The Webjet Limited (ASX: WEB) share price is gripping the attention of the market on Wednesday.
Shares in the online travel booking company are rallying 10.96% into the green this morning, hitting $5.67 a share. The move follows the company's annual general meeting, held this morning.
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Bouncing back despite challenges
ASX travel shares represent one corner of the market that has been especially crippled by the impacts of the pandemic in recent years.
Fortunately, Webjet shareholders have been provided further reassurance this morning that profitability is still on track for recovery. In the company's AGM presentation, Webjet touted its improving financial and operational metrics.
Investors had already been informed earlier in the year that a return to profitability had been achieved during the second half ending March 2022. However, today's presentation solidified this trajectory by highlighting continued profitability so far in FY23. In turn, the Webjet share price is taking off today.
Webjet's management is expecting positive cash flow from operations to exceed $100 million in the first half of FY23. There are several positive indicators that have fed into this forecast across the various segments of the business, these include:
- Bookings through WebBeds above pre-pandemic levels since May this year
- August total transaction volume through WebBeds expected to surpass the record high
- Webjet total flights market share increasing 57% since the start of the pandemic
- Tourism returning to Australia and New Zealand to boost GoSee earnings
Despite the positives, the company's management remains privy to the headwinds. Webjet's chair Roger Sharp discussed the operating environment in his address, stating:
We continue to watch cash, cash flow, and debtor risk very closely, and are obviously tuned in to the global forces threatening prosperity — war in the Ukraine, high inflation driven by rapid increases in energy and food prices, a still-broken supply chain, and an on-again, off-again pandemic.
Flight path of the Webjet share price
The Webjet share price has been coasting through a prolonged patch of turbulence. Since the year kicked off, shares in the online travel agent have bounced between $4.60 and $6.15. However, the general trajectory has been downward since June.
Compared to a year ago, Webjet shares are down 2.6%. Meanwhile, fellow ASX travel share Flight Centre Travel Group Ltd (ASX: FLT) has gained 5.1% over the rocky period.
