Travelzoo · NASDAQ:TZOO
Travelzoo — Q3 2022 Earnings Presentation
20 slides from Travelzoo's earnings presentation, Oct 26, 2022
Slide 1: Third Quarter 2022 Performance
NASDAQ: TZOO Third Quarter 2022 Performance October 26, 2022
Slide 2: Important Notice to Investors
Important Notice to Investors Please read this management presentation together with the Company’s press release issued earlier today announcing the Company’s third quarter 2022 financial results and in conjunction with the Company’s recent Annual Report and Quarterly Reports as filed with the Secur
Slide 3: Part 1: Third Quarter 2022 Performance; Part 2: Management Focus; Part 3: Travelzoo META
Part 1: Third Quarter 2022 Performance Part 2: Management Focus Part 3: Travelzoo META 2 | Third Quarter 2022 Performance
Slide 4: Q3 revenues were lower than expected due to the unique travel situation
Q3 revenues were lower than expected due to the unique travel situation in the summer of 2022: The demand curve temporarily shifted. Financial Performance Revenue Operating Profit/(Loss) Members $ millions $ millions 30.3 30.7 30.5 25.5 16.7* 15.7 15.8 1.2 0.3 (0.3) Q3 2019** Q3 2021 Q3 2022 Q3 2019
Slide 5: North America segment revenue increased 9% year-over-year
North America segment revenue increased 9% year-over-year. At constant currencies, Europe segment revenue increased 2% year-over-year. North America Business Segment Europe Business Segment Revenue $ millions Q3 2021 9.7 5.2 Q3 2022 10.5 4.5 Q3 2022 at constant FX 10.5 5.4 Operating Profit/(Loss) $
Slide 6: Non-GAAP operating profit was $1.1 million
Non-GAAP operating profit was $1.1 million. Non-GAAP Operating Profit* GAAP Operating Profit $ millions Adjustments Non-GAAP Operating Profit* 2.6 1.3 1.1 0.3 0.8 1.1 (0.3) Q3 2021 Q3 2022 * GAAP operating profit + amortization of intangibles + stock option expenses + severance-related expenses = no
Slide 7: Items excluded in the calculation of non-GAAP operating profit
Items excluded in the calculation of non-GAAP operating profit: $ millions Q3 2021 Q3 2022 Adjustments 1.3 0.8 Impairment of intangibles and goodwill Amortization of intangibles 0.3 0.4 Stock option expense 0.9 0.3 Severance-related expenses 0.1 0.1 6 | Third Quarter 2022 Performance
Slide 8: Our cash balance reached the expected level
Our cash balance reached the expected level as the number of vouchers outstanding has become smaller. Cash Balance at End of Quarter* $ millions 66.4 26.7 20.5 Q3 2021 Q2 2022 Q3 2022 * Includes cash, cash equivalents and restricted cash 7 | Third Quarter 2022 Performance
Slide 9: North America business segment revenue
North America business segment revenue: North America Revenue by Type $ millions YOY % YOY %* change change 10.5 10.5 (as reported) (constant F/X) 9.7 0.8 0.8 7% 7% 0.6 9.1 9.7 9.7 42% 42% Q3 2021 Q3 2022 Q3 2022 at constant F/X* Local Travel * Based on constant F/X rates for CAD 8 | Third Quarter 2
Slide 10: Europe business segment revenue negatively impacted by the strong dollar
Europe business segment revenue, which we report in USD, is negatively impacted by the strong dollar. Europe Revenue by Type $ millions YOY % YOY %* 5.2 5.4 change change 0.5 4.5 0.3 (as reported) (constant F/X) 0.3 -40% -29% 4.7 5.0 4.3 -11% 5% Q3 2021 Q3 2022 Q3 2022 at constant F/X* Local Travel
Slide 11: We believe we can keep our fixed costs relatively low
We believe we can keep our fixed fixed costs relatively low in the foreseeable future—while revenues are expected to grow. Financial Performance Revenue Operating Expenses and Cost of Revenues $ millions $ millions 24.3 0.4 25.5 23.9 15.9 15.6 1.3 0.8 15.7 15.8 14.8 14.6 Q3 2019* Q3 2021 Q3 2022 Q3
Slide 12: Travelzoo's Global Reach and High-Quality Users
With more than 30 million members, 7.1 million mobile app users, and 4 million social media followers, Travelzoo is loved by travel enthusiasts who are affluent, active, and open to new experiences. Travelzoo's Global Reach High-Quality Users, Followers and Subscribers Members* Travelzoo U.S. Member
Slide 13: Part 2: Management Focus
Part 1: Third Quarter 2022 Performance Part 2: Management Focus Part 3: Travelzoo META 12 | Third Quarter 2022 Performance
Slide 14: Management focus
Management focus: • Increase number of members and accelerate revenue growth to reach, and then exceed, pre-pandemic levels. • Grow Jack’s Flight Club’s profitable subscription revenue. • Utilize higher operating margins to significantly increase EPS. • Launch Travelzoo META. 13 | Third Quarter 2022
Slide 15: Part 3: Travelzoo META
Part 1: Third Quarter 2022 Performance Part 2: Management Focus Part 3: Travelzoo META 14 | Third Quarter 2022 Performance
Slide 16: 15 | First Quarter 2022 Performance
15 | First Quarter 2022 Performance
Slide 17: What are the status and timing?
What are the status and timing? • We launched Phase 1 in Q2 in a controlled test environment to a limited set of users and have had significant learnings. • We are continuing to extensively gather data and analytics and deploy these into our strategy. • We plan to launch the next phase in Q4 and wil
Slide 18: What are Travelzoo META experiences?
What are Travelzoo META experiences? • Travelzoo META experiences will be browser-enabled entertaining travel experiences that allow members to interact with, and in, the Metaverse. • These experiences will, in many cases, overcome limitations of access, geography, economic and physical ability, as
Slide 19: Consumer interest is confirmed
Consumer interest is confirmed. • Travelzoo META is targeting a completely new demographic: Travelzoo META targets Generation Z. • While Travelzoo META targets Generation Z, we interviewed existing Travelzoo members who represent a wide range of travel enthusiasts and real-world travelers and found
Slide 20: Have a nice day!
NASDAQ: TZOO HAVE A NICE DAY! For questions, please contact Travelzoo Investor Relations: ir@travelzoo.com