Boysen
Deputy Chairman of the Board of Directors of Gate Gourmet USAS;
Member of the Advisory Board of the Ecole hôtelière de Lausanne, Lausanne;
Member of the Advisory Board of the Copenhagen Business School, Copenhagen.
Annette Schömmel
Founder and Vice-Chairman of the Board of Directors of arthesia AG, Baar.
As at March 2005
Board members’ detailed CVs can be found on the Group’s website: www.kuoni.com.
17
The Group Executive Board
18
Hans Lerch
(until 31 January 2005)
Swiss, born 1950
Hans Lerch’s career at Kuoni began in
1970, when he joined the company as a
customer service representative in the
Incoming division. Up until the mid-1980s,
he held various management functions in
the Far East before being appointed Head
of Incoming Services in 1986. He became
Head of Tour Operating three years later
and remained in this post until 1995. As
a member of the Group Executive Board
and Executive Vice-President, he was
responsible for SBD Incoming Services and
for developing new markets from 1995
onwards. In 1996 he assumed additional
responsibility for SBU Switzerland. He was
appointed Kuoni Group Chief Executive
Officer in 1999, and served in this position
until January 2005.
Armin Meier
(since 1 February 2005)
Swiss, born 1958
Having initially trained as a primary school
teacher and spent some years in the teaching profession, Armin Meier embarked on
a career in information technology and
consulting which included a spell with
DEC Digital Equipment Corporation AG
and running his own consultancy company. Parallel to his business career, he
obtained a university of applied sciences
degree in IT engineering. After earning
an Executive MBA from the University of
St. Gallen, he was appointed CEO of ABB
PTI AG in Baden, Switzerland. In 1998
he moved to become CEO of Atraxis AG,
Zurich. Four years later he joined the Federation of Migros Co-operatives as a
member of its executive committee with
overall responsibility for logistics and IT.
He succeeded Hans Lerch as Kuoni Group
Chief Executive Officer at the beginning
of February 2005.
The Group Management Board
Konrad Iten, Swiss
Chief Information Officer;
Member of the Group Management
Board since 1999
Sue Biggs, British
Chief Executive Officer SBU United
Kingdom; Member of the Group
Management Board since 2001
Organisation
Max E. Katz
Executive Vice-President,
Chief Financial Officer
Swiss, born 1955
Max Katz graduated as a business economist in 1978 and started his career as a
brand manager at Unilever. From 1981
to 1987, he worked partly abroad as a
regional controller for Jacobs Suchard AG,
before becoming vice-president finance
and a member of the executive board of
Effems AG. He was appointed vice-president finance and a member of the executive board of Hürlimann Holding AG in
1991. In 1995 he joined Kuoni as a
Member of the Group Executive Board
and CFO.
Thomas Stirnimann
Executive Vice-President Leisure Travel
Switzerland & Scandinavia
Swiss, born 1962
The Head of Kuoni Switzerland began his
Kuoni career in 1978 as an apprentice and
subsequently worked in various departments before becoming a purchaser for
North America in 1987. From 1989 to
1991 he worked for Travac AG as a product manager, and then returned to Kuoni
as Head of Marketing & Sales. He became
Head of Overseas three years later and
was subsequently appointed Head of Tour
Operating in 1995. He has been in his
present post since 1999.
Reto Wilhelm
Executive Vice-President Leisure Travel
Continental Europe & Incoming
Swiss, born 1961
After graduating from the University of
St. Gallen, Reto Wilhelm gained his first experience of the travel and tourism business
in Kuoni’s purchasing operations in 1986.
He left three years later to join Marc Rich +
Co. AG. From 1990 to 2001 he was with
the Swissair Group, where he held various
management functions including general
manager network planning & fleet development. He was named route manager Middle East & Africa in 1998 and route manager
North & South America (based in New York)
a year later. In 2001 he was appointed to
Swissair’s executive management, with
overall responsibility for sales and airport
organisations worldwide. He returned to
Kuoni in 2002 to become Executive VicePresident SBD Leisure Travel Continental
Europe. He assumed additional charge of
SBU Incoming in 2004, and of P&O Travel
Hong Kong Ltd. in January 2005.
Fons Brusselmans, Belgian
Chief Executive Officer SBU Scandinavia;
Member of the Group Management Board
since 2002
Ranjit Malkani, Indian
Chief Executive Officer SBU India & Middle
East; Member of the Group Management
Board since 2002
Ursula Meier-Bergundthal, Swiss
Senior Vice-President Corporate
Human Resources; Member of the Group
Management Board since 2003
19
20
Reporting
Group
Another improved performance
+++ A profitable
annual result
achieved +++
Switzerland and UK & North America generate strongest earnings flows
EBITA a substantial improvement on the previous year
A balanced portfolio of business activities
The travel sector has been confronted with numerous unfavour-
With the market showing clear signs of recovery in 2004, the
able developments and constant new challenges since the
tour operators’ position with regard to their suppliers has also
events of 11 September 2001. But last year brought a tangible
returned to a more normal footing. As a consequence of this,
recovery in business volumes and trends. Not only had the
the gross profit margin could not be maintained at its prior-
decline of the last few years bottomed out; firm progress was
year record level of 24.8% (after elimination of the BTI busi-
being made back to sustainable and profitable growth – until
ness travel division), and returned to a more normal 22.9%.
the tsunami devastated vast coastal areas in Asia and around
But economies of scale helped raise the corresponding gross
the Indian Ocean on 26 December. But, given the series of
profit (excluding BTI) by 5.3% to CHF 818.9 million. With
external and uncontrollable influences of the past few years,
strict cost controls still in place, the increase in operating costs
the tourist industry and consumers alike have learned to live
(excluding BTI) was limited to 1.4%, substantially below the
with events of this kind.
turnover increase achieved. Earnings before interest, taxes and
amortisation of goodwill (EBITA) amounted to CHF 127.6 mil-
Once again, the Kuoni Group responded swiftly and flexibly to
lion, a 24.6 % improvement on the previous year (and an even
changed market constellations in the year under review, and
higher 32.8% increase excluding BTI). Without the negative
can therefore report above-average growth and a highly favour-
short-term effects of the tsunami disaster, which reduced the
able operating result. Having suffered substantial turnover
earnings result by just under CHF 10 million, EBITA for 2004
declines for the previous two years through a combination of
would have shown an improvement of some 34% on the pre-
external factors and proactive measures to reduce capacity levels,
vious year (or as high as around 43 % excluding BTI).
Kuoni raised its annual turnover 8.7% to CHF 3 581 million in
2004. Organic growth was even higher at 13.6 % (currency
movements 0.1 %, acquisition and divestiture effects –5.0%).
21
Pre-goodwill earnings (the net result before the amortisation of
SBU Scandinavia continued its impressive turnaround in 2004
goodwill) amounted to CHF 106.4 million. This compares to the
and posted a very favourable result. With operating costs
CHF 105.9 million (or CHF 63.2 million excluding BTI) recorded
remaining at prior-year levels, turnover was increased 18.8 %
for 2003. The prior-year net result of CHF 64.6 million (or
to CHF 595 million, thanks largely to strong demand in the
CHF 31.3 million without BTI) was raised to CHF 73.8 million
Swedish and Norwegian markets. The unit’s gross profit margin
for 2004. The increase is attributable primarily to the substan-
declined from the record 29.0% of the previous year to 25.7%.
tial improvement in the EBITA result. Instead of the distribution
But economies of scale helped raise EBITA from CHF 9.0 million
of a dividend (a dividend of CHF 7.00 per registered share B
to CHF 16.4 million, an improvement of 82.2 %.
was paid for 2003), the Board of Directors will recommend to
the General Meeting of Shareholders that the nominal value of
SBD Europe, which had seen turnover stagnate the previous
registered shares B be reduced by CHF 35.00 per share, with a
year, embarked on a sizeable expansion in 2004 and raised its
corresponding repayment to shareholders.
annual turnover 22.3 % to CHF 597 million. The weak demand
in the Austrian and German retailing markets was more than
Following the sale of its BTI business travel operations, the
offset by strong growth in the tour operating sector, especially
Kuoni Group now consists of four Strategic Business Divisions or
in France, Spain and Italy. With an advantageous product mix
SBDs. In view of its significance within the Group, the results
and effective capacity management, the division raised its
of SBD Switzerland & Scandinavia are presented separately for its
gross profit margin from 20.5% to 22.5 %; and EBITA saw a
two constituent Strategic Business Units or SBUs.
correspondingly substantial 84.3% improvement, rising from
CHF 8.3 million to CHF 15.3 million.
The various business entities reported the following
SBD United Kingdom & North America experienced differing
turnover trends:
trends in its two markets in 2004. Kuoni UK raised turnover by
12.5% and, despite a slight decline in gross profit margin,
CHF million
maintained its EBITA at its prior-year level, producing a further
1200
2003
double-digit EBITA margin of 10.2%. Results for North America,
2004
1000
800
however, were well below expectations, through a combination
870
of continuing weak demand and a relatively high fixed-cost
890
827
501
730
597
595
400
component.
756
600
SBD Incoming & Asia achieved a sizeable 32.5 % increase in
551
488
its turnover, despite adverse currency trends (with turnover for
200
167 167
0
Switzerland Scandinavia
Europe
UK & North
America
Incoming
& Asia
Business
Travel
Asia showing an even higher increase following the SARS-related collapse of business in 2003). While gross profit margin
showed a year-on-year decline, an increase in operating costs
which was well below turnover growth helped raise EBITA from
CHF 2.6 million to CHF 17.8 million, with the incoming business
SBU Switzerland increased its turnover 2.3% in a generally
stagnant market (or 6.3% excluding the impact of the sale of
Hellenic Tours). Despite gross profit margin declining from
28.5% to 26.8%, EBITA for the unit was increased from the
CHF 29.7 million of 2003 to CHF 34.2 million – an improvement that can be primarily ascribed to a further substantial
reduction in operating costs.
22
achieving a striking improvement in results.
Reporting
Group
The charts below show a breakdown of total turnover by
ingly from its prior-year record level of 24.8% to a more nor-
SBD/SBU and by activity:
mal 22.9%. This reduced the EBITA result by CHF 68 million.
The turnover growth achieved also entailed a CHF 10 million
Switzerland
25%
Incoming & Asia
20%
increase in operating costs. But the 1.4% year-on-year increase
which this represents was well below the corresponding turnover growth. As a result of these three factors, EBITA for 2004
was a CHF 31 million improvement on the prior-year result.
