Earnings Call: Q2 2020

May 13, 2020

thank you very much. Good morning, everybody. I hope you are well and healthy. This is important in these times. Thank you very much for joining in the Q1 Q2 results call. And I'm not 100% sure that I understand who turns the pages. Are we turning the pages? Okay. Good. So we will be actually now turning to Page number four, Undoubtedly, COVID-nineteen is the right crisis for tourism and TUI, which has ever happened. And we were just in Q1 in full steam ahead. As you know, we in January was big best booking month in the year, up 14% customer, 17% revenues for summer bookings. And then suddenly mid end March stopped no revenue. I mean this is unprecedented and I think no revenue until today. It's an interesting experience also for myself to run a company without a revenue. We managed to secure liquidity very fast, you will see that in the slides, and reduce fixed cost. Also, are thinking about the time after the crisis, it will be a company with more debt and also for significantly more debt and also a company with a little bit uncertainty, we believe, for next year. The revenue might be on the demand might be on levels of 2019, but it might also not be on the levels depending on the vaccine, depending on the perception, whatnot. We believe in 2022, we will have full demand and strong growth. We see traffic on our web pages. We see bookings, and I'll come to that in a minute, are very strong. So demand is there, but the crisis, the pandemic is not a worker. Now that's the reason why we said we need to be significantly changing our company, more lean, more agile, less capital, less investment and much more digital. We said we want to become a digital platform company anyway. And therefore, we have launched a program to save 30% of overheads. That will affect 8,000 roles. We launched the program in the company. We announced it this morning, and it's now progressing. And it will touch all parts of the business, but mainly Markets and Airlines as 80% of our overheads are actually in this area. Now people continue to have a passion for holidays, and we are a very trusted brand with a long history. Therefore, there's no reason to assume that the market will be not there, that we will not have a prosperous market environment. I mean that's very important because without a market, everything would be very looming. Now with the market, I think it's more a matter of time until we come back. Definitely safety of our customers, employees are our main priority. So we are very open to prepare for a responsible restart. We want to restart. We see the demand, but we only can start and want to start when it is safe. Now turning to Page number five, what has happened? And as I said, when you turn to the when you watch the dark blue boxes at the bottom, we had an exceptional start in some of the strongest January in company history. So after the Thomas Cook collapse, it was, you know, it seemed to be an enormous record year. But then, you know, COVID incident happened. Actually, not the COVID itself. That is something which started in China last quarter. But all ballots closed, travel warning and all into all countries, no business within a couple of days. Liquidity squeeze by cost running It could save money, and we will see that. And also prepayments flowing out of the system. The positive working capital actually going back to customers, at least partly, we find solutions in order to mitigate, but at least partly, that is actually very special in our industry. So we reduced costs and we acquired the liquidity. And that is actually the cash value alone. You will see that in a minute. We talked about it. And the loan is a facility in the frame of our current RCF. It is actually a bridge loan of €1.8 which is due in 2022. Bill, we'll talk about that in a minute. And now what we are doing is actually we are preparing for an integrated start up of our summer holidays. We have travel warnings largely in the countries until June. There are strong indications that at least partly the destinations will open and also that actually source markets will be sending allowing us to send customers. We believe it could be in the order of magnitude late June, early July that we actually can resume business partially into areas which are safe and where we test it. We did the first test of our hotels right now, test runs in Mallorca that were very successful and rollout of travel and leisure travel can be safe. The second thing, as I said, is our restructuring, digitalization, realignment, restructuring program which we have launched, which should give us a cost based advantage of 30% overheads. This is in the order of magnitude €300 €400,000,000 yearly benefit, and that is something which should be achievable. We have identified the ballpark of our program. I'll come to that in a minute. Now could we have known better? That's the question. Why is this so hectic? Why is actually we have the suspension of all travel and suddenly we need money and the RCF is partly not released and then we go to KfW and we have all this turmoil and then we need to be so under time pressure, could it be could we have seen it earlier? And I think the time line here shows it would have been difficult to digest. I mean the China COVID was December, we had 13% up in booking. Then we had the financial year twenty twenty Q1 results February 11, we are up 14% again, revenue 17% because prices were up 3%. So there is not an indication. Italy, that is actually North of Italy. We saw a little bit twenty first of it, but it's still 12% up and still 37,000 customers per day net growth. Even a week later, Tenerife are closing with the hotel. Remember that still 28,000 net growth. By the way, this even is seasonality because we have that the first week in February is stronger than the second, stronger than the third. So we saw standard stuff. And then we see the more or less the thirteenth to the sixteenth where actually it all collapsed and that actually the ports closed. The borders closed within three days. That was the Friday and Saturday and Sunday, we came together as a team and actually said, okay, let's see how we secured liquidity. And you'll see that this is actually a very, very immediate situation and I think also unprecedented in the timing of the events. Now how do we see the situation and the suspensions? And on the next slide, I have put the stuff on largely until mid June, we see suspensions. Now, at least in Germany, I can say, and I'm talking to the officials here a lot, there's an enormous pressure of opening borders. I mean, you know, people don't accept that Europe is closed. And, you know, you have that in in the neighboring countries to France and to Switzerland and to Austria, but also to Denmark up in the North. There was even a legal case which was won by customers who said, I want to travel to Denmark. And the court said, you cannot suspend it. That's not reasonable. It needs to be adequate and reasonable. And we, I think, can prove now that we have actually prepared our travels in a way that it is safe. Now we also don't start from zero. For the summer season 2020, we still have a booking level of 35%. Normal would be 59 No, 59% is much better than 35 but 35 is much better than nothing. So if we can reinvigorate the travel and if we said, for example, just Mallorca was possible, we would actually start rebooking customers from other places to Mallorca, fill our planes and fly. As I said, we have done good testing and certification of our hotels in Mallorca. So for example, that shouldn't be a problem. The same was true for Greece, for Cyprus, for Croatia, for Bulgaria, for The Canaries. I mean all of them have one thing in common, they don't have COVID infections. So that's not a good reason to assume that travel to there shouldn't be possible or shouldn't be safe. For winter, we opened the first and winter was actually in The U. K. We have now 8% up in volume and the average sales passed on last year's level. So also last year was good in terms of the winter bookings, so no reason to assume it will be weak. And summer is the most promising thing. I mean, most interesting and promising thing, we have doubled more than double the volume we would expect. So more than double the volume of last year for this year. So it's more volumes. It's a couple of 100 thousands. But it shows that there will be catch up effects. And at least from now, we cannot see that actually volumes will not be there. Prices are a little bit weaker than this year, but that's again very early days and it's also related to partly discounts they give in order for early bookings in August to fill next year, but I would say a very healthy situation for the future. And that indicates to me as soon as travel will be possible, customers will want to go. That said, need to be making sure that actually we can provide safe and non risk travel that will be at top of mind of our customers as well. And I'll come to that in a moment. How we do is what we do. But before that, I hand over for a session of Birgit to actually take you through the financial impact as well as what we did in terms of cost and also the KfW facility. Thank you, Fritz, and a warm welcome also from my side. And I hope you are all healthy and safe. So on the first slide that I'm going to present on the COVID-nineteen financial impact, as you know, our business is seasonal with the corresponding very seasonal liquidity stream. And COVID-nineteen led to an immediate cease of global travel operations, which led to an immediate liquidity need due to the customer refunds and the coverage of fixed costs, as you all well know. And as you can see from this illustrative graph on the left hand side, at the March, we usually