Webjet Limited (ASX: WEB) held its Annual General Meeting (AGM) on 21 November 2018 following which the share price of the company decreased by 1.777 percent. The chairman and the Managing Director both addressed the shareholders at the AGM.
While addressing the shareholders at AGM, the Chairman informed about the Companyâs strong growth across all metrics in FY 2018 and told that the companyâs B2C division has extended its position as the leading online travel agent in Australasia, with four-year CAGR of 21% in travel bookings (of which 15% was organic). In FY18 the Companyâs B2B division became the No.2 global B2B hotels business through a combination of strong organic growth and the acquisition of JacTravel. Recently, the company announced the acquisition of Destinations of the World for A$240 Mn plus earn-out. He further told that the company is keeping a relatively conservative balance sheet so that it is both relatively insulated against unforeseen conditions and have the capacity to pursue new opportunities as they come along.
While addressing the shareholders at the AGM, the Managing Director Mr. John Guscic highlighted the strong financial performance of the company and presented the outlook for FY 2019. In FY 2018, TTV and Revenues of the company were 54% higher than the prior year at $3 Bn and $291 Mn, respectively. The EBITDA from continuing operations increased by 71% to $87.4 million and the EBITDA margin increased by 303 bps to 30.0%. The NPAT of the company increased by 63 percent to $55.7 million in FY 2018. Mr. John also informed about the Acquisition of Destinations of The World (DOTW) and told that the company is anticipating revenue synergies of US$7 million which are expected to be achieved in full in FY 2020. He also informed that this Acquisition increases WebBeds' FY18 TTV by A$734 million with a combined FY18 TTV of A$2,088 million on a pro-forma basis.
While discussing the FY 2019 Outlook, Mr. John informed that the company is on track to deliver an underlying EBITDA of A$110 Mn for the existing Webjet businesses for FY 2019. Assuming the acquisition of DOTW closes on 22 November 2018, the company is expecting DOTW will contribute incremental EBITDA of around A$10 Mn in FY 2019. As per the current FY19 Outlook, the total expected FY 2019 EBITDA for the existing Webjet business and the 7-month contribution from DOTW is at least A$120 Mn, pre-synergies. The company is anticipating the cost synergies of US$3 Mn per annum, commencing in FY19, with full year impact in FY 2020.
In the last six months, the share price of the company decreased by 2.76 percent as on 20 November 2018. WEB Shares traded at $11.610 with a market capitalization of circa $1.51 billion as on 21 November 2018 (AEST 4:00 PM).
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