UK & North America
23%
CHF million (excluding BTI)
Scandinavia
16%
120
100
80
Europe 16%
–68
60
109
40
–10
20
31
0
Incoming Services
17%
Impact of
turnover on
gross profit
Increase in
operating costs
Decline in
gross profit
margin
Increase in
EBITA
A breakdown of the EBITA of CHF 127.6 million by business
entity produces the following picture:
Leisure Travel
83%
CHF million
90
2003
80
2004
70
The sale at the end of 2003 of SBD Business Travel and the
weaker turnover growth reported by the two larger entities of
SBU Switzerland and SBD United Kingdom & North America
compared to the increases seen at SBU Scandinavia, SBD Europe
and SBD Incoming & Asia have reduced the differences in
turnover volumes among the Group’s constituent entities. The
Group’s business portfolio shows a balanced distribution of
turnover across its five entities. In terms of its operations, the
Kuoni Group has positioned itself since 2004 as a pure leisure
60
50
70
40
63
30
20
30
34
–14
10
9
0
Switzerland
16
Scandinavia
8
15
Europe
3
UK & North
America
18
Incoming
& Asia
travel organisation active in the two business segments of
Leisure Travel (which accounts for 83 % of total turnover) and
Once again, SBU Switzerland and (in particular) SBD United
Incoming Services (which contributes 17 %).
Kingdom & North America remained the Group’s strongest
earnings generators, accounting between them for some two-
Earnings before interest, taxes and amortisation of
thirds of the Group operating result (compared to 83 % in 2003).
goodwill (EBITA) were increased 32.8% in 2004 from CHF
Sources of particular satisfaction in 2004 were the completion
96.1 million (excluding the BTI business travel division) to CHF
of the turnaround in Scandinavia, the further substantial earn-
127.6 million, resulting in a turnover-based EBITA margin of
ings gains in Europe and the sizeable leap in profits at SBD
3.6 % (compared to 3.1% for the previous year). The positive
Incoming & Asia. In view of these performances, these entities
effect of the higher turnover volumes contributed CHF 109 mil-
considerably increased their own contributions to the Group
lion to the EBITA result. With business activity continuing to
EBITA result, and thereby reduced the Group’s dependency on
recover, the supply/ demand situation has returned to more
SBU Switzerland and SBD United Kingdom & North America.
normal conditions, limiting the options for supplier renegotiations. Gross profit margin (the relation of gross profit after
deduction of bought-in services to turnover) declined accord-
23
Goodwill amortisation declined from CHF 41.2 million to
With the capital structure remaining unchanged, earnings per
CHF 32.6 million. The reduction is due partly to the depreciation
registered share B rose in proportion to the increase in the net
of foreign currencies against the Swiss franc and partly to the
result from CHF 21.86 to CHF 24.88. While the last few years
disposal of subsidiaries (and of BTI in particular). In accordance
have seen between 30% and 35% of the net result distributed
with IFRS accounting standards, goodwill from acquisitions will
as a dividend to shareholders in accordance with the Group’s
no longer be systematically amortised from 2005 onwards. But
long-term flexible dividend policy, the Kuoni Board of Directors
such goodwill will continue to be subjected to an impairment
will recommend to the General Meeting of Shareholders of
test to assess its fair market value.
21 April 2005 that, instead of a dividend, a one-off fiscallyattractive reduction of CHF 35.00 be effected to the nominal
The Kuoni Group reported net financial income of CHF 10.9 mil-
value of the Kuoni registered share B. This compares with a divi-
lion, which compares to a net financial expense of CHF 5.4 mil-
dend payment of CHF 7.00 per share for the 2003 business year.
lion incurred in 2003 (excluding the gain from the sale
of the BTI business travel division). The financial income of
Capital expenditure on tangible fixed assets totalled
CHF 27.6 million (2003: CHF 18.0 million) includes interest
CHF 38.2 million in 2004, a CHF 10.2 million increase on the
income derived from the investment of operating liquidity. These
previous year. This amount is derived from numerous smaller
funds are placed exclusively in time deposits. It also includes
projects designed to replace or expand the Group’s infrastruc-
income from shareholdings (gains from the sale of the 49%
tural facilities. No major investments were effected in the course
holding in TUI Suisse, two hotels in Antigua and Barbados and
of the year.
Greek subsidiaries Hellenic Tours and Hellenic Island Services).
Financial expense includes outlays for the 3.52% interest appli-
The Kuoni Group held cash and cash equivalents of
cable to the 2000–2005 1% convertible bond in accordance
CHF 756 million on 31 December 2004, an increase of 22.6%
with IFRS principles, for interest on bank debts and for the dis-
on the prior-year level. The advance payments from customers
count on a provision for onerous contracts effected in 2001 in
included in this amount totalled CHF 305.7 million (2003:
respect of an Airbus A330-200, and non-operating exchange
CHF 256.2 million). The Kuoni Group remains in comfortable
rate losses.
financial condition, with no net debt but with net cash of
CHF 222.9 million. Cash flow from operating activities amount-
Despite the improved EBITA result, the tax expense of
ed to CHF 133.7 million in 2004, compared to CHF 74.4 million
CHF 31.9 million was lower than the CHF 42.6 million incurred
for the previous year.
the previous year (due to the sale of BTI). Goodwill is normally
not tax-deductible, and taxes should therefore be seen in rela-
The shareholders’ equity of the Kuoni Group rose from
tion to earnings before goodwill amortisation and taxes. The
CHF 612.9 million to CHF 656.7 million through the increase
tax rate showed a clearly positive trend in 2004, from 28.5 %
in reserves. The balance sheet equity ratio rose accordingly
to 23.0 %.
from 33.3% to 36.1 % – an above-average value for the travel
sector and one which reflects the Kuoni Group’s extremely
The Kuoni Group reported a net result of CHF 73.8 million for
sound balance-sheet health.
2004, an improvement of CHF 9.2 million on the previous year
and of as much as CHF 42.5 million excluding BTI. Net profit
The price of Kuoni’s registered share B rose 20.8% from
margin increased accordingly, more than doubling from 1.0 %
CHF 414.00 to CHF 500.00 in the course of 2004. Once again,
(excluding BTI) to 2.1 %.
the increase in the share’s price clearly outpaced both its benchmark Swiss Performance Index, which rose 6.9% over the same
Pre-goodwill earnings (net profit before goodwill amortisa-
period, and those of Europe’s other leading travel corporations,
tion), which will be identical to the net result from 2005
some of which even saw their share prices fall in the course of
onwards, increased slightly from the CHF 105.9 million of 2003
the year. The capital markets were evidently impressed with the
to CHF 106.4 million. Excluding the impact of the sale of BTI,
actions taken by the Kuoni Group in terms of its strategic posi-
pre-goodwill earnings increased CHF 43.2 million year-on-year.
tioning, its efforts to reduce its costs and ensure greater cost
Pre-goodwill earnings per registered share B amounted to
flexibility and its endeavours to optimise its product mix and
CHF 35.85 (compared to CHF 35.80 for the previous year).
retailing structures, all with a view to securing sustainable
improvements in shareholder value.
24
Reporting
Group
Performance of Kuoni shares (CHF)
At a glance
550
The Kuoni Group achieved above-average
525
growth and a highly favourable EBITA result
500
in 2004. SBU Switzerland and SBD United
475
Kingdom & North America remain the prime
contributors to the Group’s earnings results.
450
But SBU Scandinavia, SBD Europe and SBD
425
Incoming & Asia all recorded substantial
increases in their EBITA levels. As a result,
400
01/04 02/04 03/04 04/04 05/04 06/04 07/04 08/04 09/04 10/04 11/04 12/04
the Group’s EBITA is now spread far more
evenly among its five constituent entities
Outlook
than it was in previous years.
Guarded optimism is not out of place for the 2005 business
year. The geopolitical situation appears to be relatively stable,
Turnover
and economic indicators in the most important markets are
CHF billion
also largely positive. Prospects are good, therefore, that the
4
recovery witnessed in 2004 can be maintained. The beginning
of the year did see some reluctance among consumers following
3
the tsunami; but there are already signs that the ground lost
here in booking volume terms can be made up in the course of
2
the year.
1
Following its withdrawal from the business travel segment at
0
00
the end of 2003, the Kuoni Group is now exclusively focused on
01
02
03
04
03
04
the leisure travel sector in Europe and other strategic markets.
Kuoni’s declared policy of minimising its business risk by keeping
EBITA and net result
vertical integration as low as possible was maintained in 2004.
CHF million
The Group’s portfolio of business activities is a balanced one,
and the quality of its profits was substantially improved. With its
clear focus on the leisure travel segment, its flexible range of
products that are closely aligned to individual customer needs,
its continued strict cost management and its further efforts to
increase the flexibility of its contractual commitments, the Kuoni
Group has a sound and solid foundation in place to meet and
master the challenges ahead.
200
100
0
–100
– 200
– 300
00
01
02
Net result
EBITA
Earnings per registered share B
CHF
100
50
0
– 50
–100
00
01
02
03
04
25
26
Reporting
SBD Leisure Travel – Switzerland &Scandinavia
SBU Switzerland
Specialisation proves its worth
+++ Helvetic Tours
anniversary stimulates
turnover growth +++
Outlet network rationalised
Subsidiaries en route to success
Cost management strengthens EBITA result
Strategic Business Unit (SBU) Switzerland posted an encouraging result for 2004 in a fiercely contested market that saw
only marginal growth. Kuoni Switzerland and its 1 423 employees generated turnover for the year of CHF 890 million,
2.3% up on the CHF 870 million of 2003. Excluding the Greek
subsidiaries sold on 1 January 2004, turnover rose by 6.3%.
The Kuoni brand still accounts for some 60% of total turnover
volume, with the remaining 40% stemming from Helvetic
Tours, Reisen Netto and the various subsidiaries. Earnings before interest, taxes and amortisation of goodwill (EBITA) stood
at CHF 34.2 million, up CHF 4.5 million or 15.2 %. The EBITA
improvement was due in particular to consistent cost management and the adoption of the new retail strategy.