have quite high customer deposits on our balance sheet with a further steep increase during Q3. And this is and you know that, we call that a typical seasonal tourism swing. And the suspension of all operations as of March 16 led to the fact that the positive seasonal swing did not materialize. And moreover, customers could request cash refunds for canceled holidays. So at the March, we had €3,400,000,000 of customer deposits on our balance sheet, and this situation led to an immediate liquidity need due to the typical working capital pattern as well as a fixed cost coverage against a standstill on revenue. And to address the liquidity needs due to this working capital pattern, we took immediate action and secured the KFW bridge loan in a record time. And we also initiated other mitigating actions apart from, of course, the drastic cost reductions. We there were other mitigating actions like incentivizing customers to rebook to a later date. We opened for summer season twenty twenty one much earlier than we usually do. And we worked with various European governments on a voucher refund mechanism to save liquidity in this crisis situation. And the current trend is that between 5040% of customers are taking a voucher credit or decide for a rebooking, which we consider a success and demonstrate that people are willing to go on travel with Zooey as a trusted plan. Based on the current scenario, we estimate customer refunds per month to be estimated at a low to mid single digit CHF100 million. And when travel resumes, and that is what we try to elicitly show because we do not have a date yet, we expect a steep recovery of working capital, and that is represented by these light blue dotted lines and the various as this is a data point obviously that we do not have at the moment. So then moving to the next slide, please. Thank you. So during the suspension of all operations, we undertook significant crisis measures to limit cash outflows through an extreme reduction of costs and expenditures to an absolute minimum. From capital expenditures to marketing, salary costs, accommodation, rental and lease costs, all expenditures have been cut or paused reflecting our strict cost discipline required during these very exceptional circumstances. So this has been a top priority for the business as a whole. So everybody was focused on that. And the overall fixed monthly cash cost base has been substantially reduced by around 70% on how we calculate a fixed cost. And let me explain that to advance contracting to secure committed capacity for the seasons ahead is the base of our business and that we typically see a high level of operational leverage. And in a normal year, circa 63% of our cash costs across the business are deemed to be fixed. So this translates in a normal year into a cash outflow in a range between DKK700 million to DKK1.4 billion per month and of course the latter during the peak season. We reduced this range substantially during the COVID-nineteen crisis and we managed to reduce costs to an absolute minimum and expect our cash fixed cost base to be reduced to a minimum range of between $250,000,000 to €300,000,000 per month as long as our operations are suspended. Please note that this number excludes cost of payment obligations below EBIT for which an average run rate of circa €50,000,000 per month can be assumed. The largest cost base for the group is accommodation where we involved the force majeure clause on hotel contracts. Incremental aircraft leases have been renegotiated with our lessors as have payments with landlords in our sales and resource business. Those shifts have been laid up, leaving around 50% of monthly costs, and we took the difficult but necessary decision to reduce staff costs worldwide from April onwards. So short time work, take up, furlough, unpaid leave or other staff cost saving measures were applied across the group, whereas our business was and of course still is due no cost. We have participated in government job retention schemes where available. And these substantial measures across the business have helped to deliver a 50% cost saving and salary cost in May with 90% of our employees participating in the above measures. So let's go to the next slide. Zui was the first company to and February decided to successfully obtain a KfW bridge loan as we applied immediately after the announcement of the program by the German state. And we received the approval for a 1,800,000,000.0 kmhw bridge loan facility just ten days post application. And we were able to apply with this level of speed as we had our financial scenarios proactively ready and could present a comprehensive liquidity picture during the weekend of March, which now seems a long time ago. We presented an exhaustive scenario analysis of the situation and the financial requirements, including a solid repayment plan under the agreed scenario. During the whole process, we were supported by our existing banking consortium, and I would like to thank all parties involved for this extraordinary and joint achievement. The 1,800,000,000 support is an extension to the existing €1,750,000,000 revolving credit facility, and you can see the details of both facilities on the right hand side here of the slide. As already announced in our ad hoc statements under the terms of the loan, the annual dividend will be suspended during the course of this credit line. And both covenants, net leverage ratio and interest cover relating to the existing and also increased RCF will be suspended for the next eighteen months. So covenant testing will resume in September 2021. And finally, at this point in time, we have cash and available facilities of €2,100,000,000 and this is a reduction of €1,000,000,000 since our last announcement, which we did on the March 27 as we needed to cover cash out for fixed cost, certain amount of customer refunds and the repayments as scheduled for financial maturities in the amount of €450,000,000 So then moving to the next slide. As I mentioned earlier, we work on liquidity enhancing measures such as the earlier discussed fixed cost reduction and also the mix of voucher refund credit mechanisms that we easily work on other levers. And that's also what you see here. So we immediately suspended investments and reduced our And we already discussed earlier that TUI would be more rigorous with CapEx going forward, and we are taking this very serious. You know that also from all of our last conversations. So we will reduce our investments with 50% to a level of maximum €450,000,000 this year from our earlier guidance range of $750,000,000 to €900,000,000 prior to the Air Baclore transaction. We expect some tax relief due to acceleration of refunds and deferral of payments and fees. Also, the partners are actually very supporting. The Hapag Lloyd Cruises transaction will lead to a cash inflow of approximately €600,000,000 as you know, and we will reduce the capital intensity of the business, including the sale and leaseback of assets. When the business restarts, we will see a significant working capital inflow, and that is very important to note throughout this cycle. And all these measures will contribute to the improvement of our financial profile And with cash and available facilities as well as the liquidity enhancing measures, TUI has sufficient funds to cover the coming months. But of course, we remain proactive. As you have seen from the KFW bridge loan application and how fast it went, we are equally proactive at this very moment. And we are currently evaluating a variety of options with the aim to best position to reach balance sheet and liquidity through an extended period of disruption and post crisis. One thing is sure, we are strongly focused on rebuilding our solid balance sheet profile post crisis. And as I also said earlier, a prominent driver is the restart of our operations with the recovery in bookings, resulting in an immediate and substantial working capital inflow. So let me, with this, hand back over to Fritz Fritz. So, Birgit, thank you very much. You see we have secured liquidity. We have a solid situation in terms of cost. Things are in control. We are managing also liquidity outflow to customers on a daily basis. Now is the question what do we do next, right? And the one thing we are doing is, of course, we are trying to find ways in order to allow revenue again because on a permanent basis, loans and bridge loans and debt doesn't replace revenues. And therefore, this is the utmost importance. And we have as I said, we have good booking status. Still we have good forward bookings in next season. The question is when can we start? And here we have worked on a 10 plan together with actually all partners who have similar low COVID-nineteen infection levels or even lower and I talk about Canaris, Balearics, Greece, Cyprus, Croatia, and others, I think travel to these countries would be possible if allowed. I think demand would be high. I think we have a program in place. I come to that on the next stage, which actually allows for safe travels. It's important to our customers. Equally, it's important for customers to travel. In the public, I see pressure building because there's not a good reason to close borders. And as I said, even the first court have ruled that closing borders is not appropriate. So in the destination also, it's very important. Customers wanted destinations, wanted destinations in many cases. Tourism is the most important economic sector. In Greece, for example, 20% of GDP or 18% of GDP, of course, in summer double because it's only half year season. So not missing the summer is a huge issue for Europe as well. And I hear and I see that actually that is taking ground. And therefore, I'm quite hopeful that in June or July, we will be able to resume business. And we are prepared. That's what we say. And you see on the next page the level of detail we have. This is actually the at holiday 2020 secure safe travel during COVID-nineteen. It is actually touching all touch points, addressing all touch points of our customer flight in destination hotels, cruises. It's exactly what we do and we are even designing holidays for self travel. For example, we have put our ships to cruise ships to actually Northern Germany as soon as possible. We will be offering three to five days cruises. So the North Sea is anyway very popular with 1,000 guests. 