Webjet Limited (ASX: WEB) shares are falling on Wednesday morning.
At the time of writing, the online travel company's shares are down 3% to $6.39.
This follows the release of Webjet's half-year results.
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Webjet shares fall on half-year results
- Bookings up 27% to 4.265 million
- Total transaction value (TTV) up 35% to $2,898 million
- Revenue up 39% to $244.5 million
- Underlying EBITDA up 41% to $102.1 million
- Underlying net profit after tax up 120% to $70.7 million
What happened during the half?
For the six months ended 30 September, Webjet reported a 39% lift in revenue to $244.5 million.
This reflects a 50% jump in WebBeds revenue to $171.8 million, an 18% lift in Webjet OTA revenue to $61.2 million, and a 17% increase in GoSee revenue to $11.1 million.
Growing at an even quicker rate was the company's EBITDA, which came in 41% higher than the prior corresponding period at $102.1 million. The key WebBeds business was the main driver of this thanks to a significant increase in booking volumes and EBITDA margins above 52%.
On the bottom line, Webjet reported an underlying net profit after tax of $70.7 million. This was more than double what was recorded in the prior corresponding period.
However, despite this profit growth and its cash balance of $634 million, the Webjet board has not yet reinstated its dividend. This could have disappointed some investors today.
Management commentary
Webjet's managing director, John Guscic, was pleased with the half and believes it reflects the company's successful post-COVID transformation. He said:
Bookings, TTV, Revenue and EBITDA for the Group were all materially ahead of the prior period, driven by the outstanding performance of our WebBeds business.
WebBeds Bookings, TTV, Revenue and EBITDA were all significantly ahead of both 1H23 and pre-pandemic levels, reflecting the transformation work we undertook when the pandemic hit to capture growth as travel returned. We've broadened our distribution base, expanded our global presence and introduced new product innovations. As a result, we are now selling more product to more customers in more geographies, all while being more efficient and delivering best-in-class EBITDA margins.
Outlook
Guscic has provided guidance for the full year, revealing that he expects group EBITDA to be $180 million to $190 million in FY 2024. This is up from $134.8 million in FY 2023. He said:
The global economy remains uncertain but global demand for travel remains resilient and notwithstanding the current geo-political issues, we expect FY24 EBITDA to significantly exceed pre-pandemic levels. We expect FY24 EBITDA to be between $180 million and $190 million – 14% to 20% ahead of CY19 (ie pre-pandemic) levels.
While this will be a 33.5% to 41% increase year on year, the top end is a little short of Goldman Sachs' estimate of $191.6 million. This may also explain why Webjet shares are dropping today.