Kuoni Reisen Tour Operating:
market lead extended
Kuoni Switzerland’s tour operating business performed well in an
increasingly competitive environment. The Kuoni, Helvetic Tours
and Reisen Netto brands all showed positive trends – thanks,
among other things, to the magazine-style catalogue concept
adopted for the Kuoni brand, whose January 2004 launch ushered
in a new era of catalogue design. The promotional activities surrounding the 20th anniversary of Helvetic Tours also prompted
numerous customers to abandon their usual late-booking habits
and book their summer and autumn vacations at the beginning of
the year. With a view to further consolidating its quality leader
position, Kuoni Switzerland introduced its new “World Class”
luxury product in summer 2004. The new concept offers fiveand six-star products to 30 exclusive vacation destinations for
the top-price segment. The year also saw the relaunch of the
cruise product range and, in early autumn, the publication of
a dedicated river cruise catalogue. On the medium-haul front,
Greece, Turkey, Cyprus and Egypt proved especially popular in
2004. Demand for the Canary Islands was more muted. Among
long-haul destinations, the Far East, the Caribbean, the Maldives
and Canada all grew in popularity, while interest in Rio de Janeiro
fell short of expectations.
27
Kuoni Reisen Retailing:
new course set
Manta Reisen:
sustained success
Kuoni Switzerland steadily implemented its new retailing strategy
Manta Reisen, which specialises in travel to the Indian Ocean (the
from January 2004 on. These actions, which cut the number of
Maldives, Mauritius and the Seychelles) and in diving holidays
retail outlets from 115 to 103, were primarily aimed at eliminat-
(especially to Egypt), maintained its strong performance of the
ing locational disadvantages, optimising personnel deployments
previous year. In fact, with demand up in all key markets, the
and providing a clearer positioning for the unit’s various outlets.
company substantially exceeded its 2003 turnover result. As well
As a result, the 90 Kuoni agencies and the three outlets of the
as specific product expansions, a new catalogue concept and
Rewi group now offer the full product ranges of both Kuoni and
modifications to the reservation system (with corresponding cost
its competitors, while the ten Helvetic Tours outlets now focus on
and time savings) were instrumental in this improvement. The
selling Kuoni Group products and air tickets. The changes will
year also brought Manta Reisen the Gold Travel Star in the new
enable Kuoni to better meet the growing demand for advisory
Long-Haul Travel Indian Ocean category.
services and complex individual travel arrangements. The proportion of total bookings made online rose to 3% in 2004. The
figure is still modest, but is expected to increase. Internet bookings are currently restricted mainly to products like flight-only
Privat Safaris, Rotunda Tours and Intens Travel
(PRZ AG): on course for success
tickets, car rentals or straightforward package arrangements
Africa (and South Africa especially) has now found renewed
(such as Reisen Netto). But the Internet was also extensively
interest among the public after several difficult years. The trend
used as an information source. With various air carriers (includ-
is due in no small part to the recent unprecedented investments
ing Swiss International Air Lines) deciding to abolish the com-
in local infrastructure and security. Kuoni subsidiaries Privat
missions they pay to accredited IATA travel agencies for their
Safaris and Rotunda Tours, which specialise in African travel,
ticket-issuing services, the agencies have been obliged to reas-
have derived particular benefit from these developments, and
sess their own service fees. As a result, Kuoni increased the fees
posted turnover for 2004 that far exceeded its prior-year equiv-
it charges for its comprehensive consultancy, reservation and
alent. Rotunda Tours also won its third Gold Travel Star from
ticket-issuing services from 1 January 2005. The service fee is
the Swiss travel sector as Best Tour Operator to Africa, with
still warranted by the added value provided for customers by
Privat Safaris following closely behind.
the agency’s booking services.
Intens Travel, the subsidiary acquired in 2003, is also on course
Edelweiss Air:
a further “best charter airline” award
for further business growth. The company, which specialises in
high-quality travel to India, reported substantial increases in both
turnover and EBITA for the year. One of the reasons for these
Edelweiss Air, Kuoni Switzerland’s charter airline subsidiary, can
improved results could well be the boom experienced in quality
look back on a positive 2004 of high load factors. The airline
tourism to India over the past few months.
carried 695 000 passengers, 16% more than the 600 000 transported in 2003, and met some 60% of Kuoni Switzerland’s
charter capacity needs, providing both the autonomy required
and the flexibility desired to respond to market trends. Edel-
Railtour Suisse:
activities expanded through ACS Reisen
weiss Air again proved a reliable operator, with an average
After 16 record years, Railtour Suisse posted its first-ever turnover
deviation from scheduled departure time of just seven minutes
result which fell short of prior-year levels. Kuoni is still firmly com-
for short-haul services and 13 minutes for long-haul flights.
mitted to rail travel as an alternative to the air travel sector. And,
Passengers also appreciated Edelweiss Air’s full inflight service
to further cement its market position, Railtour Suisse acquired a
(with catering and newspapers) at a time when most carriers
majority 67% shareholding in ACS Reisen from the Swiss Auto-
are reducing their onboard service products – as was confirmed
mobile Club in the course of 2004. ACS Reisen, whose brand is
by the Gold Travel Star which it received at the latest Travel Star
highly regarded among arts enthusiasts, is the Swiss market
Awards Night, for the fourth time in succession and with a
leader in the summer festival, opera and concert travel fields.
maximum of 300 points.
Railtour Suisse earned its second Gold Travel Star in succession
in 2004, in the City Break category.
28
Reporting
SBU Switzerland
Hellenic Tours and Hellenic Island Services:
shareholding sold
As part of a broader endeavour to enhance its portfolio, Kuoni
Travel Holding Ltd. sold its equity stake in Hellenic Tours SA
(including the latter’s majority shareholding in Hellenic Island
Services Ltd.) to general manager George Georgopoulos in the
first half of 2004. Hellenic Tours SA had been a subsidiary
of Kuoni Travel Holding Ltd. since 1974. Kuoni will continue
to work closely with all its Greek partners under a five-year
cooperation agreement.
At a glance
The Swiss tourism sector was characterised
by a fiercely contested market that showed
only marginal growth. Despite this, however, SBU Switzerland achieved increases in
both its turnover and its EBITA results and
consolidated its leading market position.
The encouraging performance was due in
particular to innovative marketing, consistent cost management and the implementation of the new retailing strategy. The
number of retail outlets was reduced from
115 to 103, and the opportunity was also
taken to eliminate locational drawbacks
and provide clearer outlet positioning. The
Kuoni brand still accounts for some 60%
of total turnover volume.
Turnover
CHF million
1000
750
500
250
0
00
01
02
03
04
01
02
03
04
EBITA
CHF million
60
45
30
15
0
00
29
SBD Leisure Travel – Switzerland &Scandinavia
SBU Scandinavia
Significant progress achieved
+++ Profiting from
the recovery
more than most +++
Kuoni brand developed further
High level of Internet use
Novair fleet renewal complete by spring 2005
With its Kuoni and Apollo brands, SBU Scandinavia has become a
on-year rise in turnover, but achieved a much higher EBITA thanks
well-established player on the Scandinavian leisure travel scene.
to cost savings. Kuoni Scandinavia focused in particular on strict
This is reflected in the fact that Kuoni Scandinavia, number three
cost management, a clear positioning in each of its three mar-
in the Scandinavian leisure travel sector, was able to profit more
kets and optimising its product portfolio during 2004. The
than most other operators from the general recovery in the
Kuoni products introduced in the long-haul sector a year before
market in 2004. Kuoni’s Scandinavian companies in Sweden,
continued to establish themselves and enjoyed growing popu-
Norway and Denmark, which employ some 664 people, were
larity. In the medium-haul business, there was particularly strong
thus able to record a further significant improvement on the
demand for destinations in Greece, Bulgaria, Tunisia, Egypt and
previous year. Turnover rose by 18.8% to CHF 595 million
Turkey, while interest in Cyprus and the Algarve stagnated.
(2003: CHF 501 million), and EBITA rose a further 82.2 % to
CHF 16.4 million. Sweden made the largest contribution to
More people use the Internet in Scandinavia than in many other
the increase in sales, exceeding its previous year’s turnover by
European markets. The willingness of Kuoni’s Scandinavian clients
33.9%, while Norway posted an even higher 40.2% improve-
to book holidays online continued to grow in the course of 2004,
ment on its 2003 figure. Denmark only managed a 7.3% year-
and now stands at some 25%. In response, Kuoni Scandinavia
has optimised its Internet presence still further and made its website even more user-friendly. The Internet will continue to be a
focus of special attention.
30
Reporting
SBU Scandinavia
At a glance
With its Kuoni and Apollo brands, Kuoni is
number three in the Scandinavian leisure
travel sector. The Group’s Scandinavian
companies derived above-average benefit
from the general market recovery in 2004.
Sweden and Norway made the biggest
contributions to the positive turnover trend.
Denmark reported more modest growth, but,
thanks to cost economies, posted a muchimproved EBITA result. Since the Internet is
particularly popular in Scandinavia, Kuoni has
further enhanced its online presence and the
user-friendliness of its website facilities. The
Internet will continue to feature strongly in
Kuoni’s Scandinavian operations.
Turnover
CHF million
The conversion of the Novair medium-haul fleet from Boeing
737 aircraft to Airbus A321s, which was begun in 2004, will be
completed in spring 2005, leading to increased efficiency. In
600
450
addition, the Kuoni brand, which was launched in Denmark in
autumn 2002 and in Norway and Sweden in August 2003, will
be built up even further this year in the Scandinavian market.
300
150
In the future, Kuoni’s Scandinavian companies also aim to concentrate more on long-haul business alongside the traditional
0
00
short- and medium-haul beach holidays.
01
02
03
04
01
02
03
04
EBITA
CHF million
50
0
–50
–100
–150
00
31
32
Reporting
SBD Leisure Travel – Europe
A clear upward trend
+++ Europe’s national
companies
continue to grow +++
France reports sizeable growth
Italy returns to profit
Netherlands and Spain strengthen their position
Unlike Scandinavia, the markets of Southern and Western
Europe experienced only moderate growth in 2004. In Central
Europe (Germany and Austria) in particular, demand for travel
remained dampened by a generally muted consumer mood.
Despite this, however, the national companies that make up
Strategic Business Division Europe with its workforce of 1 066
employees combined to post an annual result that was a clear
improvement on the previous year. Total turnover for the division
rose from CHF 488 million to CHF 597 million, an increase of
22.3 %; and, at CHF 15.3 million, EBITA was an 84.3 % improvement, or almost double the CHF 8.3 million of 2003.