1,000 guests are the limit which the German government has anyway agreed that 1,000 in certain destination is possible. So we are in preparing designed holidays in order to be attractive. So it's not in our hand to open the holidays, but it is in our hand to be prepared. And together with our partners in destinations, we have now the program, and we are now negotiating thoroughly. Now this is actually number one priority because it resolves a lot of problems. It resolves the problem of revenue. Particularly, it also resolves the problem of liquidity because as soon as we open our business again, there will be liquidity inflow for positive working capital. By the way, even having closed summer and only for winter and next year summer, we have €50,000,000 inflows already today per month. So it's something as soon as the markets open, liquidity, I would assume, is not the issue. Now anyway, what will remain an issue is debt because we will have debt and the first amendment remains to be seen how much of the credit facilities we will be using, But debt will be an issue and it needs to be repaid. That's very clear. And therefore, we have now put this three pronged plan for the future of TUI. The first one is actually reducing costs. And how we do that is we accelerate the transformation project we have been planning anyway. We are more ruthless in merging tasks and organizations across the group and consolidate global IT structures. So it's not just taking off people and assuming that they'll be working. It is the challenge of reducing people and increasing quality. And one of the things, just to give you an illustrative example, we have 25 call centers in the world with €100,000,000 of cost. So it's not a good reason to assume that this is optimal. Quite to the contrary, if we wanted to outsource it to a third party, we could save tens of millions per year immediately. But of course, it's close to the customer and we need to be careful, but it shows what kind of potentials are still untapped. And I have launched the program together with the colleagues this morning, 30% cost reduction in the order of magnitude €300 to €400,000,000 yearly cost benefits will affect 8,000 people. So this is, I would say, bread and butter. I mean this is nothing to discuss about. It's just execute. I mean it's not risk that it will not happen or whatever. I mean this is relatively easy. So then we get into the middle column. In the middle column, we have historically or historically in the last phase of transformation became product centric. We invested more into cruise ships, into aircraft, into renewal of aircraft, into hotels. This is over. This is over and for two reasons, actually for three reasons, if you like. The first one is we have debt, and the money is not easily available. The second is we have an oversupply, and we will have an oversupply foreseeable in the next year. And when you have oversupply of assets, investment into assets is not very good. So if you have undersupplied, then you have good yields. If you have oversupply, you have better trade. So we will be more asset light, and we will be using many means of balance sheet structures, selling and leasing back or managing back hotel assets, looking at the stature of our airline size as well as ownership structures in terms of aviation. And also, we will actually look at the clear fixing and divestment of nonprofitable businesses. So this is a little bit more. I mean in the past, it could be we have been maybe not as strict as we could have been. But I tell you, now it will be either you fix it immediately or it will be a difficult time. So this is a little bit more, how do you say, it is more strategic move. I want to manage I want to say one thing. This doesn't mean we will not content be content centric, right? We just will not do bricks and mortars, right? So content centric means control of product, control of brand, control of distribution, control of customers. This will stick. Differentiation, this will stick. What will not stick is actually investment into bricks. Because if you're oversupply in bricks, earning money on bricks will be not that easy. We say asset wise because selectively we might be wanting to own bricks still. Capverde is a typical example. When you have 100% of five star hotels or what I mean then it's difficult not to own the bricks. But other than that, we will be seeing that we actually can get assets more asset light, much more asset light than we are today. And I could do the same thing with ships. We talked about Magala anyway. We showed what we did for Tappac Lloyd Cruises, a deal which will be closing in June, by the way. And so I mean it is what we will do. The third reason the first reason was that the second reason was actually overcapacity because of uncertain demand. The third reason is on the right side, when you want to become a digital platform company, that's what we said articulated before, assets don't fit. And so as we accelerate our journey now to become more digital, we actually will actually we can invest less. What does it mean more digital? Online strategy, people have been using online purchase means in the crisis when they had to stay home. Will they shift back? Maybe not. People are okay with using online services in app service in destinations. We see that we have actually accelerated our online strategy there, so all touch points across the value chain. And the last thing, which actually is actually the first bullet on this right column is that we increase accommodation only, flight only and dynamic packaging. When we have an oversupply, these kind of free available goods, which are also shorter booking cycles, will be important. We have good experience in our GDN. We have very good experience in our Overland business in Germany where we have 1,000,000 customers. So we will actually accelerate our Eco only. Flight only, we have also good experience with third party flying also our flights to third party customers. We have good experience as well. We will have another P and L fostering it. And we will actually also think about the future of package. And this future of package needs to be more flexible, more dynamic, more customer friendly. And all of that is the digital backbone of our systems as we have announced them anyway. The difference is we execute faster and no euro for legacy IT structure. And that is actually 100% focus to the future, zero focus for legacy. That is the difference. So that said, I would actually come to the half year results. And you see that on the page, five months were still okay, not only okay, was good plus 6% revenue plus 21% EBIT. And then more or less everything stopped in March and that's what And maybe when we go to the bridge next slide, you see a lot of moving parts back and forth. The only big thing which I want to highlight are the minus $470,000,000 on the right side. And the blue box explains what it is. The minus €470,000,000 is mainly loss of contribution to €420,000,000 This is actually the missing business. There is no business, no contribution, okay? You should be seeing this repeating over the next months. A little bit less because we have been saving costs. At the same time, volumes are a little bit bigger. So we always said our costs are around about $250,000,000 or whatever, and this is the $250,000,000 right? So that is the missing contribution. This is actually what we'll be repeating. Then you see a second, so but why do we not see the $470,000,000 for the next month? You see, for example, hedging effectiveness, that is actually we bought, of course, for the we sold, we bought fuel, a future, so hedges for our fuel for $60 per barrel. And now it's $30 And of course, this needs to be accounted for, and that's what you see here. The 146,000,000 are actually taking care of the ineffective hedges until June. And therefore, it will not repeat. And also, it might even reverse a little bit if the oil price comes up or whatever. But the big step, the big let's say, big step is done here and that's part of the $470,000,000 And then you see smaller numbers. Repetuation costs, of course, will not repeat celebration impairment. So we dry docked the ship. I would say, took the ship out of the water because there will not be any business anymore, 19,000,000. But it's, of course, book. Then you have the MAX costs are very minor because they don't fly and will not repeat because particularly when they don't fly, they will be zero. So therefore, more or less, what you can say is $240,000,000 will repeat in some form or shape, 146,000,000 will most repeat in some form or shape. And that's a pretty good indication, I think, for the future months if you don't take into account the payouts to customers. Payouts to customers are difficult to judge. In some of the countries, we have the vouchers. In some of the countries, we don't have the vouchers. Even if you don't have the vouchers, in some countries, you have state guarantees. In some countries, you don't have state guarantees. This makes a huge difference. Also, what makes a big difference is if the ministry say there will be no summer