In the course of the current financial year, further assets were reclassified to assets held for sale and disposal groups as well as the related liabilities, which resulted in disposals through divestments made in the first nine months of the current financial year. All assets and disposal groups classified as held for sale as at 30 September 2020 and the related liabilities were sold in the first nine months of financial year 2021. Please refer in particular to the section 'Divestments'. 


Assets held for sale 
 
? million                                           30 Jun 2021   30 Sep 2020 
Aircraft                                            -             42.4 
Investments accounted for using the equity method   379.3         13.1 
Other assets                                        12.4          1.7 
Total                                               391.7         57.2 14. Pension provisions and similar obligations

The pension provisions for unfunded plans and plans with underfunding increased by ?2.3m to ?1,017.3m compared to the end of the financial year.

The overfunding of funded pension plans reported in other non-financial assets decreased by ?184.8m to ?178.5m compared to 30 September 2020.

In the third quarter, the Trustees of the UK pension plans acquired insurance policies providing a reimbursement by insurers of the payments to be made for parts of the existing obligations. The insurer did not assume the obligation to fulfill the pension commitment in this transaction. Accordingly, the insured parts of the pension plan continue to be recognised in the balance sheet.

In order to settle the insurance premium, existing assets of the plan were sold. The difference in the valuation of an insurance policy compared to the assets sold resulted in a decrease in plan assets of ?174.2m, which was recognised directly in equity as a remeasurement effect. 15. Financial liabilities

Non-current financial liabilities rose by ?612.2m to ?4,304.0m as against 30 September 2020. This increase was primarily attributable to an increase in liabilities to banks of ?412.1m and from the placement of a convertible bond in April 2021 with a carrying amount of ?334,8m for the debt component. These increases are partially offset by other declines in liabilities from bonds of ?180.5m. This reflects the fact that TUI AG issued a warrant bond totalling ?150.0m on 1 October 2020 in the framework of the financing package from the German government, exclusively subscribed to by the WSF. While the bond component of the warrant bond is shown under financial liabilities, the warrants are recognised in equity. Meanwhile, TUI Senior Notes bond issued on 26 October 2016 with a nominal amount of ?300.0m was redeemed early on 23 February 2021.

The main financing instrument is a syndicated revolving credit facility (RCF) totalling ?4.6bn between TUI AG and the existing banking syndicate or KfW, respectively, which has joined the banking syndicate.

In addition, there is a separate syndicated revolving credit facility of ?200.0m.

As at 30 June 2021, the amounts drawn under the revolving credit facilities totalled ?3,188.1m.

As at 30 June 2021, current financial liabilities declined by ?302.4m to ?274.9m from ?577.3m as at 30 September 2020. The decrease results from a reduction in current liabilities to banks.

For more details on the terms and conditions of the credit lines provided by KfW and the placement of the convertible bond in April 2021, please refer to the section "Going Concern Reporting in accordance with the UK Corporate Governance Code". 16. Lease liabilities

Compared to 30 September 2020 the lease liabilities decreased by ?92.1m to ?3,307.8m. This decrease was due to repayments of ?554.8m. Furthermore, modifications and reassessments of existing lease contracts reduced the lease liabilities by ?52.8m. This decline is mainly due to contract amendments in the area of hotel and hotel capacity contracts. Offsetting effects were caused by the addition of new lease contracts of ?409.9m mainly relating to new aircraft, and to interest charges of ?112.7m. 17. Other financial liabilities

The other financial liabilities include touristic advance payments received for tours canceled because of COVID-19 restrictions of ?222.2m (as at 30 September 2020 ?351.0m), for which immediate cash refund options exist and which have to be repaid shortly if the customer opts for payment. Please see the following section for more details. 18. Touristic advance payments received

Apart from the immediate cash refund option in certain jurisdictions, TUI Group offers its customers voucher/refund credits for trips canceled because of the COVID-19 crisis. If these voucher/refund credits are not used for future bookings within a specified period, the customer is entitled to a refund of the voucher value. The entitlement to a refund of the voucher value represents a financial liability. Due to the high level of uncertainty regarding the further development of the COVID-19 crisis and customer behavior, it is not possible for TUI Group to reliably estimate the extent of utilization of the voucher/refund credits for future bookings. As at 30 June 2021 the touristic advance payments received include ?70.7m (as at 30 September 2020 ?184.8m) of advance payments for cancelled trips for which customers have received voucher/refund credits which may have to be refunded after a certain period of time. 19. Changes in equity

Overall, equity decreased by ?742.8m to ?-524.7m when compared to 30 September 2020.