France: above-average growth
Voyages Kuoni SA and Vacances Fabuleuses SA (which was
acquired the previous year) both delivered highly favourable
performances in 2004 and reported the strongest growth
within the division. The French subsidiaries, which are active
largely in the long-haul business and focus primarily on the
mid-to-high-price segment, raised their total turnover by
26.5% to CHF 302 million. The encouraging result was due in
no small part to intensive efforts on the direct marketing and
image promotion fronts. Demand was also sizeably increased
for the Emotions luxury product line, whose brochure also
earned the Prix Villégiature award for Best European Vacation
Catalogue for the second time. Kuoni France offers a broad
range of products. In addition to the Kuoni brand (in the longhaul sector), these include the specialist brands of Scanditours
(for Norway, Sweden, Finland, Iceland and Denmark), Celtic
Tours (for Ireland and Scotland), Vacances Fabuleuses (for the
USA) and Partirdiscount with its direct-sales activities. Kuoni
France further developed its range of long-haul products in
2004, adding Australia to its programme. It also introduced
greater flexibility to the tour products offered. Egypt, the USA
and Norway proved the most popular destinations, along with
Finland, Mexico and the Maldives. With a view to further con-
33
solidating its position in the quality segment, Kuoni France also
evaluated a new shop concept offering niches for “lifestyle”
activities and advice. The first pilot outlet opened in Paris in
February 2005, and the new concept will be extended to the
country’s other outlets over the next two years.
The Netherlands: good progress made
Consolidation was the main feature of the Dutch market in 2004.
In a harsh business environment, Kuoni Netherlands‘ Special
Traffic and African Holidays brands posted encouraging performances that produced an annual turnover of CHF 85 million,
a 9.0 % increase on the CHF 78 million of the previous year.
Italy: turnaround achieved
In a highly competitive market that saw strong trends towards
last-minute bookings, Kuoni Gastaldi Tours S.p.A. achieved its
corporate turnaround in 2004. The turnover of CHF 138 million
was an 11.3% improvement on the CHF 124 million of the previous year, an increase which was substantially above average
market growth in the long-haul sector. The turnover improvement owes much to the addition of the Maldives, Mauritius, the
Seychelles and China to the product range and the introduction
of the exclusive Emozioni product line. Kuoni Italy also came to
collaborate increasingly with a number of medium-sized networks for its retailing activities in the course of the year; and
further progress was made in the rebranding from Kuoni
Gastaldi to Kuoni, a process which will be concluded in 2005.
34
Higher productivity, the expansion of the Net Vacations direct
sales and continuing strict cost management all contributed to
these favourable results. Kuoni’s Dutch operations also further
increased their share of the market for key destinations such as
Cuba, the Middle East, Australia and New Zealand. As in previous years, the achievements of Kuoni Netherlands again earned
recognition within the travel sector: Special Traffic was named
Best Specialist, Best Long-Haul Operator and Best Tour Operator
to North America and the Far East at the Dutch Travel Oscars.
Buoyed by these distinctions, Kuoni Netherlands aims to make
further steady progress in 2005 in rebranding Special Traffic to
Kuoni. This process, which was initiated in 2004, is scheduled
for completion by the end of 2006. The Net Vacations direct
sales operations will also see further expansion.
Reporting
SBD Europe
Spain: intensified collaboration and a massive
turnover increase
Despite intensified competition within the Spanish market, Viajes
Kuoni SA posted a significant increase in annual turnover for 2004
– partly through its successful collaboration with the country’s El
Corte Inglés retail chain. Operating under the Kuoni and Los Viajes
Difusión de Kuoni brands, the Group’s Spanish subsidiary recorded
total turnover of CHF 36 million for the year, a 44.0% improvement on the CHF 25 million of 2003. The year also brought further improvements to the product portfolio, including the addition
of a number of Red Sea resorts, which, together with the Maldives, proved the most popular destinations. Viajes Kuoni SA
intends to further develop its retailing and customer services in
2005. To this end, the company will continue its collaboration
with El Corte Inglés and co-devise new special products.
At a glance
Having seen turnover stagnate the previous
year, SBD Europe experienced sizeable
expansion in 2004. Kuoni France was particularly successful, recording the strongest
growth within the division; Kuoni Italy
achieved its turnaround; Kuoni Netherlands
posted an encouraging performance in a
consolidating market environment; and
Kuoni Spain reported a result that was a
significant improvement on its prior-year
equivalent. The Central European leisure
travel sector felt the effects of a generally
muted consumer mood.
Percentage of turnover in 2004
Austria: an improved performance
in a weak market
In a business climate largely characterised by a modest economic recovery and fierce predatory competition in the retail
France
Germany
Austria
sector, Kuoni Austria outperformed the overall Austrian market.
Spain
Despite stagnant market growth, the Group’s Austrian opera-
51%
2%
4%
6%
14%
tions, with their Kuoni, Restplatzbörse, Golfreisen mit Schwung
and Commerz-Reisen brands, raised their annual turnover from
23%
Netherlands
Italy
the CHF 22 million of 2003 to CHF 23 million, an increase of
4.5%. Kuoni is one of Austria’s leading retailers, operating
a network of 131 outlets (18 of Kuoni’s own travel offices,
93 franchisees and 20 “Restplatzbörsen” specialising in lastminute products). Future plans include the further expansion of
the present franchisee network to consolidate Kuoni Austria’s
Turnover
CHF million
1000
750
position in the country’s retail market.
500
Germany: restructuring initiated
With the German market showing only modest growth, the new
250
0
00
Kuoni Reisen GmbH posted annual turnover of CHF 14 million.
Following the sale of the Kuoni Group’s BTI Central Europe business travel division, the company was newly assigned to Strategic Business Division Europe. The move was accompanied by the
adoption of strict cost management and various restructuring
01
02
03
04
01
02
03
04
EBITA
CHF million
20
activities that saw five of the company’s 39 offices closed and
one office sold in the course of 2004. The restructuring also
resulted in all the financial and IT support services previously
provided within this former BTI subsidiary being outsourced to
external providers.
10
0
– 10
– 20
00
35
36
Reporting
SBD Leisure Travel – United Kingdom & North America
Core competencies proven
+++ Kuoni UK performs
well; Intrav still below
expectations +++
Kuoni UK maintains high EBITA margin
Intrav falls short of expectations
Numerous industry awards
Total turnover for Strategic Business Division United Kingdom
CHF 74.9 million. The EBITA margin slipped from the 11.5% of
& North America amounted to CHF 827 million, a 9.4% improve-
2003 to 10.2%. A double-digit EBITA margin remains a unique
ment on the CHF 756 million of 2003. EBITA was down, how-
achievement in the leisure travel sector – all the more so given
ever, at CHF 63.1 million, a decline of 10.4%, owing to the still
Kuoni UK’s sizeable investments in its marketing and customer
less-than-satisfactory performance of Intrav, the division’s US
services in the first half of the year. Kuoni UK devoted consider-
subsidiary.
able time and resources to its customer services in 2004. An
exhaustive initial analysis was followed in spring by a company-
United Kingdom:
a good result in a difficult market
wide training programme. Customers were clearly very satisfied
with the first-class service that resulted from these activities,
as was evidenced by the various awards that Kuoni UK earned
In an increasingly competitive market, Strategic Business Unit
in the course of the year: the readers of the Sunday Times,
(SBU) United Kingdom again demonstrated its core competence
for instance, voted it Best Travel Company, and the UK’s travel
as a specialist in individual long-haul travel and posted a favour-
agents named it Best Long-Haul Tour Operator for the 22nd
able annual result. Kuoni’s UK subsidiary, which has a workforce
time. The year also saw a greater willingness among customers
of 498 employees, raised annual turnover from the CHF 654 mil-
to book their travel online via the www.kuoni.co.uk website. In
lion of 2003 to CHF 735 million, an increase of 12.4 %. The im-
view of this, the company will be further enhancing its Internet
provement can be ascribed to various factors, but particularly to
presence in 2005.
sizeable growth in demand for Thai destinations and the continuing popularity of the Maldives, Egypt and Sri Lanka. After a
long drought the year also brought renewed interest in Malaysia,
Kenya and Singapore, and the Delhi charter launched in midyear soon proved popular. EBITA for the unit amounted to
37
38
Independent Business Units (IBUs):
Voyages Jules Verne posts a further record result
USA: weaker than expected
The Voyages Jules Verne independent business unit delivered an
of recovering from the repercussions of 11 September 2001 and
encouraging performance in 2004, setting a further new record
the effects of the Iraq war. Despite this, the CHF 91 million turn-
with its direct sales activities. The other IBUs – Sports and
over posted by Intrav, the division’s US subsidiary, which has 132
Leisure, The Travel Collection, Incentives and Events, Student
employees, was below the CHF 98 million recorded for the pre-
Travel and the Far East Travel Centre – were restructured during
vious year. The decline can be attributed to management miscal-
the year. With online sales set as a prime business focus in 2005,
culations (such as late brochure launches). The four ships of
efforts will now be made to further enhance the customer-
Clipper Cruise Line were not used to full capacity during the
friendliness of the units’ various websites.
year. The accident to the Clipper Odyssey, which struck a rock
In 2004 the US travel market finally showed the first slow signs
Reporting
SBD United Kingdom & North America
off the Alaska coast at the end of July and only re-entered service at the beginning of October, also adversely affected results.
At a glance
The high-season loss of this capacity was felt all the more acutely
The UK market was chiefly characterised by
because Alaska – along with the Antarctic, Australia, Japan and
growing competition in the tourism and
China – is one of the favourite destinations of Kuoni’s American
e-commerce sectors. Thanks to its specialist
customers. The Intrav organisation was restructured in the
expertise in individual long-haul travel, how-
course of 2004. These activities – which included enhance-
ever, SBU United Kingdom still posted an
ments to its distribution and a concentration on strong prod-
encouraging result for the year. The US
ucts for the Intrav, Clipper Cruise Line and LifeLong Learning
travel market showed signs of gradually
brands – should ideally position the company to benefit from
recovering from the repercussions of 11 Sep-
the recovery in the travel sector in 2005. Intrav is particularly
tember 2001 and the impact of the Iraq war.
confident of doing so in view of the various awards it earned in
But, with less-than-satisfactory business
the course of 2004. These included top marks for Intrav and
development at US subsidiary Intrav, results
Clipper Cruise Line from the readers of Travel + Leisure and
fell short of expectations. A strategic reap-
Condé Nast Traveler magazines, and Clipper Cruise Line’s nam-
praisal of the company’s business is envis-
ing as the World’s Leading Small Ship Operator at the 2004
aged for 2005.
World Travel Awards in Barbados, the second time it has won
this industry distinction.