vacation or if they say there will be summer vacation because if you can redeem the voucher soon, everybody accepts the voucher soon. So Birgit talked about it, it will be something low to mid hundreds millions. But as we said, it's just working capital. So as soon as business comes back and even if it comes back, something comes back. Now as it didn't come or doesn't come back for summer at all, we still have €50,000,000 inflows. So you can imagine what happens if the business for the summer at some form or shape will be resuming. Now that said, we have a couple of more slides. This is actually one more slide, and I thought we had also another waterfall, but this is more or less what I expected, the $470,000,000 Now you see a little bit of segmental reports. In all fairness, I will not give you positive meaningless. I mean if you have a time like this who takes care about or who cares about these numbers, The numbers are actually distorted, as you can see everywhere because we have one month of new operation, and that actually is not very meaningful. If you have questions, we are very willing to answer them in a later stage of the conversation. With that, Birgit, I think you would like to you will take the people through the P and L, right? Yes. Indeed. So let's then go through the income statement. And here, as I did during the first quarter as well, I will focus on the year on year comparison with pro form a IAS 17 figures for the first half instead of the IFRS 16 numbers for comparability purposes. So here, you can see, obviously, the turnover year on year was flat, reflecting the lost revenue from the travel suspension in March. And the underlying EBIT decreased by five twenty seven million euros mainly as a result of lost contribution and costs arising from the COVID-nineteen travel suspension and Fritz just talked about that. The adjustments are significantly better year on year as we booked a 91,000,000 gain on disposal from the sale of our German specialist businesses, Bergen and Meijer and Boomerang, which closed in October 2019. As a result of the positive adjustments, reported EBIT is down by EUR432 €2,000,000 compared to last year. And group results after minorities are down by $5.00 €5,000,000 translating to an underlying EPS of minus €1.31 Referring to the reported figures under IFRS 16 and as flagged during our IFRS 16 call in December, both depreciation and interest charges are higher as a result of IFRS 16. Okay. So then we move to the cash flow slide. And as you know, before the COVID-nineteen crisis, we launched a dedicated program on cash flow with a target to generate positive free cash flows post dividends, and we were very well underway to deliver. And you can still see the impact in the 2020. Unfortunately, now due to COVID-nineteen, the situation will be different, but at least you will see that we were very well underway. Managing cash flow and liquidity is our number one priority, and you will equally see from this chart how quickly we actively address the cash items in our remit. The group underlying EBITDA reflects the impact from the COVID-nineteen travel suspension, and we more than offset the decline in operating cash flow by a reduction in our net investments as we cut all major projects during the current period of travel suspension. This leads to a free cash flow of minus €1,400,000,000 slightly ahead of prior year. Please note that the disposal proceeds from the sale of the German special businesses during Q1 are equally included. Free cash flow after dividends ended at minus €1,700,000,000 up from €70,000,000 versus previous year. And this includes dividend payments for 2019 as the payout was mid February before the COVID-nineteen crisis. Please note that cash flow from financing has increased because we have drawn down from our RCF to help fund our seasonal working capital requirements. As you can see from the IFRS 16 column of the cash flow statement, the higher operating cash flow is offset by a lower cash flow from financing due to increased payments for finance lease liabilities. So the total cash flow, as you can see here, is the same under IFRS 16 and pro form a IAS 17. And one final comment here again, this year's net CapEx and investments will be reduced to circa €440,000,000 a reduction of at least 50% compared to previous guidance. Assets and debt financing is expected to amount to around €400,000,000 Please note that these numbers are clearly the effects from the Half Life Lloyd process transaction. Then moving to the next slide. The movement in net debt. So the first half closing net debt based on pro form a IAS 17 numbers increased to around €2,650,000,000 in line with the usual seasonal swing and driven by discussed development of free cash flow in the first quarter. Referring to the last line of the table, you can see compared to the previous year that our seasonal swing in net debt has improved by €348,000,000 which is predominantly due to haber florist cruises now being reported as a disposal group. Regarding the other elements of the movement in net debt, apart from free cash flow, asset financing increased according to plan with roughly twothree related to committed aircraft re leasing of new Dreamliners and the remainder related to cruise ship financing of around €120,000,000 As expected and due to the first time adoption of IFRS 16 and associated lease liabilities, net debt is higher based on reported IFRS 16 figures. And then lastly, on the next slide, I'd like to remind you of our withdrawn guidance. And on the March 15, we withdrew the group's full year 2020 financial guidance based on the current unpredictable situation. And as you will all understand, we also refrain from issuing a new guidance as uncertainties continue to exit. And as already mentioned, we need to waive dividend payments for the term of the KfW credit line. So with that, I would like to hand over to Fritz Lang. Thank you, Birgen. That's easy. Because now the slide is actually the first slide again, right? In summary, big crisis, short term liquidity management, reducing fixed costs, it's not so difficult. That's what we did and we have now decent liquidity for some time, and we will relaunch the business hopefully soon. Now as soon as the business will be relaunched, we will actually go from liquidity to P and L and manage P and L. And that means profitability up, investments down, costs down, agility up, quality up, so cost down and quality up. This will be the digitalization project, 30% cost down at 1,000 volts in focus. And as I said, I mean, we had a very strong generally, the strongest in company history. And the reason for that because customers want to go on vacation. There's no reason to assume that to change. We had a good discussion on business travel. Business travel might be different. People might be used to online working and home office hours and will not travel. But all indications I see is that people want to go on vacation, Just viewing a movie of a destination is not good enough. Market will be there. Traffic on the website is good. Future bookings are good. So as soon as we are allowed to do business, we will have good business. But two of them become leaner, less capital intensive and more digital. And I think that's good that every crisis is a chance. Thank you very much. We are open for your questions. And the first question comes from Jamie Rollo from Morgan Stanley. Please go ahead. Thank you for taking my question. I hope everyone is well. Good morning. Three questions, please. Maybe I'll ask them separately. First, on the liquidity. It looks quite tight, that GBP 2,000,000,000, given you seem to be hinting at maybe GBP 1,000,000,000 customer deposit outflow. And there could be, I guess, another $1,000,000,000 on the trade payables plus the cash burn each month. So I'm just wondering, you seem to be relying on the markets reopening. So the question is, what happens if markets don't reopen and your operations remain suspended for a bit longer? How many months' liquidity do you think you have, please? Yes. I can already sort of reply to that, Jamie. Thanks for your question. And I understand your question, of course, because nobody knows when travel resumes. At this point in time, as we said, I mean, customers are willing to travel, but it's uncertain as to when that happens. What we can tell you is that as we demonstrated also and started during the weekend when the COVID-nineteen crisis started is that we are on top of things. And we were the first to go to KfW. We had our scenario planning ready. We could never have gone so quickly if we didn't have our scenario planning already before that because that normally takes a while. So then we have also the successful execution, of course, of requesting the KFW bridge loan. And then TUI is obviously very important also to Germany. So I would like to point that out as well. So this time and I'll go quickly to the levers of liquidity. But this time, again, we are proactive. We have our scenarios ready only when will travel resume. That is a big unknown, of course. But we do have options, alternatives. And what I can tell you, and that is what you have done because I looked at your analysis, that we have a fixed cost run rate, which is about CHF $250,000,000 to CHF 300,000,000 a month. Then you can think of customer refunds in the same order of magnitude as what I just mentioned on the fixed cost run rate. Then we also expect the Apoqueloit proceeds, not to forget, it's during the month of I mean, in the next month. And then the bookings for summer twenty twenty one, we see them already as we reopen. And then we think of other items like sale and leaseback, you could think of that and other items as we mentioned. So what I can say is