The Webjet Limited (ASX: WEB) share price will be on watch on Thursday.
This follows the release of the online travel agent's full-year results.
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Webjet share price on watch following results release
- Total transaction value (TTV) up 261% to $1,638 million
- Revenue up 258% to $138 million
- Operating expenses up 61% to $153 million
- EBITDA loss improved by $41.3 million to $15 million
- Statutory net loss of $85.4 million (underlying loss of $38.4 million)
- Returned to profit during the second half
What happened during FY 2022?
For the 12 months ended 31 March, Webjet reported a 261% increase in TTV to $1,638 million. This comprises WebBeds TTV of $1,101 million and Webjet OTA TTV of $428 million, and GoSee (Online Republic) TTV of $108 million.
Things were equally strong for its revenue, which jumped 258% to $138 million. This reflects WebBeds revenue of $85.6 million and Webjet OTA revenue of $41.9 million, and GoSee revenue of $10.5 million.
Though, as strong as this growth was, it is still some way behind pre-COVID levels. For example, during calendar year 2019, WebBeds revenue was $226.9 million, Webjet OTA revenue was $151.1 million, and GoSee revenue was $30.8 million.
On the bottom line, Webjet reported another loss for FY 2022. On a statutory basis the company's loss was $85.4 million and an underlying basis its loss was $38.4 million. However, both are big improvements on the prior corresponding period.
Pleasingly, this appears to be the end of its losses. Management revealed that the company was profitable during the second half and delivered positive cash flow.
Management commentary
Webjet's Managing Director, John Guscic, was pleased with the progress the company made in FY 2022. He said:
FY22 was a year of recovery. We are now cash flow positive, our two largest businesses returned to profitability and we are seeing markets rebound strongly as travel restrictions continue to ease. WebBeds returned to profitability in the second half.
Our investment in North America is paying off with booking volumes for that business now already more than double what they were pre-pandemic, and all the work undertaken to drive efficiencies saw costs remain significantly below pre-pandemic levels.
Mr Guscic was also pleased to report that the Webjet OTA business was profitable despite facing very tough trading conditions.
Webjet OTA was profitable for the full year despite widespread lockdowns, border closures and the impact of Omicron from December. Domestic bookings spiked as borders opened, reflecting Webjet OTA's strength in servicing the domestic leisure market, however international bookings have been subdued with airline capacity still well below pre-pandemic levels.
Profitability for GoSee is highly linked to Australian and New Zealand international border openings and that business continued to be impacted by border closures for the majority of FY22, although we saw Cars TTV exceed pre-pandemic levels in March driven by domestic markets.
The year has also been one of incredible and unprecedented industry challenges consequent upon the chaotic changes in travel plans and restrictions which have put all travel industry service levels under enormous stress.
Outlook
While the company won't be providing any guidance for FY 2023, it appears confident on its prospects. Management notes that there are strong signs of demand and first quarter trading is tracking well ahead of the fourth quarter of FY 2022.
Based on current bookings trajectory, the company remains on track of be back at pre-pandemic bookings volumes by October 2022 to March 2023.
Despite this positive outlook, Webjet elected not to pay a dividend this year. Webjet's Chair, Roger Sharp, said:
While Webjet has significant cash reserves, we continue to watch cash, cash flow and debtor risk very closely. We are starting to see strong cash inflows as major travel markets open again, and the Company is back to being cash flow positive. We paid the deferred FY20 interim dividend during the year however given the inherent uncertainty that still remains, we have not declared a dividend for FY22.
