The Webjet Limited (ASX: WEB) share price has jumped 13% to $11.70 this morning following the release of the online travel agent's half-year results.
For the six months ended December 31, Webjet delivered total transaction value (TTV) of $1,443 million, up 55% on the prior corresponding period. From this TTV Webjet achieved total revenue (excluding revenue as principal) of $131.9 million and earnings before interest, tax, depreciation, and amortisation (EBITDA) from continuing operations of $41 million. This was a 52% and 63% increase, respectively, on the prior corresponding period.
On the bottom line net profit after tax before acquisition amortisation from continuing operations came in 45% higher at $23.8 million, including acquisition amortisation net profit after tax was up 25% to $20 million. On a diluted per share basis, earnings came in at 17.7 cents.
The key driver of this strong result was the company's business-to-business (B2B) or WebBeds segment. It achieved bookings growth of 227% and TTV growth of 168% during the period. This ultimately led to a 170% increase in segment revenue to $49.4 million and a 1378% lift in segment EBITDA to $12.8 million.
Webjet's business-to-consumer (B2C) segment turned in a solid but unspectacular half. Bookings grew 12% on the prior corresponding period and TTV was up 17%. This led to segment revenue jumping 21% to $82.4 million and segment EBITDA rising 15% to $31.8 million. Segment operating costs rose quicker than revenue during the half.
Management believes that this strong form can continue in the second-half and has advised that Janauary B2C and B2B bookings are up 10% and 280%, respectively, on the prior corresponding period. As a result, second-half TTV, bookings, and EBITDA are all expected to be higher than in the first-half.
This puts the company on track to achieve its FY 2018 guidance of more than $3 billion in TTV and EBITDA guidance of at least $80 million inclusive of JacTravel acquisition costs.
Should you invest?
There are a lot of quality shares to choose from in the travel agent industry such as Corporate Travel Management Ltd (ASX: CTD), Flight Centre Travel Group Ltd (ASX: FLT), and Helloworld Travel Ltd (ASX: HLO), but I would argue that Webjet is the pick of the bunch at the current share price.
Overall, I think this result and its guidance demonstrates why it could be a great option for investors willing to make a long-term buy and hold investment.
