Webjet Group has shrugged off weeks of acquisition speculation by mapping out a clear path to future growth as part of its latest financial results.
While soft trading conditions brought on by cost-of-living pressures served to somewhat dampen its results, CEO Katrina Barry was characteristically upbeat about the company’s future and its strategy to spur TTV, profits, and customer acquisition.
Key to lifting its sales and profit performance will be diversifying its appeal beyond being a domestic flight-led business.
In its five-year growth plan, Webjet OTA said it would chase more international flight bookings, targeting 25%-30% of the market beyond its current 20%.
While historically Webjet has deployed a flight-first model, it now wants to shift to a packaged hotel/flight approach, expanding its range and value of accommodation options.
The company will deploy focused marketing to boost member sign-up, loyalty benefits and bookings in order to fulfil this objective.
“We are up strongly up on member sign-ups for our hotel deals, and 28% of our package bookings are coming from first-time customers, who are incredibly valuable to us,” Webjet Group CEO Katrina Barry said during a conference call.
Another major growth pillar will be making corporate travel more tailored through a new stand-alone offering, enabling more seamless digital experiences through a structured approach to bookings.
Barry said there was plenty of growth to be pursued in the corporate space, and that Webjet had to be better at making the booking process more seamless and smooth to grow its marketshare.
Another update in the forward plan was about Webjet’s new loyalty program flagged in March, with confirmation it will be firmed up in the next year.
The loyalty program is viewed as a key piece in capturing more of the travellers’ wallet and boosting bookings, which will present customers with a much broader range of ancillary offers and member deals.
A major branding investment will also go ahead over the next year, and will be dedicated to creating more awareness about the new loyalty program and the value it offers members.
“With a clear plan to deliver significant growth by FY30 and renewed focus, we’re excited about the opportunities ahead and confident we are laying the foundation to drive meaningful and sustained value for our shareholders,” Barry said.
Looking at the financials now, and Webjet Group’s bookings dropped by 7% to 1.53 million for the year to 31 March compared to the prior 12 months.
Total transaction value for the group was down by 6% to $1.5 billion, and revenue also dipped by 3% to $139.7 million, however EBITDA managed to buck the broader financial trend and climb 1% to $39.4 million.
In the 12 months to 31 March, Webjet Group has managed to trim expenses by 10%, creating a healthy cash reserve of $118.1m and a debt-free balance sheet.
On a division-by-division basis, Webjet OTA delivered a slight decline in EBITDA, posting a result of $51.6 million, with a slide in domestic bookings offset by higher margins during the period.
Meanwhile, online vehicle rentals product GoSee appears to have been rebranded to Cars & Motorhomes, with the latest report referencing the division as “formerly GoSee”.
The brand saw its bookings shrink by 7% in the last period, however added functionality and more affiliates have it positioned for future growth, Webjet said.
The tool designed to make complex itineraries easier, Trip Ninja, continues to be a strategic asset and innovation engine within the group.
Over the past year, the platform has expanded its customer base, added three new travel intermediary partners, and launched a new analytics engine to uncover value in flight retailing.
Fully integrated across multi-stop searches on Webjet OTA, Trip Ninja is now being prepared for long-haul return journeys, which Webjet said it was hopeful of unlocking further margin and conversion opportunities.
The results arrive at time of high intrigue for Webjet Group, which has recently declined a takeover offer from BGH Capital.
As a result of the recent acquisition interest, the board has deferred the implementation of any capital management initiatives.
And while there will be no share dividends paid this time around, they are anticipated to kick back in for shareholders in FY26 through a distribution model of between 40%-60% of underlying net profit after tax.
