Pack Your Bags If You Wish To Travel To Europe

Summary

• Business and holiday travel to select European travel resumes from July 6
• Countries will be categorized under green, amber and red colors, based on their corona infection risk
• No need for a two-week quarantine requirement while landing back in Britain

Travel is no more considered a luxury but a necessity. Tourism is one of the major factors that can speed up the transmission of the coronavirus infections, and had not only acted as a catalyst but also has been a big victim of the pandemic for the same reason. Tourism has therefore been one of the worst affected sectors by the Covid-19 pandemic. The outbreak of coronavirus, followed by the lockdowns across various countries of the world, brought the industry to a standstill.

With the tourism industry coming to a standstill, all its ancillary industries were badly hit, such as airlines, restaurants, hotels, tours and travels, etc. The only positive aspect of the decline in tourism was that the environment became relatively pollution free, and harmful emissions on the land, air and water, all reduced substantially.

Amidst all the chaos caused by the virus, a good news has been reported by the UK Government for its people. Those who want to travel to selected European countries for spending their holidays, for business purpose or for any other reason, can do so from July 6. They will not be required to be quarantined for 14 days after returning. However, there is only one requirement that once they come back to Britain, the travelers will have to share their address with the Government. The announcement comes with a rider that British Government can reverse its decision anytime if the risk of spreading the coronavirus infections rises.

The complete list of countries will be out next week. Just as the colors of the traffic light system, the European countries shall be segmented into green, amber and red based on the risk frequency of Covid-19 disease. Travel corridor could include countries such as Spain, Italy, Greece, France, Finland, Turkey, Germany, Belgium and Norway, to be categorized under green and amber colors. Whereas, Portugal and Sweden might come under the red category. Reportedly, there have been new cases in Portugal and the infection rate in Sweden is higher than that of the UK. Hence, they are not safe for travelling for the time being.

The UK Government believes that this will be a good opportunity for the country’s tourism sector and economy to revive.

Now, let us take a closer look at three LSE listed companies in the tourism and travel space, namely Carnival Plc, Easyjet Pl and TUI AG.

Carnival PLC (LON:CCL)

Carnival Plc is a leisure travel company providing vacations to cruise destinations all over the world. Employing 150,000 people, it operates in 150 countries across North America, Australia, Europe and Asia. The portfolio companies of Carnival include Carnival Cruise Line, Princess Cruises, P&O Cruises and Cunard.

On June 18, 2020, the company released its summary of Q2 2020 results, stating that its total revenue declined to $0.7 billion, its adjusted net was $2.4 billion and adjusted earnings per share were $3.30. The company has announced incentives on certain bookings. It also contributed during the times of Covid-19 by returning 260,000 guests to their homes safely.

Stock Performance

Carnival PLC (LON:CCL) stocks traded at GBX 968.60 at market closure on June 26, 2020, which was down by 0.19 per cent from its previous day close of GBX 1,009.00. The current stock price was reported to be 36.85 per cent higher than the 52-week low price, which was GBX 605.00 and 298.41 per cent lower than the 52-week high price, which was GBX 3,859.00. It had a market capitalisation (Mcap) of GBP 1,771.69 million. The volume traded at the time of reporting was 2,808,467. The company recorded a negative return on price which was 73.45 per cent on YTD (Year to Date) basis.

EasyJet PLC (LON:EZJ)

Easyjet is a British airline company that operates low cost European airlines. It was in the news recently when it launched a GBP 450 million rights issue. It resumed its services from June 15, 2020, after being in lockdown for three months.

On June 24, 2020, the company released its half-yearly report ending on March 31, 2020, showing an increase in total revenue by 1.6 percent to GBP 2,382 million for HY20 but the passengers count decreased by 7.4 percent to 38.6 million.

Stock Performance

EasyJet PLC (LON:EZJ) stocks traded at GBX 651.60 at market closure on June 26, 2020, which was down by 2.75 per cent from its previous close of GBX 690.40. The current stock price was reported to be 27.09 per cent higher than the 52-week low price, which was GBX 475.00 and 138.18 per cent lower than the 52-week high price, which was GBX 1,552.00. It had a market capitalisation (Mcap) of GBP 2,661.29 million. The volume traded at the time of reporting was 12,789,336. The company recorded a negative return on price which was (54.43) per cent on YTD (Year to Date) basis.

TUI AG (LON:TUI)

TUI AG is an integrated tourism group of Germany, operating in various divisions such as Hotels and resorts, cruises, destination experiences, markets and airlines. It is listed on the FTSE 250 index of the London Stock Exchange. It has been in existence since the last 20 years, working with approximately 70,000 employees.

The company recorded a turnover of €19bn for the financial year 2019.

Stock Performance

TUI AG (LON:TUI) stocks traded at GBX 361.90 at market closure on June 26, 2020, which was down by 5.14 per cent from its previous close of GBX 389.20. The current stock price was reported to be 29.83 percent higher than the 52-week low price, which was GBX 254.00 and 198.84 per cent lower than the 52-week high price, which was GBX 1,081.50. It had a market capitalisation (Mcap) of GBP 2,247.11 million. The volume traded at the time of reporting was 2,474,159. The company recorded a negative return on price which was (63.49) per cent on YTD (Year to Date) basis.

It is expected that with Government opening air corridors across various European nations, the tourism industry will definitely get a big boost, at least with respect to the pent up demand for summer holiday. However, it is simply hoped that this does not bring in another wave of infections in the country, and derail the economy once again from the expected growth path.