that we are proactive and we do everything that is in our remit and we can currently announce the €2,100,000,000 liquidity, which is probably more than you would have imagined when we talked two months ago. So with that, maybe Yes. I mean, Jamie, it's good. I would have bet you are the first and you have three questions. And I think it's an important question. I mean liquidity is top of mind. And this is not only CFO, that's also me. Every day, me personally looking what we pay. In the first month, saw the liquidity drain, which is much bigger with also the past which is good because we had to I was off some financial instruments. Operationally, it was much less and the savings only kick in right now. So as Birgen said, let's assume for a moment $250,000,000 cash trend from fixed cost. My personal view is we will be on top of things. We have now a 50% repay rate. And my view is as soon as we see a little bit light end of tunnel, it will be not a problem because then also cash will be flowing. And as Birgit said, the $650,000,000 from Abac Lloyd are to come in June. That doesn't say liquidity will be lasting. And it's obvious there. We also look in parallel, of course, plan for the first hope for the best. We are looking at our options. We will see the options. The options will be more probable than in the first round. That's also clear. In the first round, the banks could have gone away. The KfW was not there. So I'm positively in a positive mood. But of course, it is day to day management and liquidity is number one, number two and number three priority. Okay. And then just on my second question, which you touched on other options to increase liquidity. Could you on the sell and leaseback idea, could you please quantify the value of the 100% owned assets the company has that are not encumbered by debt already? So what is the quantum of assets that you could raise money against, please? And as an alternative to that, are you considering equity as an option rather than just simply adding Okay. Yes. I mean, it's David. First of all, we don't disclose. But of course, we have to believe us they are not huge, but they are significant. I mean but we don't disclose yet what is an option what is in our hands. The other one with equity, I mean, today, does it's not if possible, it's not the right thing to do. I mean because the equity markets for us at the current share price levels are not efficient and very dilutive. And also not accessible, by the way, in the time we need. That said, this is our foresight for next half year, I would say. Of course, we are looking at all options, but if possible, we will do something else. And I think there are enough other options, which I'm absolutely clear are possible. Okay. And finally, you mentioned Hapag Lloyd. How certain is that deal to go through? Has the joint venture raised the debt? And does TUI need to inject more cash into that JV? No. Certain, no. No. No equity injection. Certain, yes. It's raised the debt, is it already? Sorry? You know that yeah? Two courses assigned to this one. Liquidity. And it's raised the debt to fund the Hapag Lloyd acquisition, has it? Yes. Okay. Thank you very much. And the next question comes from Jaafar Mestari from Exane. Please go ahead. Hi. Good morning, everyone. I've got three quick questions, please. The first one is just on cash burn since April. So €2,100,000,000 liquidity today is about €1,000,000,000 lower than at March. And even if we exclude the debt repayment, it still looks like CHF700 million of cash over six weeks. Could you maybe just break that down for us between operating cash burn, financing and working capital just so we can see what gets better from here? Second question on consumer behavior for the rest of 2020, maybe even 2021. What sort of destination mix and product mix do you think you need to deploy? And did you assume demand will be very much the same? It's just going to be an uncertainty on volumes? Or are you adding, remixing different destinations closer to home, domestic trips, short trips, etcetera? Then my last question would be on the long term capital structure. As you said, you may have enough loans and bridge loans and debt for now. But I guess there's an entirely separate question, which is what is the long term sustainable capital structure for a business like TUI? So what sort of level of leverage and what sort of debt versus equity mix would you feel comfortable with over the long term when this is repaired? Laura, do you want to start? Yes. I'll start with the last question. And of course, currently, it's a bit early to talk about that because we do not know when a travel resumes. And as I said before, we have various scenarios. Of course, adding substantial debt is and depending on when travel resume because this is a really big factor there when travel resumes. And we did that modeling as well. The working capital inflow is really very substantial. But suppose in a worst case scenario, you would have to add more debt. Of course, we need to think of solutions for a healthy balance sheet that speaks for itself. So and there, we will and we are looking at a variety of options, and it is really way too early to talk about that. And also, obviously, you need more data points when the travel review is already one of them. But I do understand your question. Then on the Calburn, so far, so we have a portion of, let's say, around, let's say, $350,000,000 to €400,000,000 of commercial paper also and the laterals are included. And the rest is, as we said, taking down fixed costs substantially and also with the customer refunds. So there, you will start seeing the repayments than it is towards the rate that for also for your models, what I just mentioned, it's same order of magnitude as the fixed cost run rate. That is what you can take. So actually, it demonstrates that we were really very focused on cash. And as Fritz also said, it's also in our daily cash flow. So we really have a cash power in place where we discuss everything that comes in and out. So I think that gives the perspective. Yes. Part of maybe a couple of remarks on my side. I mean, the first one, the repayment of customers and also the payment of hotels, both are a part of the other, let's say, same order of magnitude. And I can tell you, we are sticky on this because it's also very clear. The longer we actually keep our cash together, the more likely that it will be kept in the system. And also for with our hotel partners, like with all other partners, we are agreeing payment schemes that we pay a part and everything else will be paid once the business is resuming. Everybody needs to suffer a little bit. If the revenue is gone, then the revenue is gone. And being part of the 2E family has significant advantages for them because we will restart the business together with them. So we will take an appropriate contribution from their side in order to be part of our family. In terms of traveling, I think what we are preparing for is very clear, we will we are preparing for destinations where we can control safety best. And that is areas where COVID infections are low, areas where we have limited connections to the general public, if you like. Islands are good. We will be very careful with excursions and mingling up customers with locals and so on. But that's also accepted from their side. So coming back, it will be also South Of Europe. We need to have and we want to have medical service close by. So we will not eliminate the risk of infection, but we will mitigate the risk of infection, right? So nobody can eliminate it, but mitigation. So what do we do if things happen? And we have concepts in place, but that's, of course, in Europe easier than in places outside Europe. So will be Europe's good. It will be as said, cruises will be limited in terms of load factor and maybe even Germany first so that we are starting from here and do shorter cruises and so on. So it will be a little bit more close by. Thing is also clear, we will be opening hotels in Mexico soon for Mexican and American customers. I mean, that's very clear. So these hotels will also open and the offers will be there. I just believe that the long haul flying will be something for the summer. It's not maybe not the right thing. Now it is anyway bigger in winter. So therefore, we are now pushing a lot for local and for European. Hope that helps. Thank you very much for that. I guess my question on the cash burn was more backward looking. I just meant really, it looks like €1,000,000,000 lower liquidity over the last six weeks, 300,000,000 is the debt repayment. Could you maybe give us some color on the other €700,000,000 that you've consumed over six weeks, please? What was the super commercial impact? Yes. See, it's a mix it's actually a mix of things. So I would say on the operational cash out, let's say, it's really in the run rate that we just mentioned. So that is already one thing. And then the rest also, for instance, customer refunds and also some insurance covers, etcetera, that we have to cover. So it's actually fully in line with how we model it. Mean, sorry, I think if I understand your question correctly, you think is it really as low as we think going forward based on the experience in the past. I mean, first of all, when we started the business, then the cost structure was not there. So it was not $250,000,000 to €300 So the first two weeks, see more. Then you have the commercial papers, which actually had to be returned. Then you see a little bit of reserved cash as well, yes, so cash collaterals for actually travel, but this is full season effect, so it's not repeating. And that actually brings us to the amount. We have now a daily projection of actually what the cash payments are. And I can