Turnover
CHF million
1000
750
500
250
0
00
01
02
03
04
01
02
03
04
EBITA
CHF million
100
75
50
25
0
00
39
40
Reporting
SBD Leisure Travel – Incoming &Asia
A quantum leap forward
+++ Incoming consolidates
its position as
world number three +++
Sizeable improvements in turnover and EBITA
Asia registers renewed growth
USA shows positive trends
After a very difficult 2003, business in the Asia-Pacific region
Incoming Services
bounced back particularly strongly in the year under review.
With risks such as SARS removed, a tangible recovery was felt in
the general economic climate. Buoyed by the trend, Strategic
Business Division Incoming & Asia reported quantum improvements in its business results. Annual turnover rose 32.5 % from
CHF 551 million to CHF 730 million. And earnings before interest, taxes and amortisation of goodwill (EBITA) jumped from
the CHF 2.6 million of 2003 to CHF 17.8 million, an almost
sevenfold increase year-on-year. These results place Kuoni Incoming as one of the world’s three biggest inbound operators
and the number one in the Swiss market. The division has
2 589 personnel.
Incoming Services Europe: sizeable growth
Incoming Services Europe, which has 13 European destination
management companies and 17 sales offices in Asia and numbers 485 staff, derived above-average benefit from the upturn
in the Asia-Pacific market, and in the markets of origin of Japan
and China in particular. In addition to the improvement in overall economic conditions, strict cost management, intensified
sales activities and rises in demand for MICE (meetings, incentives, congresses and events) products and the individual (FIT)
travel products launched in the course of the year all had a positive effect on business trends and results. While US citizens
remained hesitant to venture abroad, Japanese, Indian and
above all Chinese travellers seemed all the keener to do so.
With the Approved Destination Status (ADS) introduced on
1 September 2004, Chinese nationals can now travel as tourists
to Switzerland and to those countries which are signatory to the
Schengen Agreement. The new provisions also permit licensed
tour operators to actively promote tourism in the Chinese market. In view of these developments, Incoming Services Europe
expects a further substantial increase in the numbers of Chinese
visitors in 2005, a year in which the unit also aims to intensify its
focus on MICE and individual travel products.
41
Private Safaris Africa: ground gained
Kenya has regained sizeable appeal as a tourist destination, and
the market currently shows impressive growth rates. Kuoni’s Pri-
Asia
India: return to success
vate Safaris East Africa Ltd. subsidiary, which employs just over
The Indian travel and tourism market is currently seeing strong
160 personnel, benefited especially strongly from the trend. The
growth. In this flourishing business environment, Kuoni Travel
restructuring effected in the Nairobi and Mombasa offices under
(India) Ltd. and its 1 569 employees further consolidated their
the new management team also made its contribution to the
leading market position. With annual turnover of CHF 146 mil-
favourable business performance. Cape Town-based subsidiary
lion, Kuoni’s Indian subsidiary achieved a 50.5 % improvement
Kuoni Private Safaris Ltd., which was founded in 2003 and
on the CHF 97 million of the previous year, benefiting from the
employs 28 personnel, also reported an improved result, and
buoyant market throughout its product range. The outbound
additionally acquired new overseas customer groups. 2005
segment reported highly positive trends. The focus here in 2004
should bring further progress in the development of Incoming
was on expanding the range of leisure travel products for indi-
Services Private Safaris Africa, more expansion of the range of
vidual and special-interest travellers. As a result, the Christo-
tailor-made safari products offered and the winning of further
pher Columbus brand is now firmly established in the individual
customer segments in the Asian and North American markets.
tourism market. Further developments included the addition of
destinations such as Egypt, Russia and China. Egypt in particu-
AlliedTPro USA: recovery under way
The USA returned to favour as a vacation destination in 2004,
The company’s inbound business saw renewed growth in
compared to the previous years. The trend had a correspond-
2004 after two difficult years resulting especially from the
ingly positive impact on results at Kuoni subsidiary Incoming
repercussions of 11 September 2001 and the conflict on the
Services AlliedTPro USA, the number one in the US incoming
Indian-Pakistani border. SITA was successfully positioned as an
sector. The weak dollar and the resulting lower travel costs for
umbrella brand for all inbound activities; and all incoming units
visitors from Europe and Asia had their own favourable influ-
moved to Delhi into the new SITA building at the end of May.
ence on the destination’s popularity. But the attractive prices
The business travel unit operating under the BTI brand gained
offered by AlliedTPro, the tapping of new customer markets
further market share as well; and improved results were also
(like Germany and Australia) and the expansion of existing
seen at Visa Facilitation Services, which is commissioned by
customer segments (such as Latin America) also played their
various foreign embassies to handle their visa affairs. As in pre-
part in the improved result. AlliedTPro began to introduce a
vious years, Kuoni India earned numerous distinctions in the
new operating system developed by its Canadian partner
course of 2004. The outbound unit collected the Airline Award
Jonview in the course of 2004. The new system is designed to
and the Star Cruises Award, while the inbound unit was hon-
further raise operating efficiency. In connection with this, the
oured with the prestigious Government of India’s National
Canadian office was transferred to Jonview’s operation. For
Tourism Award and three Galileo Express Travel & Tourism
2005, AlliedTPro intends to further intensify the cultivation of
Awards. With the Indian economy showing impressive further
its customer markets in the Asia-Pacific region and in Latin
growth potential, future prospects are also bright for the
America. The company also aims to expand its product and
country’s tourism sector.
service ranges in the MICE and individual travel fields, to
ensure that it can continue to win new customers in the higher
price segments.
42
lar rapidly attracted strong customer interest.
Reporting
SBD Incoming & Asia
Hong Kong: ground recovered
The Hong Kong market reported substantial growth rates for
2004 and a comeback that offset the declines of the previous
few years. Kuoni’s P&O Travel Hong Kong subsidiary felt the
benefit of this explosive growth. Turnover for the year totalled
CHF 53 million, a 35.9 % improvement on the CHF 39 million
of 2003. In its endeavours to serve as the Kuoni Group’s gateway to China, P&O Travel Hong Kong Ltd. expanded its activities in Southern China and also opened four new Hong Kong
offices. Since the rights to the P&O Travel Hong Kong Ltd.
name and brand will expire in 2005, the company will be
renamed Kuoni Travel (China) Ltd. in spring 2005, and will then
operate under the Sky Travel (“Sing King Yao” in Chinese)
product brand.
At a glance
SBD Incoming & Asia experienced a quantum
leap in results in 2004, posting substantial
increases in both turnover and EBITA for the
year. Incoming Services Europe derived
especially strong benefit from the upswing
in the Asia-Pacific market. Results for Private
Safaris Africa were buoyed by both market
growth and the restructuring actions
effected. At AlliedTPro, the relative weakness of the US dollar had a positive effect
on the vacation preferences of European
and Asian travellers. And Kuoni India
and Hong Kong further consolidated their
market positions.
Turnover
CHF million
800
600
400
200
0
00
01
02
03
04
01
02
03
04
EBITA
CHF million
20
15
10
5
0
00
43
44
45
46
Market environment
SBD Business Travel
Back on track for growth
+++ Strong expansion
in the global
tourism sector +++
Boom in the Asia-Pacific region
Trend towards individualised travel arrangements
Growing importance of advisory skills
After three years of hesitant development, the international
The top ten European travel corporations
tourism sector saw renewed rapid growth in 2004. According
(annual turnover estimates in CHF billion at the beginning of 20051)
to the World Tourism Barometer, the number of international
trips taken reached a new record high of 760 million – a 10%
0
TUI Group (D)2
increase on the previous year.
The Asia-Pacific and Middle East markets of origin witnessed a
Thomas Cook (D)
genuine boom in business, reporting year-on-year growth of
29% and 20% respectively. Double-digit increases were also
20.5
19.7
7.7
7.9
REWE Touristik (D)
7.3
6.8
First Choice (UK)
5.5
5.1
Grupo Iberostar (ES)3
3.8
3.4
growth, as the World Tourism Organization (WTO) confirms.
Kuoni (CH)
3.6
3.3
Relatively modest growth was reported in traditional European
Club Med (F)
2.6
2.5
Alltours Group (D)
2.0
1.9
Hotelplan (CH)
1.8
1.7
and Europe (+ 4%) posted more modest trends; but these
regions, too, experienced growth rates that were substantially
above those that had been seen in previous years.
The impressive increase in travel volumes in Asia can be attributed to the end of the SARS epidemic, which had severely
dampened demand in the region the previous year. The revival
10
15
20
25
2004
2003
11.7
11.2
MyTravel (UK)
recorded for North and South America (+10%). Africa (+7%)
5
of the global economy proved a further engine for overall
destinations such as Western Europe (+2%) and Southern and
Central Europe (+3%). Eastern Europe (+ 8%) and Scandinavia
(+7%), by contrast, benefited from the trend towards new and
less-well-trodden tourist paths. “Old Europe” also faced rising
competition from other nearby non-euro destinations: Egypt,
Morocco and Tunisia all posted double-digit growth.
1
Turnover figures are only comparable to a limited degree, since Europe’s travel corporations
have different accounting principles and business years.
Travel and tourism business only.
3
Unconsolidated.
2
47
European travel corporations return to growth
More individuality and more advice
The brighter business trends were felt throughout Europe’s
According to the experts, value and social considerations are
major tour operators. The German-based corporations posted
expected to change the travel market most in the years ahead.
particularly strong growth. TUI (+ 4%*) remained the clear mar-
“The reluctance to travel after the latest negative events has
ket leader; but Thomas Cook (+ 4%*), Rewe Touristik (+ 8%*)
prompted many people to redefine their personal behaviour
*
48
and Alltours Group (+ 4% ) all reported higher turnover than
and lifestyle,” says Vincent A. Wolfington, chairman of the
a year before. Kuoni (+ 9%) was also among the clear winners,
World Travel & Tourism Council. “And this, together with demo-
as was UK-based First Choice (+ 8%*) and – to a lesser extent –
graphic shifts, will be the prime factor in the changes in demand
Club Med of France (+3%*). The sole member of the ten biggest
that we will see in the travel market over the next few years.”
European travel corporations to sustain a turnover decline in
The specialists distinguish five trends here: the selfness trend, the
2004 was MyTravel of the UK. The top ten itself saw no
experience trend, the intimacy trend, the luxury trend and the
changes in order: TUI Group and Thomas Cook of Germany
technology trend. The selfness trend reflects the desire of peo-
remain in first and second place, followed by MyTravel (UK),
ple today to return to what does them good. This can be seen
Rewe Touristik (Germany) and First Choice (UK).
in the growing numbers of wellness products and educational
* Based on annual turnover estimates at the beginning of 2005.
opportunities at the destination.
