)
The demerged travel operations of Webjet Group (ASX: WJL) have managed to eke out a marginal increase in earnings in the first half of FY25, despite a fall in revenue precipitated by weakness in domestic air travel led by the collapse of Rex Airlines.
The latest result from Webjet Group, which is now a separate entity from business-to-business travel industry operator Web Travel Group (ASX: WEB), reflects a challenging domestic travel market that CEO Katrina Barry says is being impacted by a “slow” Australian economy.
Webjet Group, which announced its earnings ahead of Web Travel Group tomorrow, has reported an 8 per cent decrease in total transaction volumes to $752 million for the six months to the end of September.
However, underlying revenue only fell 1 per cent to $72 million as the group focused on higher margin products.
Webjet posted net profit after tax of $9.2 million for the half-year, up from $9 million a year earlier.
Barry says the latest result is “very pleasing” in the context of a “challenged broader Australasian economy”.
Among the highlights for the period, Barry notes the successful demerger from Web Travel Group and the establishment of Webjet Group as a stand-alone ASX listed company.
“Our focus has been setting ourselves up for and laying the foundations for accelerating growth in the next few years,” she says.
Webjet Group’s businesses comprise the Webjet OTA (online travel agency) divisions, GoSee, a car and motorhome rental platform, and Trip Ninja, a travel technology business that helps travel companies improve their booking systems.
Web Travel Group largely comprises the WebBeds business, a business-to-business platform that provides distribution solutions to wholesale customers.
Webjet faced a number of challenges during the latest half year with the Webjet OTA bookings hit by the administration of Rex Airlines impacting domestic leisure travel volumes. But a push into higher margin products led to marginal gains in revenue and EBITDA for the division.
“The Webjet OTA team has thus once again done an excellent job targeting higher revenue margin opportunities, selling more ancillaries to our customers and increasing international flight bookings,” says Barry.
“As a result, revenue per booking is now higher than it was pre-pandemic. Combined with the ongoing focus on cost control we have been able to increase Webjet OTA’s profitability.”
The group says GoSee faced a tougher time with car bookings down in line with subdued domestic flights, while motorhome rentals are lower due to a fall in long-haul inbound tourism and higher prices.
“We have identified opportunities to further simplify and streamline that business whilst maintaining our clear customer focus,” says Barry.
“Restructuring is now under way and expected to deliver about $4 million annualised cost savings, with $1 million in 2H25.”
Webjet says that Trip Ninja continues to deliver value for Webjet OTA while exploring its own international opportunities.
“Looking forward, the macro-economic environment continues to be challenging and given our brands are consumer facing, Webjet Group will not be immune,” says Barry.
“However, we remain optimistic on the broader medium-term outlook. As outlined in our demerger investor presentation, we have clear and robust strategic priorities to deliver growth and enhance our leadership positions in online travel marketplaces.”
)