assure you, I personally sit in the call every day. And it's not the first time I manage a company for cash. And when you are managing a company for cash, you don't care so much about the P and L effect. We are managing the company for cash, and we will be doing that for the next two or three months, however long it takes, until we have a full restart in the system. Okay. Thank you for that. The next question comes from James Aynlie from Citigroup. Please go ahead. Good morning, everybody. Thank you for taking my questions. Three questions from me as well, please. First, on your commentary about shifting to more asset light. How are you particularly thinking about the structure of the airline and provision of aircraft lift? Context, if it's fully outsourced. Second question is, could you give us a breakdown of the percentage of customers whose holidays are canceled, what percentage accept credit notes or vouchers, what percentage would book funds and what level of discount you're giving to those? Yes. Sure. And Sever? And then the third one is just can you update us on the status of the compensation from Boeing, please? Yes. Okay. With Boeing, we are in good negotiation. No further status, but we will I'm pretty sure I'm pretty hopeful that it will be resolved, yes, and not in so far future, yes. The asset of the airlines, having an airline is not an option. It needs to be more intelligent, Yes, an airline is an essential facility, but something is also clear, we need to rightsize the airline. We have to have an appropriate size and an appropriate structure and so also an appropriate asset structure. We have been thinking about that quite a while. Now as we don't fly, it's maybe a good opportunity to focus a little bit more on that. And the last one was 50%. 50% return rate of not voucher. You also asked policy incentive for a voucher. This is different in different countries. I would say on average 15%, maybe 10, 15%. But also please remember 10%, 15% is not physics. I mean at the end of the day, in U. K, we give 15% online discount, right? I mean at the end of the day, don't put discounts on discounts on discounts, right? So it will be a little bit smarter than But we are face value, I think, in U. K. Is 15% on average. And Germany, I think, is €100 for a full paying member of the travel group. So it's a family, it's a parent, two children. Anyway, it's we are playing around a little bit. And at the end of the day, the more important point is the conversion of the redemption of the voucher is good. Did you say 500% of people take cash demand cash refunds? Yes, yes, yes. And the next question comes from Richard Clarke from Bernstein. Three, if I may. Just want to just reflect on your comment of being a leaner organization going forward and cutting 30% of your cost. What would you expect to be the sort of top line ambitions here? Would you still be looking to transport 21,000,000 customers? Or does that number come down sort of roughly in line with that 30% as well? Second question on your comment around disposals and disposing of non profitable entities. I mean, I guess, there's some probably pretty big chunk of your company like The UK and Germany that can go quite close to that. You know, how big could those ambitions of disposals be? What are we talking about there? And then third question, just coming back to cash needs again. Obviously, you've got some support from the German government. Are there any discussions going on with Spain or Turkey or The U. K. In terms of support that they might be able to provide given the importance of tourism to those countries? Let me try to focus. I mean, lean organization, of course, top line will be back. I mean maybe not next year, but the year thereafter. If there's a vaccine, it will be growing fast. I mean we are talking about more lean and digital execution of executive tasks we will be doing in higher quality with less cost. So when we talk about the savings, it is savings on existing revenues. Now that said, maybe not next year it will come back. Therefore, we are having a little bit more bigger or a little bit more flexibility in the system. But long term, it's just value increase or margin increase, if you like. How big is the ambition for disposals? Mean, U. K, Jarrod, where did you see the of nonperforming assets? And you thought U. K, that's interesting. No, I think we are talking here France and we are talking here other parts of the business. We have a Spanish business. We have a MICE business in Destination Experience. We have a harbor handling business and so on. I mean we look at a lot of businesses, but not the core business, right? And the German government I mean we have local schemes to support labor. These are all local. We have local schemes to support working capital. These are local. There are European law, but the countries have actually implemented very different things. But on the KfW loan, this excludes, as to my understanding, third country support. So even if it was available, it's very clear that this kind of facility is a global facility. By the way, that was one of the big issues that this is supporting our global activity and not only German activity. And it was one of the big successes of negotiation initially to achieve that. And you can see with other companies, other airlines that this is quite can be quite a distraction if you don't achieve that because you have one company. And how can you make sure that the money flows the ways and you cannot how I say you cannot pay the money. The money is the money, right? And at the end of the day, it's difficult when you look at prepayments from German customers to a certain hotel. How do you want to do that if a certain money is only granted to secure certain parts of the business? So the KfW facility is a facility, which is a global facility, but it excludes the like government scheme in other countries. Does that answer your question or Yes. No, that's clear. Thank you very much. And the next question comes from Adrian Peel from Commerzbank. Yes. Good morning, everybody. Also good to hear that you're safe and healthy. So a couple of questions. First of all, on your presentation on Page 12, actually, where you outlined potential destinations that might open up anytime soon. I was just wondering if that portfolio that you mentioned there would be already sufficient to make you satisfied for the summer season, I. E, if Spain Mainland does not open up, Italy or Turkey, is that still enough for you to have a decent business for this year's summer? My second question is coming back to KfW a little bit. I mean, obviously, in spite of the fact that you are quite confident on Abaclod cruises sale, I'm just trying to get my head around why the amount has not been like €3,000,000,000 for example, since liquidity still obviously appears to be tight. What are the prerequisites for higher amount? And can you get additional money if you find out finally it's probably not enough? And a question on actually sale and leaseback measures that you just announced. I mean it's probably kind of a chicken and egg problem, isn't it? Because otherwise, if markets do not open up, then actually the sale part of the sale and leaseback is probably a bit difficult in terms of pricing that you might get. So any comments on that? And very lastly, you obviously got new shareholders since April, Mr. Ishati. I was just wondering and curious to hear your thoughts if you had already some contacts to him. And does he have any ideas strategically? Or what's the situation there? Maybe you can go on the amount. And I understand your question with the information you have today, May, then you would could think, oh, why is this not €3,000,000,000 instead of €1,800,000,000 But you need to think in how it was and maybe you remember where you were in March. That was a totally different situation. Nobody would have expected we would sit here today like we are sitting around the table with the phases in between, etcetera. I mean, it was a completely different situation. And at that time, we were counting with a resumption of travel as of the June. And everybody thought even there, yes, well, that's a kind of that's a very terrible case. So that is in light of that, that you need to see this development of the COVID crisis. And I think it's for many companies the same. You can only act with the information you have on that specific day because nobody knows. And that's, I think, be the response for that. Yes, yes, absolutely. Mean, that's true. I remember the Sunday where we said, I mean, Adrian, it's also like you sit down and say, okay, guys, we need to make sure that we get it, right? Okay, fine. We will have liquidity for the next few days. Okay, that's interesting. So what can we actually do? And my point is shooting 1.8 was 1.8. We could have shot 2.1. I mean, we could have done whatever. At that point in time, it seemed to be 1.8. We went through the door two weeks later. We were the first one approved, government backed and so on. And also don't underestimate the 1,800,000,000.0 does actually two things. The first thing it does, it locks in the banks. So the banks are at the table. Everything is good. The banks are there, KFW is there. So that's good. And also, I mean, in case we would need more, I think now things are at the table. So nobody knows. If it only comes back 30% in November and health makes loose or whatever, we will be taking care of it. I think the chance right now to secure additional money are better than securing at that Sunday, March 16. I have been in the room, Bergen has been in the room, many of the team members here have been in the room, interesting days, I tell you. So it's hindsight is easy. We could have said, we could have