Dufry positive about summer travel as it waits for Europe to reopen

11:35 am Thursday, May 20th, 2021

By Aida Pelaez-Fernandez and Veronica Snoj

(Reuters) – Swiss duty free retailer Dufry said on Thursday it sees “encouraging signs” for a pick up in foreign travel this summer after pandemic restrictions drove a 67% plunge in first-quarter underlying turnover.

The retailer, which operates more than 2,300 shops at airports, on cruise liners, in seaports, and other tourist locations worldwide, said it has great expectations for the coming months, adding that last week was the best in terms of sales volumes since the beginning of the pandemic.

“We expect sales capacity of 75% open by the end of June,” Chief Executive Officer Julian Diaz said on a conference call, adding that he expects that to rise close to 80% by the summer.

The Basel-based company said vaccination campaigns and an easing of restrictions were beginning to boost foreign travel, a trend it expected to continue.

It said it had already seen a strong recovery in sales in the United States and Central America in March and April, with the Americas region, which also includes South America, contributing 53% of net sales in the first quarter of the year.

Diaz said there was limited visibility on reopenings in the UK and continental Europe since it is not known when the European Union will introduce COVID-19 vaccination passports.

The EU entered what was intended to be a final round of negotiations on Thursday to bridge differences over the use of COVID-19 certificates designed to open up tourism this summer.

Dufry’s first-quarter turnover slumped to 460.3 million Swiss francs ($510 million).

The company confirmed its two average monthly cash flow scenarios for 2021 – break-even if turnover drops 40% and a cash burn of 40 million Swiss francs if turnover falls by 55% – and said it was confident it can achieve targeted cost savings for the year.

($1 = 0.9034 Swiss francs)

(Reporting by Aida Pelaez-Fernandez and Veronica Snoj in Gdansk. Editing by Mark Potter, Kirsten Donovan)