Corsair 747 writedowns tip TUI Travel into full-year loss

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Tour operator TUI Travel's full-year financial results show that the company turned in an 11% rise in underlying operating profit but that other items, including impairment charges on aircraft, dragged the company into a pre-tax loss.

It posted an underlying operating profit of £443 million ($735 million) despite flat revenues of £13.9 billion.

But this profit was dragged down into a £52 million pre-tax loss, partly by separately-disclosed items totalling £340 million, including a £124 million impairment charge mainly linked to asset writedown of French operator Corsair's Boeing 747 aircraft.

The company also incurred costs of £32 million relating to its sale of the city-shuttle business of budget carrier TUIfly to Air Berlin.

TUI Travel's cancellation of 10 Boeing 787s resulted in a gain of £23 million from discontinued hedge accounting, offsetting foreign exchange losses of £16 million on order book hedging.

The company completed sale and leaseback transactions of all seven aircraft acquired during the year, as well as four that had been held for sale at the end of the previous year, 30 September 2008.

Proceeds for the four owned aircraft amounted to £90 million and net sale and leaseback gains reached £4 million.

TUI Travel says it has no planned aircraft deliveries for the current financial year to September 2010.