said, knowing that Lufthansa need nine, maybe we should have said three. So anyway, so water under the bridge. Destinations for summer, I would say if we open Majorca Canaries, if we open Greece, let's say, this week Cypress is smaller. But if we open the three, I'm happy. Okay. So we are not managing the company for P and L. We are managing the company cash for cash, remember. If this comes in, cash is not a problem. Now if it doesn't come in, then we will have discussions. But if it comes in, cash is not a problem. P and L will be maybe more difficult. But that's something when we rebook customers, we have enough volume to fill these destinations. And I think customers have enough flexibility just to go on vacation when it's safe. So it's good. It's maybe even better to open half of the destinations and fill everything than have the full destination and everything is still stopped. So we take it about we take whatever it is. But as soon as we can really start selling some of this year, the liquidity issue will be less of a problem because then immediately you have a flowing in working capital. And that's I think the most important thing. We take care about cost and P and L when it's appropriate, but now we take about the cash and that's the reason why it's important that it opens. Sailor and leaseback, of course, I mean, today Sailor and leaseback is nonsense, right, because you have distressed assets everywhere. So but we are preparing everything in order to be as soon as we have a little bit air under the wings, off we go. And then we have Kjati. Khamet is a good friend and long lasting business partner. I know him and his family, and he is trusting in the tourism business. He is trusting in Trui, And he knows us very, very well and the situation very, very well from all kind of aspects for a very long time. He is one of the longest lasting business partners. That he invested five percent is maybe not a bad sign. And therefore, also, I think also for KfW and for other people who have actually loans, if the equity side is not if the equity side is also moving, usually, it's also good for the bond side and for the backside, the loans. Perfect. Thanks for your words. Thank you. The next question comes from Christian Nedelcu from UBS. Please go ahead. Hi. Thank you very much for taking my question. Firstly, on liquidity overall, Could you tell us at the end of the summer, what's the comfortable level of liquidity for the businesses? On billion, is it more or less? Secondly, on the data that you are disclosing, it seems that net debt is gonna move to somewhere around 4,000,000,000 or bit above 4,000,000,000 by the June 11 when they're gonna restart operation. On a midterm, what's what's an acceptable level of financial leverage? So the net debt to EBITDA, what's the level you think is sustainable on a midterm? And lastly, looking at the the recovery overall, I think could you could you tell us a bit more what's the cash breakeven occupancy for your hotels or for your cruises? Or give us a bit of color how we should think of or take it on a recovery. And equally from the working capital point, what happens with all all these all the people that they've already paid the advanced the advanced payment? Do you start to assume at the beginning, they will be the ones that they will travel? So effectively, how how do you think about the lack of cash from, from that lack of cash coming in, new cash coming in? Thank you very much. Difficulties to understand everything Yes, about very hard. There was a lot of background noise. But on the additional debt, because that's also a question that I believe you asked. So it's as I said earlier, because I already talked about that, it depends on the travel opening scenario, of course. And as we indicated, we have a run rate cash out that is for fixed costs for customer refunds, etcetera, and some other small items and we indicated that also in the presentation. And this will lead naturally to an increased debt position, as Chris already said, but it depends on opening of travel. And of course, then we are proactively managing that, and we will we have a variety of options, and then we will address it in order to make sure that we have a healthy balance sheet going forward. That's about what I I I mean, that's what I can say about. Yeah. The other questions I could would like to answer, but I didn't understand them. I mean, so do we do we have an understanding? Apologies about the background noise. The question was what's the comfortable liquidity level at the end of the summer for a business like TUI that was Yes. Yes. Okay. No, I think the interesting thing is usually we have the summer positive swing and then winter negative. When your summer is more or less zero, the winter is very positive, right? So as soon as the business starts, even if it doesn't start and summer starts in winter, yes, you will have immediately cash inflow. So the liquidity is really only a problem until you have business, then actually it goes. Now on let me talk a little bit about debt, yes? And I think that I'm not a financial guy. I'm just the CEO. But how I see it, of course, we have now additional debt, yes? But we also have enforced two years of non dividends, right? That's very clear. So calculating €300.03 50,000,000 or whatever per year is 700,000,000 If you then say, Magalavy wanted to put anyway into if possible into the hapaglide with hapaglide into two equusis, that will delever, yes? When you think about possible rightsizing, assume for a moment just assume for a moment we had 15 aeroplanes left, yes, this would immediately not only save costs also delever the company significantly, right? I mean, therefore, I would not be too worried. It's not that we have done less business, but we will have oversupply of airplanes everywhere because definitely business travel will not happen. So I would we will have access to supply even if we rightsize the airline. So my personal view is if we look at our assets, if we don't invest into hotels like we have in the past because there's enough volume offer anyway, My view is our business is big enough to generate enough cash. I mean we just did a lot of investment in the last year because the business was growing so fast that investment was a good policy. But I think for the next two years or three years, we will not invest into hotels. We will invest into IT. We will not invest into hotels. We will not invest into ships. And we will, if possible, do as little as possible with Aerobench. So you will see much, much, much less investments. You will see no dividends. You will see a little bit of capital restructuring in our balance sheet. I'm absolutely as I said, I'm not a CFO, but from the CEO, it doesn't And what is cash burn on the Yes. Other That would be, let's say, around 35% to 40% of the total cash fixed cost per million that we indicated, I would say, currently. That's what we currently see. Thank you very much. And the next question comes from Alexander Kaczler from Barclays. Please go ahead. Yes. Hello. Thanks for having my question. Actually, I have a couple of questions, and then mostly basically of all the scenarios maybe you had in mind when you asked for the state guarantee. I mean, now we're a month two months later. And I'm just wondering where do you see yourself in these scenarios you anticipated? Are we now in the worst case scenario for you and the DKK 1,800,000,000.0 was basically still, yes, kind of like taking this into account? Or are we now in a situation which, it seems to be, yes, the business is worse off than anticipated? And then it would be great actually if you could also walk us through maybe how you see working capital in a ramp up now. If, for example, if travel resumes then in June, July, how this plays out for the next maybe two, three months? And then how you see the winter season looking like? Okay. So the first question was about liquidity and versus the initial case that we made with the resumption in June. There, we can clearly state that our liquidity position is better than what we originally planned. And that is I mean, that is good news. As to the scenarios, as you can imagine, it's difficult for me to disclose all the scenarios as we do not know when travel resumes. But we have various cases, of course, which would be not very sensible if we wouldn't. So we do have scenarios, but I cannot really go into the details of that. And then your last question was on the working capital inflow. And that is, of course, because it's you will see also a very large onetime effect because obviously currently, we don't have any revenues So then and your payables are, let's say, thirty to sixty days. On average, sixty is what we target for. So there you will see a onetime effect. And then of course, we also have the seasonal pattern as you have seen from that illustrative graph that you can even add to that. So that's why the working capital inflow once travel resumes is pretty significant. Okay. And then if I may, a follow-up actually on the Apple Glide acquisition. So I'm just wondering, the proceeds you expect are roughly EUR $650,000,000 now? Sure. And then on Page 21, you actually have a line item that is saying that the disposal group here of haplocoy cruises, there is a net debt position of $329,000,000. Is this correct? So this is the division of the company. Shut up. Yes. That is correct. Yes. So then the EV would be then basically this plus the €650,000,000 And the my question also is actually would then be the is there any cash in the Halbercloide group where you kind of have to fall maybe on the current liquidity. No, no, it's a net position. Yes. Maybe you can answer Wolfgang. The €600,000,000 is the cash inflow, clearly, debt leaves the group, and