Market environment
Closely linked to the selfness trend is the growing importance
The fifth trend is generally referred to as the technology trend.
of the “experience” factor in any leisure or vacation activity.
Travel blogs – specialist websites on which people can place
While people in the past have tended to seek as many necessarily
their own travel diaries – are becoming an increasingly reliable
brief vacation experiences as possible, more and more vacation-
source of genuine travel tips, especially for younger genera-
ers are coming to prefer more intense experiences that can
tions. The number of these blogs is rising rapidly, as is the
create or encourage personal change. This experience trend has
frequency with which they are used. While most of the sites to
various manifestations. Some specialist operators now offer
date have been in English, more and more travel blogs are now
travel products providing authentic experiences in a foreign
appearing in other languages, and in German in particular.
culture, landscape or natural setting, with a firm focus on the
guest’s desire for adventure. It is also reflected in the rapidly-
And what does the rise of these trends mean for the tourism
growing popularity of cruise products – especially themed
sector? It means that simple products such as flight-only travel
cruises, where the time aboard is spent learning about cooking,
will steadily disappear from the range of products offered by
wine, fashion or other lifestyle issues.
travel agents (as they come increasingly to be booked online),
while more individualised products will come to demand more
The third trend – towards intimacy – puts the accent on a more
intensive advisory services. The travel agency will continue to
introspective and intense vacation experience. This trend is
sell emotions, but will gradually be transformed into a centre
expressed in the growing demand for special, more “intimate”
for travel and vacation advice. So the agency of tomorrow will
locations at which like-minded vacationers can meet up, such
have extensive advisory skills and a growing range of individ-
as exclusive private islands that can be rented with family or
ualised travel services.
friends. Club vacations and ashram holidays are also part of the
intimacy trend, as is the renewed interest in more basic and
often remote accommodations such as dachas and mountain
huts. This is a trend that has so far been largely exploited by
niche market operators.
The Internet:
an information and transaction platform
With information and communications technology continuing
to develop at a rapid pace, not only have customers never been
The fourth trend – towards luxury – can be seen in an extensive
better informed than they are today; they are also increasingly
awareness and appreciation of exclusivity, excellent service and
willing to perform certain functions – such as obtaining infor-
special attention to individual wishes and needs. At the heart of
mation or even booking their travel – themselves. The Internet
this trend is a new notion of luxury that is based on high service
has already become the prime source of information for pre-
quality and unusual experiences, such as the underwater hotels
paring a trip in a number of countries. And simple products can
now being developed in the Bahamas and in Dubai.
now be booked online, too, with relative ease. What customers
want today is a user-friendly, well-functioning and appealinglypresented website that enables them to compile their own individual travel arrangement.
49
50
51
52
Responsibility
Personnel
Standards unified around the world
+++ Staff satisfaction
essential to an
innovative approach +++
Diversity Policy defined
Targeted promotions of individual skills
Firm focus on a healthy work-life balance
The Kuoni Group had a total worldwide workforce of 6 719
employees on 31 December 2004, around 5% or 294 employees
more than at the end of the previous year. The proportion of
women in management remains encouragingly high: women
currently occupy 50% of all middle and lower management positions; and in upper management (including the Group Management Board), the proportion is no less than 18%.
The consistent expansion of the Corporate Human Resources
unit was a prime focus of activity in 2004. The work here extended to an analysis and revision of all the processes involved.
Various new guidelines were also defined in the course of the
year including a Diversity Policy and a Training & Development
Policy, which will help facilitate collaboration between employees from different cultures and ensure the fair and equal treatment of all personnel throughout the Kuoni Group. The business
units are provided with full Corporate Human Resources support
when implementing the new standards.
Employees from over 60 nations
Ensuring effective collaboration among people of so many different cultures, tongues, religions and customs is a challenge
that calls for openness, spontaneity and a dash of idealism, too.
And it is to address this vast range of cultures and backgrounds
that the Group established its new Diversity@Kuoni principles in
2004. As the world steadily grows together, customer needs are
changing. And products and services are constantly modified
in line with these shifting requirements. In this respect, Kuoni
intends its Diversity Policy to enhance the potential for ideas
and innovations and thus further improve the Group’s competitiveness: teams drawn from a wide range of backgrounds can
approach a task from various perspectives and thus achieve
higher productivity and devise better solutions. Kuoni’s endeavours on the diversity front are also intended to further enhance
the working environment which it offers its employees. After
all, new energies can be released through an effective blend of
meeting personal and professional needs.
53
Structured training
2004 further saw the devising and adoption of a Training &
Development Policy for the entire Kuoni Group. The new policy
is designed to establish a groupwide understanding and
appreciation of training and development, to define the concepts and emphases of the Group’s training policy and to
specify the corresponding responsibilities. In introducing its
new Training & Development Policy, the Kuoni Group is underlining the importance it attaches to its initial and in-service
training activities, and is stressing the key role played by training in the personal development of each individual employee.
Kuoni has also established a series of process descriptions,
guides and “toolboxes” to support the adoption of the new
54
policy within its local companies. The toolboxes, which include
forms, examples, concepts and whole training modules with
exercises, should help the Kuoni Group’s national companies
adopt the new policy and pass on the knowledge available
in adequate form. Extensive efforts will be made to further
develop these tools in 2005, to provide optimum assistance
and support for the local Human Resources organisations.
Employee satisfaction and retention
Retention, for the Kuoni Group, is not merely a matter of keep-
Further development of Management Survey
initiatives
ing its employees. It also means ensuring that they continue to
The findings of the Management Survey conducted at the end
identify with the company and their work. In service companies
of the previous year were used to take a number of corrective
in particular, satisfied and motivated employees can provide a
actions in the course of 2004. These included intensifying both
vital competitive edge. Kuoni is also committed to ensuring that
international communications and the exchange of knowledge
its employees can maintain a healthy balance between their
and experience within the Kuoni Group. Various electronic
working duties and their private interests. To this end, the
extranet platforms have now been established to permit struc-
Kuoni Group encourages the adoption of individual workhours
tured intragroup communications. They have proved extremely
models wherever these are feasible and can be reconciled with
popular, and are already widely used. These technical tools
its business needs.
have also been supplemented by numerous knowledge workshops held throughout the Kuoni organisation. In November
2004, for instance, some 60 destination managers, product
Employees working part-time
managers and purchasers met in Vienna to intensify their
exchange of information and expertise and to pass on their
Switzerland
35.6%
experiences in the “best practice” field. Further knowledge
Scandinavia
17.1%
workshops will be held in 2005.
Europe
18.1%
United Kingdom & North America
9.1%
Incoming & Asia
11.0%
Corporate
12.0%
Kuoni Group
18.4%
Structured and targeted training benefits employees all over the world.
55
The environment
Ecologically aware tourism encouraged and promoted
+++ Respect for the
environment is a key
Kuoni value +++
Subsidiaries active
Second Environmental Report published
Environmental network established
The Kuoni Group worked intensively on further improving the
Almost all the Kuoni Group’s business units already advise their
ecological sustainability of its activities in 2004. A milestone was
customers before and during their trip on how they can be eco-
achieved in the corporate ecology field with the creation of
logically and socially minded in their actions and behaviour. These
groupwide Guiding Environmental Principles. The Group’s nation-
customer briefings, which also draw attention to the concerns of
al companies were active, too: Kuoni Switzerland published its
the local population, will be extended to all national companies
second Environmental Report and held two “Eco-Weeks” – on
in the course of 2005.
“Mobility” (in spring) and “Saving on Resources” (in autumn), the
latter with a special focus on energy consumption and paper recycling. Kuoni Netherlands was another active national company,
The Green Planet Award
publishing its first-ever Environmental Report. The Group’s Dutch
The service partners, agents and hoteliers who work with Kuoni
subsidiary also laid the groundwork for ISO 14001 certification, a
are also urged to meet its ecological expectations. Kuoni Switzer-
distinction that Kuoni Switzerland had become the first tour op-
land bestows its own seal of approval on hotels and cruise
erator to earn in 2003. Kuoni UK, meanwhile, developed a system
vessels every two years through its Green Planet Award. The
enabling customers to order individual pages of its catalogues
award is based on a detailed questionnaire covering quantitative
online. Customers then receive these pages by e-mail, leading to
issues such as energy and water consumption and waste vol-
sizeable savings in paper consumption.
umes as well as qualitative criteria such as guest information and
in-house training activities. Some 82 operations have earned the
A corporate ecology network
Each recipient is duly credited with the award in the various
Every one of the Kuoni Group’s subsidiaries and national com-
Kuoni catalogues. Kuoni’s Dutch and Scandinavian subsidiaries
panies was asked to designate its own Environmental Affairs
also work with environmental checklists when negotiating with
Officer in 2004. This global network of contacts is primarily
service providers and selecting hotels. And the Group’s two
tasked with introducing the groupwide Guiding Environmental
airlines – Swiss-based Edelweiss Air and Swedish-based Novair –
Principles in Kuoni’s markets. This in turn should sensitise staff
are fully included in its overall environmental policy.
throughout the Group and ensure that environmental issues
feature more prominently in training activities.
56
Green Planet Award since it was launched in summer 2000.
Responsibility
Social commitment
The Kuoni Group is active both in the social field and in efforts
to protect the world’s fauna and flora, financially supporting
numerous projects in various countries. In addition to its global
partnership with SOS Children’s Villages International, Kuoni
Scandinavia (through Apollo) was one of the first signatories to
the Code of Conduct of UNICEF and ECPAT, a network of organisations and individuals dedicated to fighting the sexual exploitation of children. And Kuoni UK works closely with Born Free,
which is active in animal protection and environmental education.
Kuoni attaches great value to maintaining high
ecological standards, and regularly assumes a pioneering role
on environmental issues and concerns.
The Guiding Environmental Principles of the Kuoni Group
• We are committed to sustainable and environmentally minded tourism in all areas of our business and activities.
• We aim to effect continuous improvements in our performance by adopting socially and ecologically minded practices.
• We strive to bear our own environmental costs in accordance with the “polluter pays” principle.
• We conclude worldwide partnerships and practise global solidarity to jointly ensure the sustainability of all development activities.
• We place people centrestage in all our endeavours, and believe that all people have the right to a healthy and productive life lived
in harmony with nature.
