* European tourism data points to strong recovery
* Hotel bookings up, tourist spending in key centres rising
* Eurotunnel, Amadeus all report brighter outlook
* Analyst sentiment on sector improves
* Earnings revisions: http://reut.rs/2nd49S3
LONDON, March 10 (Reuters) - Tourists are heading back to
Europe, and the recovery is showing up in everything from rising
hotel bookings to tax-free shopping and air traffic, leading to
a brighter earnings outlook for travel and leisure companies.
A rebound in emerging markets is bringing visitors from
countries like China, Brazil and Russia to continental Europe,
while a weaker pound since Britain voted to leave the European
Union has boosted UK tourism. And despite the sagging pound,
travel from the UK also remains healthy, an HSBC survey showed.
"International travel both to and from emerging markets has
been growing, while average spend per trip has also been
increasing. For hotels, the revenue per available room has
improved in Europe and the UK," said Jeff Meys, head of
optimised portfolio strategies at NN Investment Partners.
The pan-European STOXX 600 travel and leisure sub-index
, which includes hoteliers, airlines, brewers and
bookmakers, is up 2 percent so far this year, after dropping 11
percent in 2016. Travel stocks have outperformed the
pan-European STOXX index over the past three months.
Security fears after attacks on Paris in January and
November 2015 and in Nice the following July dampened tourists'
appetite for France. That cost French hotels an estimated $675
million in lost revenue over 2016, the research firm MKG said in
But France saw tourist numbers grow in the fourth quarter,
figures from the national statistics agency showed, indicating a
return to health.
The improvement in travel was apparent in the latest
earnings at companies such as Spain's Amadeus, which
provides booking systems for airlines, and Eurostar operator
Merlin Entertainments, which runs London's Madame
Tussauds waxworks and more than 100 other attractions, said
earlier this month a weak pound was drawing tourists back to
London, reporting a jump in visitors from the EU in November and
The pound has fallen 11 percent against the euro and 17
percent against the U.S. dollar since Britain voted to leave the
European Union in June.
Luxury goods makers Prada, LVMH and Hugo Boss all cited
higher tourist spending and increased inflows from Asia in their
Analyst sentiment on earnings in the sector has improved
significantly from last year, Thomson Reuters data shows: http://reut.rs/2nd49S3
Tax-deductible shopping in Europe, a measure of tourist
spending, grew 21 percent in January, the second straight month
of growth after a year of decline, figures from Global Blue, a
tourism tax refund company, showed. An earlier-than-usual
Chinese New Year delivered a surge of Chinese visitors in late
January, Global Blue said.
Tax-free shopping in France grew 20 percent, while sales in
Italy and Germany rose for the first time in a year. Sales in
Britain grew 45 percent in January, with average spending also
increasing as tourists took advantage of the cheaper pound.
Europe's capitals vie for high-spending tourists. Spain's
capital Madrid is banking on developing its luxury shopping and
culture credentials to attract more high-spending Chinese
"It's been very much a tale of Spain and the periphery,
which are usually weak, but they have swung back very hard,"
said Jonathan Frearon, European equities manager at Standard
Increased air travel into and within Europe has also
underpinned investor enthusiasm for shares of companies that
operate airlines and airports in the region.
British Airways owner IAG reported increased
traffic for February, and budget airlines Easyjet and
Ryanair saw an increase in passengers of 8 to 10 percent
for the month compared to last year.
UBS analysts said it expected strong growth in the first
half of 2017 for the Spanish airport network of Aena,
the bank's preferred company in the airports sector.
Shares of Fraport, the operator of Frankfurt's
airport, are back to late 2015 highs. Along with prospects of
growth, the shares also offer a stable dividend, adding to their
attraction for investors looking to capture the revival in
European tourism and business travel.
(Reporting by Helen Reid, editing by Larry King)