this is a net position. So we have to add this on top plus the equity we give in. And if you remember, we've been stating an enterprise value of one to 1.2. And if you deduct that, you come to that number. Okay. Understood. Brilliant. And then a last one, actually. Could you provide maybe a yes, a better granular overview of the capital structure, I'm sorry, at the moment, maybe by line item or so? How much is on the Riasia, the commercial purpose or other facilities? And how much basically of this is available. So basically, it's Yes. A split of capital structure and will follow-up on that with you. If that's fine, we'll do that immediately. Brilliant. Thank you. Thank you very much. And the next question comes from Mark Irwin from Tuohy. Please go ahead. Hi, good morning. I think that's me and Mark at Burton Port of Newton. Just two, hopefully, quick ones left, please. One on third party hotel and one on the MAX aircraft. Just on the hotel with the force majeure contract, what does that mean for the relationship with those partners? Have they generally accepted that the pain needs to be shared? Does it affect the ability for you to secure inventory with those partners for next season to December 21? Just a little bit about the force majeure would be helpful. And then the second question is just on the MAX aircraft. In light of your comments about becoming more asset light faster, how much flexibility is there on the downside with that framework agreement? Can you get out of it totally now that the world looks so different? Maybe just an update on the flexibility on that contract. Thank you. Okay. Max aircraft first. With Boeing, we are in discussions as you know and in good faith. I mean and they will resolve it, I'm pretty sure. The motivations on both sides are high. But we have less order book than we have aircraft in the fleet. So we have flexibility. So we can shrink the fleet, but we don't need to touch the order book. So I think we have enough flexibility. We need we will rightsize the airlines, but the order book might not be or will not be potentially affected. That's our today's position. Second point, hotels. Yes, we have payments which we don't give to hotels. Yes, that's true. And we have payments which we give to hotels. And the negotiation is very clear. We are an industry without revenue. Tough luck. You have been benefiting. Everybody has benefiting from a great industry and the vertical integration and so on and so on. And now we everybody has to contribute. But that said, it's a strong bond, and we will be able to negotiate mutual beneficial deals. And these mutual beneficial deals mean we pay less now and we actually, therefore, do commitments for future businesses and work together with the parties. And if we start up, they are considered specifically as core. And with some of our partners, we still have the prepayments. And we will actually make sure that the prepayments will be up and will be served first and the volume will be going there. I mean we are in this industry with most of these hotel partners for tens of years, if not fifty years. It is now one of the most unprecedented and maybe the most unprecedented crisis. And as we are in problems when we don't have revenues, our travel agencies are in problems. So the downstream business, the upstream business with our hotels are in problems. It's not like happy birthday party. Everybody can have wishes. We are actually into it together. Of course, we will make sure that our value chain is intact. So we will make sure that the hotels are not disappearing. So we are interested in a big offer. But at the same time, our first priority needs to be that the cash doesn't flow out just meaningless to hotels or meaningless to customers. This is each and every euro, each and every day, and it must be a good reason to pay. And the good reason is actually a past reason because we have done business, but it's also a future reason because we have a good agreement or we have a strategic alignment and so on and so on. And I think here, we are just doing a professional job. And by the way, I don't think very different from others as well. I mean so I have a feeling that we are getting along quite well. That's helpful. The next question comes from Oland Clark from Barclays. Please go ahead. Good morning. Thank you for taking my questions. Just two quick ones. There's a lot of attention in the travel industry on customer deposits and refund. Do you think that this could ultimately, in the future, we could be looking at the treatment of customer deposits by travel companies changing in some way, perhaps excluding this working capital? And then my second one is, hypothetically, the travel lockdown does continue through the summer. Is the communication line with KSW still open that you could turn to that as your primary solution and would you as your primary solution? Thank you. Okay. KFW is one of the options. That's clear. But not I mean there will be other options as well. And we need to we don't have the luxury not to look at options. So we will look at options. As I said, capital increases are maybe not the most efficient thing to do. But anyway, we will look at different options. If you ring fenced customer deposits, it would more or less destroy the industry. I mean the nature of the benefit of the industry is its positive working capital. And the positive working capital has been the engine of that industry because think about it, customers give money, we invest help with the hotels to invest into offers. The offers generate offers that in turn generates demand at lower prices and at lower supply, and therefore, it's a self fueling engine. And as long as the industry grows, it's beautiful because it's more and more fresh money. And as we believe, the industry will be growing fast. It has been growing, outgoing GDP in the last fifteen years. It is a beautiful model. And if you break it, if you ring fence it, right? So therefore, it's nobody's interest to ring fence customer deposits. What we do, we are securing customer deposits. And that's something which is also very special because there is no other consumer goods in the world which is actually secured as a prepayment of a customer, yes, in terms of the certainty customers have that they can get and demand their money back, yes. So I think the nature of the industry is actually nature of positive working capital. That's great. And the last question comes from Alex Brignall from Redburn. Please go ahead. Morning, guys. Just one last from me. On capacity plans, you're 35% booked. It'll be interesting to know what you have done to capacity since we last heard from you. And then within the current program that you have Oh, no. What is that? Sorry, Alex. I think I didn't get you. I think you said the capacity plan was 35% booked. That's understood. Yes. Okay. Maybe it's gone because now we lost him, I think. Or are we lost? Operator, can you say if we are lost or if Alex is lost? No, we are not lost. Just one second. I will get him back on the line. Now he's back on the line. Okay. Sorry, I'm not sure if you heard me the first time. You're 35% booked now. Could you tell us what your capacity plan has done since you last spoke to us? And then within your capacity plan, how much of it is your own capacity versus capacity that could be taken out with force majeure clauses that isn't sort of yours as it were? Thank you very much. For the 35%, it was largely committed. That's clear. Yes, the wholesale model is largely committed. So of course, we try now and we will get out of capacity as a force majeure and but also we will be focusing to serve our capacity or the capacity in Stavies first. But for the utmost important now, because it's again a P and L question, right, the utmost important is liquidity. So liquidity doesn't matter. I think in liquidity terms, we would be happy to wherever it opens. And let's assume for a moment we were average booked in all countries and in all destinations. If now Mallorca opened first, we would, of course, offer to everybody who is not Mallorca to go to Mallorca, right? So we will actually make sure that we fill as much as possible, yes, everything which is possible. I just want to maybe thank you very much for all your questions. And I think we need to close. I want to close the meeting with a very positive message I got from the wires. Obviously, the Minister for Internal in Germany has said the latest in June 15, he will open all borders. So let's see. I don't know. Hopefully, it's true or not, but I see that as a BPA ticker. I have them all the time on my phone. So if it's meaningful and if it's true and if it's not something which is fake news at the end of the day, that would be a good message as part of our half year results. Thank you very much for being tuned in. As I said, we take care of liquidity. We look that we don't have cash outflows. We look at that we get enough liquidity for actually the time that we don't have business. As soon as we have business liquidity, we'll immediately focus from the focus will go from liquidity to P and L. And that means limiting the damage of debt. And that's the question of how can we do profitable business, how can we actually make sure that the profit also in turn become cash again in order to limit the debt and we will refocus the business, save the cost, make it more lean and more digital. And the company will be a little bit different. And as Birgit said, we will be very, very, very disciplined on investments because not only we are disciplined because it's also not a good thing to do for the time when you have an oversupply. So it's a self fulfilling prophecy, if you like, as well. Thank you very much for being in the call and talk to you soon.