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Asia is the Most Important Growth Market

India, China/Hongkong – Market Region South Division

The Asia unit (which covers India and China/Hong Kong) recorded turnover of CHF 316 million (2009: CHF 267 million). This is 18.5 % higher than the previous year’s figure and also beats the record year of 2008 by 3.8 %. Operating earnings (EBIT) rose to CHF 42.2 million, compared with the CHF 25.9 million posted in 2009.

This clear improvement can be attributed to an increase in tour operating business as well as to growth at VFS Global (external consular services). Better margins and cost savings also contributed to the increased result. In 2010 the Asia unit was one of Kuoni Group’s most important sources of earnings.

India: VFS Global grows strongly

Turnover for the unit India for the year came to CHF 271 million (2009: CHF 229 million), a significant rise of 18.1 % on the previous year.

The tour operating business in India doubled the number of outlets in its country-wide retail network in 2010. Kuoni travel products are now available at 638 points of sale. The most popular holiday destination for Kuoni’s Indian customers in 2010 was Europe, followed by the USA and Australia. There was also a steady rise in bookings for South East Asian holiday destinations. During the year, Greece, Turkey and New Zealand emerged as new growth destinations. Within India, the most popular holiday spots included the Andaman and Havelock Islands.

Kuoni India is one of the leading providers of holiday travel to Europe, the USA and Australia. Kuoni India is one of the country’s top providers of business travel and won several awards. These included the Best Outbound Tour Operator award from the Travel Agents Association India (TAAI), and the Favourite Tour Operator / Travel Agency award from the Condé Nast Traveller Reader’s Travel Awards.

In the business travel sector (HRG Sita), the economic upswing in India led to further growth in turnover. Kuoni India is one of the country’s top three providers of business travel.

The most prominent driver of growth within the Asia unit in 2010 was VFS Global. The company expanded its services significantly all over the world during the year. VFS Global currently works on behalf of 33 governments through more than 370 offices in 48 countries. The company was founded in India in 2001, and has since grown to become one of the world’s leading providers of administrative services for visa applications at embassies and consulates.
The company, which has 1 794 employees, specialises in the external handling of the application processes that governments require to issue visas for travel to their countries. The company provides also modern technologies to fulfill countries biometrics data requirements.

The number of applications processed during the year was 17 % higher than in 2009. In 2010 VFS Global won a major contract from Denmark to process visa applications for its embassies in 13 countries. Japan issued an external contract for the first time, and VFS Global now processes applications for the Japanese Embassy in Thailand. Other new customers acquired by VFS Global include Finland, Norway, Hungary and Cyprus.

In 2010 it started to offer additional services for applicants. It now provides VIP lounges and SMS tracking services, for example.

VFS Global was awarded the IT Governance Award by the Information Systems Audit and Control Association.

China/Hongkong: first premium travel agency opened

During the year turnover increased to CHF 46 million (2009: CHF 38 million), primarily because of an increase in demand due to the economic recovery. At the same time, greater investment was made in marketing activities, which led to additional turnover from direct customers and business clients. Kuoni Hong Kong opened its first premium travel agency in 2010. By providing a new type of advisory experience, the agency is helping to boost direct customer contact and increase awareness of the Kuoni brand in Hong Kong.

The most popular holiday destinations for customers from China/Hong Kong during the year under review were Europe (Switzerland, Italy, Spain, Portugal, Russia), the Middle East, Africa, South America, and Asia (Vietnam, Cambodia, Malaysia). Holidays in China itself also sold particularly well.

At the start of June, Kuoni made a takeover offer for International Holdings Ltd. in Guangzhou (China). However, there was a lack of clarity among shareholders of GZL Guangzhou International Travel Services, a tour operator in which Et-china holds a stake and which is the main interest to Kuoni. Kuoni was not affected by this lack of clarity. Because of this unresolved situation, the takeover could not be made. With a 30 % stake Kuoni remains a major shareholder in Etchina and continues to participate in the growth of the important Chinese market. Kuoni’s acquisition strategy in Asia remains unchanged.