Dufry shows discipline amid easing restrictions as Q1 turnover at -68%

By Luke Barras-hill |

Reported growth compared with Q1 2019 was down by 75.5% (-73.9% organic).

Dufry Group has identified ‘encouraging’ signs in the international travel recovery despite depressed passenger traffic at airports and other channels affecting a 68% (-66.7% organic) dive (yoy) in first quarter turnover to CHF 460.3 million/$494.5 million.

Like-for-like turnover was down -68.3% for the period in question versus 2020.

As of March 31, 2021, net debt amounted to CHF 3,621.1 million/$3,889.1 million.

In an earnings statement Dufry said the category mix reflects the current re-opening patterns, with domestic flights picking up more swiftly against continued cross-border travel restrictions in some geographies.

Julián Díaz, Chief Executive Officer,  Dufry Group: “Customer behaviour indicates continued demand for travel and travel retail, and we are well positioned to accelerate sales with further re-openings.”


As a result, the duty paid business has witnessed stronger demand with food, confectionery and convenience products yielding increased sales compared to 2019, supplemented by ‘elevated’ spend-per-passenger levels on a location-by-location basis.

Dufry said capex for Q1 2021 ‘remains in accordance with the recovery trajectory and in line with scenarios provided to the market with Dufry’s full-year results 2020’.

Julián Díaz, CEO of Dufry Group said: “We are seeing encouraging signs for resuming travel trends and shop re-openings in the regions that have most progressed with vaccination campaigns and have established cross-border travel protocols accompanied by clear procedures and necessary documentation for travellers.

“Customer behaviour indicates continued demand for travel and travel retail, and we are well positioned to accelerate sales with further re-openings.

“The close relationship with our landlords, suppliers, employees and shareholders continues to be a valuable support during the recovery. We are confirming the scenarios we have laid out for 2021 and are confident that we can achieve the targeted cost savings for the year.”

The travel retail giant opened 1,848sq m of gross retail space during Q1 2021, including units in Odessa, Ukraine; Porto Alegre, Brazil; at St Petersburg Pulkova Airport; and the first Hudson Nonstop concept backed by Amazon’s ‘Just Walk Out’ technology at Dallas Love Field Airport.

In January, Dufry opened its first store on Hainan island at Haikou’s Mova Mall Global Duty Free Plaza following a cooperation agreement with Hainan Development Holdings.

The move builds on Dufry’s existing strategic partnership with Alibaba Group to operate offline and online travel retail doors throughout China.

Click to enlarge. Source: Dufry Q1 2021 Trading Update.

A total of 2,100sq m of retail space was refurbished in Q1 with work at Rio Galeão Dufry Shopping Megastore among the projects.

In addition, Dufry secured several concession victories due to come onboard through 2021.

As exclusively revealed, Sangster Airport in Jamaica’s Montego Bay awarded Dufry a licence to operate duty free and duty paid operations in a development that will increase the current footprint to 2,260sq m.

Dufry also consolidated its presence in the UK with a new 12-year concession contract to run a 173sq m walkthrough shop at Teeside International Airport.

The Swiss travel retailer at present runs duty free shops at 25 airports across the UK.


Correct as of the end of April, CHF 1,619.9 million of debt has been refinanced with upcoming maturities until 2023.

The company states it is on track to achieve savings of CHF 530-670 million compared to 2019 spanning personnel and other expenses for full-year 2021.

Click to enlarge. Source: Dufry Q1 2021 Trading Update.

It adds that it has negotiated minimum annual guarantee relief for 2021 worth around CHF 300 million.

Financial prudence has been exercised using a combination of convertible bonds, senior notes and bank debt to optimise the current, challenging market conditions.

This includes a CHF 500 million issuance of new convertible bonds due 2026 and the conversion of its existing CHF350 million 2023 convertible bonds.

Maturities for remaining term loans have been extended to 2024 and Dufry has received an extension to its covenant holiday until June 2022.

“The further strengthened financial profile adds to the significant achievements realised in 2020 with respect to the implementation of recurring cost savings of CHF 400 million, tight cash flow management and several financial initiatives to safeguard liquidity,” continued Díaz.

“We currently see progress on the re-openings in the US and Central America, and on plans communicated by authorities globally for collaboration on cross-border travel. The new organisational setup and strong liquidity position allows us to drive the recovery, while also engaging in strategic partnerships and opportunities to accelerate growth.”


On a regional basis, turnover for the Europe, Middle East and Africa division took the heaviest hit at -79.2% (-78.9% organic) to CHF 134.5 million in Q1 year-on-year, echoing the performance of Q4 2020, due to ongoing travel restrictions and quarantine measures [although Dufry will no doubt be buoyed by developments this week that EU member states have agreed to a European Commission proposal to welcome fully vaccinated travellers from non-EU countries to the bloc– Ed].

The UK, Central and Southern Europe particularly suffered, whereas Eastern Europe, the Middle East and Africa remained less affected.

Turnover for Asia Pacific dropped by 75.8% (-75.5% organic) to CHF 24.3 million, again due to the region’s high dependency on international traffic volumes.

Click to enlarge. Source: Dufry Q1 2021 Trading Update.

With some exceptions, the majority of Dufry’s shops in Asia Pacific locations remained closed at the end of the quarter.

However, China is recovering more strongly in the region evidenced by Dufry’s aforementioned collaboration with Alibaba Group and Hainan Development Holdings in Hainan benefitted from the first phase unveiling of the 3,000 sq m shop at the Mova Mall downtown store.

Around 39,000sq m of retail space will be open for travellers to the mall from 2022.

Meanwhile, in the *The Americas turnover fell by 62.6% (-59.9% organic) to CHF 241.2 million

Since the end of March the US has witnessed an uptick in domestic and intra-regional travel activity thanks to vaccine deployments and the easing of travel restrictions.

Turnover was driven strongly by Hudson’s duty paid offerings during Q1. Central America and the Caribbean, including Mexico, Dominican Republic and the Caribbean Islands, returned a more robust performance compared with other regions, driven by intra-regional travel from the US and a more flexible international travel regime.

South America’s performance was impacted by the pandemic and related new lockdowns in Brazil, though this was partly mitigated by eased restrictions in countries such as Peru.

Click to enlarge. Source: Dufry Q1 2021 Trading Update.

As reported, Dufry continues to re-open businesses in line with ‘single-location productivity scenarios’.

Correct as of the end of April, more than 1,400 shops globally were open, accounting for approximately 70% in sales capacity compared to full-year 2019.

For the month, Dufry estimates organic growth (based on net sales) to have reached -70.5% compared to the same month in 2019.

On a channel basis, Dufry’s net sales across cruise liners and seaports in  Q1 2021 versus the same period in 2019 plummeted by 89.9%, followed by airports (-77.9%), border, downtown and hotel shops (-63.6%) and railway stations and other stores (-35.1%).

At the end of May, Dufry expects to operate around 65% of shops, equating to close to 75% of sales capacity.

“Based on the already successfully implemented measures taken in 2020, the recent refinancing and the continued focus on cost savings, cash flow management and liquidity preservation, Dufry expects to be well positioned during the reopening while in parallel engaging in strategic initiatives and driving growth acceleration during the recovery,” added the company.

*As reported, Dufry retrospectively merged its North America and Central & South America operations to form the new reporting segment ‘The Americas’. This took effect in January and followed the re-acquisition and delisting of Hudson.

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