• We endeavour to keep the environmental impact of the production, use and disposal of goods and the provision of services to an
absolute minimum.
• We sensitise our partners and suppliers to our Guiding Environmental Principles and encourage them to abide by the same.
• We systematically sensitise, motivate and train our personnel in environmental issues and concerns.
• We regularly inform our management, our shareholders, our staff and the public about the success of our endeavours to protect
the environment and about our overall ecological performance.
57
Social commitment
Our children are our future
+++ The children of
today are the leaders
of tomorrow +++
Children provided with a family and a home
A new start offered in life
Tolerance towards and interest in other cultures promoted
The Kuoni Group provides local help
As an international tour operator, Kuoni is in daily contact with
countries all over the world. Indeed, the sheer variety of landscapes, peoples and cultures is part and parcel of the goods we
offer. Our travel products make dreams come true, taking our
guests to exciting cities, remote regions, pristine beaches and
wild mountain peaks. And bringing people of different cultures
together is an essential part of our business activities. Time and
again, however, our meetings with people from all parts of the
world also show us the darker sides of our planet. In view of
this, and of our conviction that our work can also contribute to
their development, we also strive to provide our partner countries with humanitarian support. Good schools and training
facilities for children and teenagers, or the opportunity to simply work and thereby feed the family: these should all be givens
for people all over the world. And the partnership it has forged
with SOS Children’s Villages International enables Kuoni to provide direct local assistance and support.
58
SOS Children’s Villages International, the world’s biggest private children’s charity, supports children who cannot be raised
in their parents’ care. The organisation, which was founded in
1949, believes that children should grow up in their home
country and culture. In the last 55 years, it has opened over
440 children’s villages and 330 youth facilities providing care
for some 54 000 children in 131 countries. Each village consists
of numerous houses, each occupied by a house mother and her
“family” of children, enabling the youngsters to grow up in as
much of a family atmosphere and structure as possible.
Kuoni supports SOS Children’s Villages International with an
annual financial donation, and provides further funds from the
proceeds of various activities organised by its staff. Kuoni also
conveys the SOS Children’s Villages message to its destinations,
alerts guests to local needs and sensitises them to local habits
and customs. This reciprocal exchange leads to more tolerance
towards and greater interest in other cultures, and helps break
down prejudices and preconceptions.
Over the past few years, Kuoni has financed three houses in
SOS Children’s Villages: one each in Los Mina (Dominican
Republic), Umtata (South Africa) and Gopalpur (India). Kuoni
has also been involved in smaller projects, such as buying
books for the Village library in Zanzibar or delivering refrigerators to Mauritius. The school and technical training centre
in Nairobi (Kenya) has also twice received Kuoni funds; and
a playbus with toys has been provided for street children
Kuoni Switzerland supports Swiss sports talent
At a national level, Kuoni Switzerland is also involved in
the country’s “Sporthilfe” foundation. Sporthilfe supports
and promotes talented young sportspeople in close collaboration with their families, the Swiss Olympic association and
the various sports federations. Under its aegis, some
500 young athletes display their skills in over 30 projects a
in Romania.
By supporting SOS Children’s Villages International,
we want to offer our own contribution to making the world
a better place for children to grow up in.
The world’s children are its future. One day they will travel the
year. Sporthilfe fulfils a vital social role in Switzerland; and
globe, making their own valuable cultural exchanges. Kuoni
here, too, Kuoni is proud to make its contribution to such
aims to provide these generations, too, with the chance to visit
valuable work.
exotic destinations. By teaming up with SOS Children’s Villages
International, we want to offer our own modest contribution to
Further information on SOS Children’s Villages International
making the world a better place for children to grow up in.
and on the Sporthilfe foundation (in French and German) is
available online at www.sos-childrensvillages.org and
www.sporthilfe.ch.
59
A Kuoni glossary
An A to Z of the travel world
ACS Reisen Switzerland’s leading tour operator in the arts and music travel field,
in which (¡) Railtour Suisse acquired a majority 67% shareholding in 2004.
ADS Approved Destination Status. A new concept introduced on 1 September
2004 under an agreement signed by China, Switzerland and the European Union’s
Schengen countries permitting Chinese nationals to visit these countries for leisure
travel purposes. ADS also allows licensed travel organisations to actively promote
tourism in China.
African Holidays The East and South African tour brand of tour operator Travel
Keys BV, which was acquired by Kuoni Netherlands’ (¡) Special Traffic subsidiary
in 2001.
Agent An independent travel agency that sells Kuoni products. The term is also
used for companies acting as handling agents at Kuoni destinations.
AlliedTPro Inc. A company formed through the merger of US-based Allied Tours
LLC, which was acquired by the Kuoni Group in 2002, and New York-based T PRO,
the then number three in the US incoming sector. The new merged company is
number one in the North American incoming market.
Alternative distribution The direct distribution of travel products by a tour
operator via channels such as the Internet, interactive television or call centres.
Apollo A Swedish tour operator focusing on the mid-price segment which is also
active in Denmark and Norway and is a wholly owned subsidiary of the Kuoni
Group. Also operates its own charter airline, (¡) Novair, and is a leading Internet
travel provider.
Best Long-Haul Tour Operator A distinction bestowed on Kuoni UK at the British Travel Awards.
Best Travel Company An award made to Kuoni UK by the Sunday Times Travel
Magazine.
Budget carrier A type of airline whose tickets can often only be booked online
(¡ low-cost carrier) and which generally offers no inflight service or only against
payment (¡ no-frills airline).
ECPAT A network of organisations and individuals dedicated to fighting the
sexual exploitation of children.
Edelweiss Air A Swiss-based charter airline and a subsidiary of the Kuoni Group.
The aircraft fleet comprises three Airbus A320-200s and one Airbus A330-200 for
long-haul operations.
FIT Foreign individual traveller. A person (or group of two or three persons travelling together) visiting a destination independently, i.e. not with a (¡) package
holiday arrangement.
Golfreisen mit Schwung An Austrian-based golfing holiday specialist acquired
in 2003.
Green Planet Award An award conferred by Kuoni Switzerland on beach resort
hotels and cruise ships in the Mediterranean and the long-haul sector which have
strong ecological credentials. Their environmental performance is assessed in
terms of their energy consumption, waste disposal and waste water management
and their use of water resources.
Hellenic Island Services Kuoni’s handling agent on several Greek holiday
islands, which is majority-owned by (¡) Hellenic Tours. The company was sold
in 2004.
Hellenic Tours SA Kuoni’s Athens-based subsidiary, active in the (¡) incoming
and business travel markets. The company was sold in 2004.
Helvetic Tours A travel agency chain and Kuoni Switzerland’s budget holiday
brand.
IBU Independent business units of Kuoni UK, each of which is active in its own
niche market.
Clipper Cruise Line A cruise line with four ships run by (¡) Intrav.
Incoming Services A Strategic Business Unit (¡) (SBU) which provides management services at holiday destinations. Incoming Services consists of three
departments: Incoming Services Europe (with headquarters in Zurich, various
(¡) destination management companies in Europe and sales offices in Asia),
(¡) Private Safaris (two subsidiaries domiciled in Cape Town and Nairobi, the latter
with a branch office in Mombasa) and (¡) AlliedTPro (with its head office in
New York and further offices in Los Angeles, Miami, Orlando and Hawaii).
Condé Nast Traveler Award A distinction bestowed on (¡) Intrav’s (¡) Clipper
Cruise Line subsidiary for operating “The Best Cruise Ships in the World”.
Intrav Inc. A US-based subsidiary acquired in 1999 which specialises in exclusive
cruises, luxury safaris and holidays by private jet.
Destination management Professional tourist services based on wide experience
and extensive local knowledge which are offered to Kuoni customers from the
moment they arrive to the moment they depart, including assistance and advice,
transportation, excursions, tours, special events (corporate incentives, seminars,
congresses, sports meetings etc.) and a wide range of further activities.
ISO 14001 Internationally-acknowledged environmental certification, which
Kuoni became the first-ever tour operator to obtain in autumn 2003.
Charter The assumption of all the capacity of an aircraft (full charter) or part of
the capacity available (partial charter) by a tour operator at its own commercial
risk. The Kuoni Group owns two charter airlines, (¡) Edelweiss Air in Switzerland
and (¡) Novair in Scandinavia.
60
Diversity@Kuoni A set of global principles devised and approved in 2004 to
pay due and full regard to the various aspects of the cultural diversity within the
Kuoni Group.
Kuoni and Hugentobler Foundation Principal shareholder of Kuoni Travel Holding Ltd. in terms of voting rights (25% of voting rights, 6.25% of share capital).
A Kuoni glossary
Kuoni Gastaldi Tours S.p.A. The Kuoni Group’s Italian subsidiary, which is based
in Genoa and was created by the merger of Gastaldi Tours and Kuoni Viaggi in
1998. Kuoni Gastaldi Tours is Italy’s premier long-haul travel company. Kuoni
acquired the remaining 45% of the former joint venture in 2001 and is now sole
owner of the company.
Retailing Offering advice on and selling leisure and business travel to customers.
Kuoni Travel Holding Ltd. The holding company of the Kuoni Group.
Service provider Any provider of services for travellers such as an airline, a hotel
or a restaurant. Often referred to as ‘suppliers’ by tour operators.
Kuoni Travel (India) Pvt. Ltd. An India-based tour operator whose acquisition in
1996 made the Kuoni Group India’s biggest operator of package holidays abroad
under the (¡) SOTC brand. The Kuoni Group also acquired India-based (¡) SITA
World Travel in spring 2000 and incoming specialist (¡) Tour Club in summer 2001.
Low-cost carrier A type of (¡) budget carrier whose tickets can often only be
booked online. See also (¡) no-frills carrier.
Manta Reisen AG A Swiss-based subsidiary of the Kuoni Group specialising in
holidays to the Maldives and diving vacations.
MICE travel Travel products connected with meetings, incentives, congresses
and events.
No-frills airline A type of (¡) budget carrier which generally offers no inflight
service or only against payment. See also (¡) low-cost carrier.
Novair Kuoni Scandinavia’s charter airline, which operates three Boeing
737-800s and two Airbus A330-200s.
Package holiday A combination of holiday products and services (flight, hotel,
transfers, local assistance etc.) offered at a pre-determined all-in price.
P&O Travel Hong Kong Ltd. A Hong Kong-based Kuoni Group subsidiary
(wholly owned since August 2003) which is active in the (¡) tour operating and
(¡) incoming services fields.
