Profiling the world’s top travel retailers

Dufry Group


2019 turnover

€8,138 million

2018 rank




Dufry’s blue-chip concessions helped it maintain its number one status last year (London Heathrow Terminal 2 pictured)

Dufry remains travel retail’s market leader based on 2019 performance, a status it has held for the last six years. The company posted a +1.9% rise in turnover for 2019 to CHF8,848.6 million (€8,138 million at the Euro exchange rate on 31 December), a result that was published in the shadow of the escalating COVID-19 crisis in early March.

By late April Dufry was planning for a “worst-case scenario” of a -70% fall in sales year-on-year in 2020, in which case it anticipated a return to 2019 business levels by 2022. In the event of a -50% fall in sales, business could recover by mid to late 2021, it said at the time, and a -40% fall in sales could result in a return to 2019 levels as soon as early 2021.

The company later outlined a programme aimed at reducing personnel expenses by between 20% and 35%, reflecting the varying scenarios above. A new organisational structure, effective from 1 September 2020, also aims to strengthen the airport retail business and other channels, driving profitability and growth acceleration, where possible.

Even as traffic returns in many markets worldwide, the gradual and uneven recovery make forecasting the rest of 2020 almost impossible, though Dufry will be fighting to make the most of what business there is in Q3, traditionally its strongest. How quickly consumers become attuned to the new world of air travel, and in what numbers, will dictate its performance in this key period – and where Dufry sits in these rankings next year.

For now, the message to the wider industry is for patience, perseverance and partnership, CEO Julián Díaz told Martin Moodie in a candid interview last month. Asked if Dufry had risked failure at any point during the crisis, Díaz replied: “No. I don’t think that the company has been in danger, even obviously though the uncertainty was very high – and still is very high.

Walk through or walk by: How consumers react to the new world of travel will help define these rankings in 2020 and beyond

“I am talking about during the last week of February, beginning of March, April, and May where the business really almost collapsed [in terms of sales]. The company has done what in this specific situation was required. Number one is to protect the liquidity. The use of cash was restricted as much as possible [with cash burn down to CHF75 million per month when normally it would be double that – Ed].

“The second part was to control and reduce the fixed part of the cost structure and we have reduced both.”

Asked for his message to supplier partners who are concerned about slow or even potential non-payments, Díaz said: “During this process we are obviously concerned that our partners – especially the suppliers, the brand owners of the business – will suffer too. What we have communicated, is that as soon as we have visibility – a certain visibility, not full visibility as the uncertainty is obviously still very high – we will contact them (as we have done) to elaborate a plan for reopening and for paying the amounts that are outstanding in the balance.

On how Dufry stands in terms of concession payment terms with its airport partners, Díaz said he expected minimum guarantees to be adapted to “reality of the situation” as the rate of reopenings accelerate.

“The problem is how long and how far you can agree today with landlords about MAGs in circumstances that are uncertain. This is the key challenge. The airports also want to put in place a plan that maximises the sustainability of the business model. The idea here is to renegotiate conditions that are sustainable for both parties.”

Sounding an upbeat note about the future of the industry, he said: “I am confident that travel retail is resilient, as is aviation, as is tourism. It’s part of the way we live. And I don’t think the world will change that much. People talk about the normality – the normality we know is the one we used to have and the one we deserve. Very soon that will return as people want to travel, they want to fly, and they will do so again.”

Dufry’s traditional defence against market fluctuations and crisis – its geographic diversity – has proved brittle in the face of a global pandemic. The industry giant remains in a difficult and complex situation, something reflected in its share price which has fallen from CHF97 in early January to just under CHF27 at time of publication. Will an outside player, private equity or even trade, see opportunity there in light of the ever stronger chances of a vaccine being developed in the relative short term?

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The Moodie Davitt eZine

Issue 281 | 16 July 2020

The Moodie Davitt eZine is published by The Moodie Davitt Report (Moodie International Ltd) every month.

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