In January 2021 TUI AG carried out a recapitalisation.

In connection with this recapitalisation, TUI Group's subscribed capital was reduced first. On a constant number of ?590.4m shares the nominal value per share of 2.56 ? was reduced to 1.00 ?. In effect the subscribed capital was reduced by ?919.0m. Subsequently a capital increase by cash contributions was carried out which led to an increase in subscribed capital in the amount of the nominal value of 1.00 ? per share, i.e. an increase of the subscribed capital of ?509.0m.

The above-named reduction of subscribed capital increased the capital reserve by ?919.0m. Furthermore the capital reserve was increased by the share premium of the capital increase of ?58.8m. The expenses of capital procurement incurred for the capital increase and the silent participation were offset against capital reserves in the amount of ?31.0m. Furthermore in October 2020 a corporate bond with option rights was issued to WSF. The value of option rights increased the capital reserve by ?34.5m.

In addition, an unsecured, unsubordinated convertible bond in the amount of ?400,0m was issued in the third quarter of the financial year 2021. The value of the conversion rights from this bond increased the capital reserve by ?62.5m. Ancillary costs of issuing the convertible bond in the amount of ?1.3m were offset against the capital reserve.

In the first nine months of the financial year 2021, two silent participations were issued to the WSF. In accordance with IAS 32 both silent participations are disclosed in equity. The first silent participation in the amount of ?420.0m was fully paid. It is convertible at any time, in whole or in part, into shares in TUI AG at a conversion price of ?1.00, provided that the participation of the WSF resulting from the conversion does not exceed 25% plus 1 share in TUI's share capital. The second silent participation is non-convertible. It amounts to ?671.0m and was fully paid in.

In the first nine months of the financial year 2021, TUI AG paid no dividend (previous year ?318.1m).

TUI Group's loss in the first nine months of the financial year 2021 is attributable to the COVID-19 crisis.

The proportion of gains and losses from hedging instruments for effective hedging of future cash flows includes an amount of ?92.9m (pre-tax) carried under other comprehensive income in equity outside profit and loss (previous year ?-277.6m).

The revaluation of pension obligations is also recognised in under other comprehensive income directly in equity without effect on profit and loss. 20. Financial instruments 


Carrying amounts and fair values according to classes and measurement categories according to IFRS 9 as at 30 Jun 2021 
 
                               Category according to IFRS 9 
                               At          Fair value with no       Fair value with no      Fair value     Fair value 
? million           Carrying   amortised   effect on profit and     effect on profit and    through        of financial 
                    amount     cost        loss without recycling   loss with recycling     profit and     instruments 
                                                                                            loss 
Assets 
Trade receivables 
and other           -          -           -                        -                       -              - 
receivables 
thereof 
instruments         672.2      672.2       -                        -                       -              671.6 
within the scope 
of IFRS 9 
thereof 
instruments         10.7       -           -                        -                       -              10.8 
within the scope 
of IFRS 16 
Derivative 
financial 
instruments 
Hedging             1.0        -           -                        1.0                     -              1.0 
transactions 
Other derivative 
financial           51.3       -           -                        -                       51.3           51.3 
instruments 
Other financial     21.8       13.6        6.1                      -                       2.1            21.8 
assets 
Cash and cash       1,524.4    1,524.4     -                        -                       -              1,524.4 
equivalents 
Liabilities 
Financial           4,578.9    4,578.9     -                        -                       -              4,581.7 
liabilities 
Trade payables      1,316.3    1,316.3     -                        -                       -              1,316.3 
Derivative 
financial 
instruments

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