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Helloworld released its full-year results yesterday, getting in ahead of the travel herd – with Qantas, Flight Centre and Webjet among companies due to release their results today.

Helloworld reported an impressive lift in profit after income tax, up 23.8% from the previous year to reach AUD 38.2 million. The company also revealed that its retail network had expanded to 2447 members (as at 30 June 2019) – a total which includes the opening 30 new Helloworld Travel branded agencies across Australia and New Zealand.

Other points of interest in the Helloworld result:

  • Total Transaction Value (TTV) growth of 9.1% to AUD 6.5 billion and revenue growth of AUD 31.9 million (9.8%) to AUD 357.6 million “led by business expansion and solid trading performances from existing operations”.
  • Earnings before interest expense, tax, depreciation and amortisation (EBITDA) of AUD 77.3 million, an increase of AUD 13.3 million (20.8%) compared with the prior year. Profitable growth initiatives delivered improved EBITDA margin of 21.6%, an increase of 1.9% compared with the prior year.
  • Basic earnings of 31.5 cents per share, an increase of 5.4 cents per share (20.7%) compared with the prior year.
  • Final dividend declared of 12.5 cents per share, bringing the total declared dividends for FY19 to 20.5 cents per share, an increase of 13.9% compared with the prior year.

Key achievements in FY19 included:

  • Retail network expansion to 2447 members as at 30 June 2019 including opening 30 new Helloworld Travel branded agencies across Australia and New Zealand.
  • Accelerating Helloworld Travel’s brand presence in Australia and New Zealand via consumer advertising and strategic partnerships including the launch of the Helloworld TV show and platinum media partnership with News Corporation.
  • Acquisitions of the Show Group business in Australia and Williment Travel Group in New Zealand complementing and enhancing the existing Helloworld Travel portfolio.
  • Strong full year contribution from the Magellan Travel Group.
  • Increased investment in the development of enhanced technology solutions, network expansion and marketing initiatives.
  • Two-year extension for providing travel management services to the Whole of Australian Government.
  • Reappointed for five years to the panel that provides travel management services to New Zealand All of Government.
  • Over AUD 50 million TTV secured in new corporate account wins including the South Australian Government and Australia Post.

In a statement issued to coincide with the results, Helloworld Travel said it had maintained its commitment to focus on strategically growing the business and its networks at profitable margins, whilst at the same time increasing investment in its brands, products, technology and people to ensure the Group is well positioned to deliver sustainable long-term growth”.

The Australian segment generated TTV of AUD 5574.1 million, an increase of 10% driven by strong growth from the enlarged business and increased product offerings. Revenue grew by 13.2% “led by the expansion in the retail division, improved margins driven by increased network sales through preferred partners and a focus on profitable revenue streams”.

The New Zealand segment generated TTV of AUD 851.9 million, an increase of 6% compared with the prior year “reflecting the expanded retail network footprint. Revenue increased by 3.5% from increased sales volume and improved margin outcomes”.

The Rest of World segment was the exception. It recorded TTV and revenue below the previous year “primarily reflecting challenging market conditions for the USA wholesale and Insider Journeys businesses”. The segment generated EBITDA of AUD 0.8 million, “with operating losses of Insider Journeys and USA wholesale being offset by the AUD 2 million profit on sale of the Insider Journeys business and operating profits from our Fijian businesses”.

Helloworld stated it continued to focus on improving the USA wholesale business, “including cost rationalisation where appropriate to ensure future profitability”. On 30 June 2019, Helloworld Travel sold its Insider Journeys business for a total consideration of AUD 2.4 million. Insider Journeys was not considered core to Helloworld Travel’s operations, nor its future business direction.

Edited by Peter Needham