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Date : 17/05/2022

Webjet (ASX: WEB) is announcing FY2021 results next week. What to expect?

Webjet Limited (ASX: WEB) operates in the travel industry and provides services in consumer and wholesale markets. It is a global digital travel giant having first place in Australia and New Zealand as an online travel agency or briefly known as OTA. The company holds a 50% market of the entire OTA flights in Australia and New Zealand. The company is based in Melbourne, Australia.

The company operates in different divisions like B2B and B2C business models. The company’s other subsidiaries include WebBeds and GoSee. WebBeds is an online hotel room booking service providing company, while GoSee is a rental car and motorhome booking providing company.

The company is expected to release its full 2022 results next week. Webjet has managed to reduce its losses in 1H22 due to the impact of covid-19. Investors are expecting a steady growth in profitability in fiscal 2022.

WEB: First-Half 2022 Key Financials

WEB stock is currently trading at $5.30 and has given a return of more than 16% in the previous 12-months. The market cap of the company is around $2.02 Billion.

webjet limited asx

  1. In the first half of 2022, its revenue was around $55.4 million, increasing by more than 145% from the same period last year. The revenue in the first half of 2021 was around $22.6 million. It shows a clear sign of the company’s recovery from the blow of the covid-19 pandemic.
  2. EBITDA was ($15.8 million) in 1H22, improving by 61% from the EBITDA of ($40.1 million).
  3. The company’s loss was around $61 million and improved by more than 53%. Previously, its loss was around $132.2 million.
  4. Its basic and diluted loss per share was around 16.4 cents. Previously, it was 39 cents.
  5. As of September 20, 2021, the company had cash and cash equivalents of $446.1 million. Senior Unsecured Convertible Notes (Senior 2021 Notes) were issued in April 2021 and thus bolstered the company’s balance sheet.

What to expect in the upcoming FY22 results?

Webjet did not provide any guidance for the second half of fiscal 2022. But analysts expect an EBITDA in the range of $15 million. This does not seem to be in accordance with the company’s previous performance, but as the travel industry is recovering, it is welcoming that the company is recovering.

Also, due to substantial financial losses in the previous periods, the company didn’t issue any dividends. Although the company regularly shares 50-60% of its earnings as dividends, there is a high chance that it may not pay a dividend this year due to financial pressures.

WEB: Important Events in the First Half of 2022

An agreement between the company and one of its key lenders has been reached to convert $43.3 million in term debt (out of the total $86.7 million term debt) to a Revolving Credit Facility in November 2021.

In November 2021, the company agreed to buy 100% of Trip Ninja Inc., a Canadian travel technology firm.

Aside from the continuing effects of COVID, nothing has happened since the end of the financial six-month period that has or could have a significant impact on the operations of the Consolidated Entity, the results of those operations, or the state of affairs of the Group in future periods.

Conclusion

Webjet has been under financial pressure due to the covid-19 pandemic. The industry is recovering, and the company has seen tremendous growth in revenue in the first half. The full-year results should reflect a positive impact on the financial statements. Webjet has not given any hints about this year’s dividends, and it’s worth noting that Webjet’s board have not declared any dividends in the first half of 2022 either.

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