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Dufry beats sales estimates as global travel rebounds

FILE PHOTO: A duty free shop belonging the the Dufry group in a departure lounge at Denpassar international airport in Bali

By Anna Mackenzie and Tristan Chabba

(Reuters) - Swiss duty-free retailer Dufry on Tuesday reported stronger than expected sales for 2022, helped by a recovery in travel related volumes after pandemic lockdowns were lifted.

The retailer, which operates more than 2,200 shops at airports, on cruise liners, in seaports and other tourist locations, has been benefiting from the strong travel rebound especially in Europe and the United States.

Dufry's shares were up 2.7% at 1206 GMT, at the top of the Swiss mid-cap index.

"Reported numbers better than expected as travel recovery continued ahead of expectations," Vontobel analysts said in a note, also pointing to Dufry's "disproportionately low" exposure to China.

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Dufry expects a gradual uptick in China's international travel towards the second half of 2023. Chief Executive Xavier Rossinyol told Reuters the group would be "investing in Chinese travellers rather than China itself."

Turnover in the Asia-Pacific region jumped 149.3% in the fourth quarter from the same period in 2021, boosted by relaxation of travel restrictions, including in countries such as China and Indonesia.

Rossinyol also said that while he expected macro challenges like supply chain issues and travel restrictions to improve this year, inflationary pressures would be "slightly more challenging".

"We remain generally optimistic about the situation in 2023, while remaining vigilant about macroeconomic factors," he said.

Dufry, which is present in 75 countries, reported annual turnover of 6.88 billion Swiss francs ($7.40 billion), up 76.1% organically from a year earlier.

Like last year, Dufry did not propose a dividend for fiscal 2022, saying this would enable the company to focus on strengthening its financial position and on closing the ongoing business combination with Italy's Autogrill.

Dufry also confirmed its medium-term outlook for 2023-2027.

($1 = 0.9297 Swiss francs)

(Reporting by Anna Mackenzie and Tristan Chabba in Gdansk; Editing by Friederike Heine, Milla Nissi and Jane Merriman)