Private Safaris Kuoni Group subsidiaries based in Nairobi (Private Safaris East
Africa Ltd.) and Cape Town (Kuoni Private Safaris Pty. Ltd.) which provide services
for European and overseas visitors to Kenya and South Africa respectively.
Prix Villégiature An award for the “Best European Vacation Catalogue” which
was won by Kuoni France for its Emotions product documentation.
PRZ AG A Swiss-based Kuoni Group subsidiary comprising East Africa specialist
Privat Safaris, Southern Africa specialist Rotunda Tours and India specialist
Intens Travel.
SBD Strategic Business Division: the prime units into which the Kuoni Group is
organised for management and financial reporting purposes.
SBU Strategic Business Unit: the prime sub-unit within an (¡) SBD.
SITA World Travel India’s biggest travel company, based in Delhi and acquired by
Kuoni in April 2000. Merged with (¡) Kuoni Travel (India) in autumn 2000 to create
India’s leading company in the leisure travel, business travel and incoming fields.
SOS Children’s Villages International The world’s biggest private children’s
charity, of which Kuoni has been a partner since 1997. The organisation provides
a permanent home for orphans and other children in need and prepares them for
a self-sufficient future.
SOTC The brand used by (¡) Kuoni Travel (India) for leisure travel abroad. Number
one in India for outbound and domestic tourism.
Special Traffic A Dutch-based subsidiary of the Kuoni Group which is active in
the long-haul travel market.
Tour Club An Indian incoming specialist which was acquired by (¡) Kuoni Travel
(India) in July 2001.
Tour operating Selecting and buying-in products and services and combining
them into package holidays or tailored travel arrangements.
Travel + Leisure Award A distinction earned by (¡) Intrav as a “Top-Ten Tour
Operator”.
UNICEF The United Nations Children’s Fund. UNICEF collaborates with (¡) ECPAT
on certain projects.
Vacances Fabuleuses SA France’s leading specialist for US holidays, acquired
by Kuoni in summer 2003.
Vertical integration The extension of business activities throughout the valueadding chain within the same industry, e.g. a tour operator acquiring its own
hotels, airlines, car rental companies and similar.
VFS Fastrack Visa Facilitation Services, a subsidiary of Kuoni India that processes
visa applications on behalf of foreign embassies.
Railtour Suisse SA A Swiss rail travel operator, majority-owned by the Kuoni
Group since 1994.
Voyages Jules Verne A British-based tour operator offering top-quality tours
and beach holidays via direct sales channels.
Reisen Netto Kuoni Switzerland’s direct retailing brand, which offers ‘net’ prices
with no supplements. Airport taxes, visa charges and cancellation insurance are all
included in the price. The company’s products range from beach holidays to city
breaks and tours.
World Travel Award Kuoni was named the “World’s Leading Tour Operator”
in the World Travel Awards for the sixth time in succession in December 2004.
(¡) Intrav’s (¡) Clipper Cruise Line subsidiary was also named “World’s Leading
Small Ship Operator” in the 2004 awards.
Restplatzbörse Ges.m.b.H. An Austrian-based Kuoni subsidiary offering
last-minute travel products.
61
Addresses
A worldwide presence
Kuoni Travel Holding Ltd.
Kuoni Travel Holding Ltd.
Neue Hard 7
CH-8010 Zurich
Phone +41 44 277 44 44
Fax
+41 44 271 52 82
E-mail [email protected]
www.kuoni.com
Countries are listed alphabetically, as are the
companies within each country.
Austria
Reisebüro Kuoni Ges.m.b.H.
Dr. Gunther Hölbl (Managing Director)
Modecenterstrasse 16
AT-1030 Vienna
Phone +43 1 22 730 401
Fax
+43 1 22 730 409
www.kuoni.at
www.golftravel.at
Restplatzbörse Ges.m.b.H.
Paul Kothbauer (Managing Director)
Mariahilferstrasse 77
AT-1060 Vienna
Phone +43 1 58085
Fax
+43 1 58085 995
www.restplatzboerse.at
China
P&O Travel Ltd.
Dane Kondic (Managing Director)
Suite 1701, Tower 2
The Gateway
25 Canton Road
Tsim Sha Tsui, Kowloon
HK-Hong Kong
Phone +852 2956 6888
Fax
+852 2956 6789
www.pandotravel.com
Denmark
Jan Lockhart (Country Manager)
Nørrebrogade 10
DK-2200 Copenhagen
Phone +45 35 20 10 00
Fax
+45 35 20 10 09
www.kuoni.dk
62
France
Voyages Kuoni SA
Vacances Fabuleuses SA
Emmanuel Foiry (Managing Director)
95, rue d’Amsterdam
FR-75008 Paris
Phone +33 1 42 85 71 22
Fax
+33 1 42 80 41 85
www.kuoni.fr
Germany
Kuoni Reisen GmbH
Walter Worbs (Managing Director)
Baierbrunner Strasse 39
DE-81379 Munich
Phone +49 89 710 901 10
Fax
+49 89 710 901 11
www.kuoni.de
Indian Subcontinent & Middle East
Kuoni Travel (India) Pvt. Ltd.
Ranjit Malkani (Managing Director)
Kuoni House
Colaba
IN-Mumbai 400 001
Phone +91 22 5656 2000
Fax
+91 22 5656 2009
www.kuoniindia.com
Italy
Kuoni Gastaldi Tours S.p.A.
Daniel Ponzo (Managing Director)
Mura di Santa Chiara 1
IT-16128 Genoa
Phone +39 010 5968 1
Fax
+39 010 5968 589
www.kuonigastaldi.it
Kenya
Private Safaris East Africa Ltd.
Thomas Goosmann (Managing Director)
Twinstar Tower
Mombasa Road
P.O. Box 45205
KE-Nairobi
Phone +254 20 53 06 01 / 554150 / 533998
Fax
+254 20 53 38 54 / 543438
www.privatesafaris.co.ke
Netherlands
African Holidays
Travel Keys BV
Arjan Kastelein (Branch Manager
Kalverstraat 3
NL-1971 BS Ijmuiden
Phone +31 255 545 915
Fax
+31 255 545 910
www.africanholidays.nl
Special Traffic
Kuoni Travel Nederland BV
Norbert Good (Managing Director
Entrada 211–214
NL-1096 EE Amsterdam
Phone +31 20 398 92 92
Fax
+31 20 398 92 02
www.specialtraffic.nl
Norway
Leo Berbu (Sales & Marketing Director
Grensen 3
NO-0159 Oslo
Phone +47 23 21 3000
Fax
+47 23 21 3001
www.kuoni.no
South Africa
Kuoni Private Safaris Pty. Ltd.
Frank Glettenberg (Brand Manager
Waterford House
P.O. Box 350, Century City 7446
ZA-Cape Town
Phone +27 21 528 22 00
Fax
+27 21 528 22 90
www.privatesafaris.com
Spain
Viajes Kuoni SA
Carlos Manuel Lopez (General Manager
Paseo Infanta Isabel, 17
ES-28014 Madrid
Phone +34 91 538 27 00
Fax
+34 91 538 27 27
www.kuoni.es
Sweden
Fons Brusselmans (Managing Director
Seavägen 155, 9th floor
SE-11346 Stockholm
Phone +46 8 673 84 00
Fax
+46 8 673 85 08
www.apollo.se
www.kuoni.se
Addresses
Switzerland
Edelweiss Air Ltd.
Karl Kistler (Managing Director)
Operations Center
P.O. Box
CH-8058 Zurich Airport
Phone +41 43 816 50 60
Fax
+41 43 816 50 61
www.edelweissair.ch
Intens Travel
PRZ Ltd.
Andreas Zgraggen (Managing Director)
Geroldstrasse 20
CH-8010 Zurich
Phone +41 44 386 46 86
Fax
+41 44 386 46 87
www.intens.ch
Kuoni Reisen Ltd.
Thomas Stirnimann (Managing Director)
Neue Hard 7
CH-8010 Zurich
Phone +41 44 277 44 44
Fax
+41 44 271 52 82
www.kuoni.ch
Kuoni Reisen Ltd.
Incoming Services Europe
Rolf Schafroth (Managing Director)
Überlandstrasse 360
CH-8051 Zurich
Phone +41 44 325 21 11
Fax
+41 44 321 19 09
www.kuoni-incoming.ch
Manta Reisen Ltd.
Marcel Bürgin (Managing Director)
Treichlerstrasse 10
CH-8032 Zurich
Phone +41 44 268 24 24
Fax
+41 44 268 24 74
www.manta.ch
Privat Safaris
PRZ Ltd.
Urs Bellmont (Managing Director)
Geroldstrasse 20
P.O. Box
CH-8010 Zurich
Phone +41 44 386 46 46
Fax
+41 44 386 46 47
www.privat-safaris.ch
Railtour Suisse SA
Werner Schindler (Managing Director)
Chutzenstrasse 24
CH-3000 Berne 14
Phone +41 31 378 01 01
Fax
+41 31 378 02 22
www.railtour.ch
Rotunda Tours
PRZ Ltd.
Claudio Nauli (Managing Director)
Geroldstrasse 20
P.O. Box
CH-8010 Zurich
Phone +41 44 386 46 66
Fax
+41 44 386 46 88
www.rotunda.ch
United Kingdom
Kuoni Travel Ltd.
Sue Biggs (Managing Director)
Kuoni House
GB-Dorking, Surrey RH5 4AZ
Phone +44 1306 74 08 88
Fax
+44 1306 74 41 57
www.kuoni.co.uk
Voyages Jules Verne
John Dawson (Managing Director)
21 Dorset Square
GB-London NW1 6QG
Phone +44 207 616 10 00
Fax
+44 207 723 86 29
www.vjv.co.uk
USA
AlliedTPro Inc.
Patrick Birkhofer (Managing Director)
500, 7th Avenue
US-New York, NY 10018
Phone +1 212 596 1000
Fax
+1 212 313 9800
www.alliedtpro.com
Intrav Inc.
Clipper Cruise Line, Inc.
David Drier (Managing Director)
11969 Westline Industrial Drive
US-St. Louis, MO 63146
Phone +1 314 655 6650
Fax
+1 314 655 6673
www.intrav.com
As at March 2005
63
Agenda for 2005
General Meeting of Shareholders
21 April 2005
Half-year results
23 August 2005
Nine-month results
10 November 2005

A favourable year Annual Report 2004

Transcription

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