Release Date: November 26, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Webjet Group Ltd (ASX:WJL) reported a strong financial outcome with a $100 million cash balance, providing flexibility for growth.
• Revenue per booking has increased to $96, surpassing pre-pandemic levels, due to strategic focus on revenue optimization and international bookings.
• The company has successfully increased the share of international bookings from 15% pre-COVID to 20%, driven by falling ticket prices and increased market capacity.
• Member-only campaigns have shown promising results, with a 250% increase in signups and a 100% increase in logins, enhancing customer loyalty and reducing marketing acquisition costs.
• Webjet Group Ltd (ASX:WJL) has a strong balance sheet with no debt and a net cash position of over $100 million, allowing for potential acquisitions and strategic investments.

Negative Points

• The Go See division has underperformed, with bookings and TTV down due to softening domestic flight demand and slow recovery in motorhome volumes.
• The company faces challenges in the domestic market with increased competition and higher average booking values, impacting domestic demand.
• Trip Ninja, a key technology investment, reported a loss due to higher headcount costs and slower than expected onboarding of new customers.
• Despite positive trading weeks, the macroeconomic environment remains subdued, with no expected rate cuts, potentially impacting future growth.
• The company has made significant cost-cutting measures in the Go See division, including staff reductions, to achieve $4 million in annualized operational expense savings.

Q & A Highlights

• Warning! GuruFocus has detected 1 Warning Sign with ASX:WJL.

Q: What are the trends in TTV and bookings for the early part of the half? A: TTV is up, and bookings are slightly up for the first six to seven weeks of the half. This is a positive start, and the company is optimistic about the trends in TTV, revenue, and bookings. (Respondent: Unidentified_1)

Q: How is Webjet Group considering acquisitions given its strong cash position? A: The company is open to both organic and inorganic growth opportunities. They have a playbook for acquisitions that are strategically aligned and accretive, leveraging their strategic assets. The strong balance sheet supports this growth agenda. (Respondent: Unidentified_1)

Q: What is the outlook for marketing spend in relation to the brand refresh? A: The company plans a brand refresh in the first half of the next calendar year, with some additional marketing dollars allocated. The impact will likely be more significant in the first half of FY26, with some effects in the second half of FY25. (Respondent: Unidentified_1)

Q: Can you comment on market share movements for domestic and international bookings? A: The company is focusing on its own growth rather than market share data, which is not fully representative. They are the dominant OTA player and are concentrating on growing their total bookings and revenue extraction. (Respondent: Unidentified_1)

Q: What is the strategy for international bookings, and what growth is expected? A: The focus is on growing international bookings as a key growth pillar. The company expects this segment to become a larger proportion of the total booking pie, driven by increased competition and falling airfares. (Respondent: Unidentified_1)

For the complete transcript of the earnings call, please refer to the full earnings call transcript.