Web Travel Group Limited · ASX:WEB
Web Travel — Investor Presentation (November 2018)
43 slides from Web Travel's investor presentation, Nov 5, 2018
Slide 1: Acquisition of Destinations of the World and Capital Raising
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES WEBJET LIMITED ACQUISITION OF DESTINATIONS OF THE WORLD AND CAPITAL RAISING JOHN GUSCIC, Managing Director TONY RISTEVSKI, Chief Financial Officer 5 November 2018 B2C TRAVEL B2B HOTELS Page 1
Slide 2: Important Notice and Disclaimer
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Important Notice and Disclaimer This presentation has been prepared by Webjet Limited ACN 002 013 612 ("Webjet") in relation to the proposed acquisition by Webjet of DOTW Holdings Limited ("DOTW") ("Acquisition") and a fully underwritten accelerat
Slide 3: Important Notice and Disclaimer (cont'd)
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Important Notice and Disclaimer (cont’d) No investment or financial product advice The information contained in this presentation does not constitute investment or financial product advice (nor taxation, accounting or legal advice), is not a recom
Slide 4: Important Notice and Disclaimer (cont'd)
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Important Notice and Disclaimer (cont’d) Financial data All dollar values are in Australian dollars ($ or AUD) unless stated otherwise. All Webjet references starting with “FY” refer to the financial year for Webjet, ending 30 June. For example, f
Slide 5: Agenda
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Agenda 1. Key Highlights 2. Transaction Overview 3. Overview of DOTW 4. Strategic Rationale 5. Financial Impact and Funding 6. Trading Update 7. Conclusion
Slide 6: 1. Key Highlights
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES 1. Key Highlights Page 6
Slide 7: Key Highlights
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Acquisition of Destinations of the World (“DOTW”), a leading B2B travel business, 1 for US$173 million (A$240 million) with additional performance based earn-out up to US$25 million (A$35 million)(1) Key 2 Represents a substantial increase in WebB
Slide 8: 2. Transaction Overview
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES 2. Transaction Overview Page 8
Slide 9: Transaction Overview
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Acquisition • Webjet has entered into a binding agreement to acquire DOTW for an enterprise value of US$173 million (A$240 million), representing: Terms − 10.5x FY18 EBITDA(1) pre synergies and before any earn-out payment − 7.5x FY18 EBITDA(1) pos
Slide 10: Transaction Overview (cont'd)
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Financing • US$20 million (A$28 million) of new Webjet shares issued to vendors demonstrating confidence in the combination and alignment of interests Transaction − US$19.5 million (A$27.1 million) of new Webjet shares issued to existing private e
Slide 11: Recap of the B2B Market Opportunity: JacTravel Case Study
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Highlights of JacTravel Acquisition Increasing Relevance of JacTravel Inventory Recap of the 10.0% 8.6% 8.0% B2B Market Deal closed in September 2017. Integration largely complete 6.0% 4.0% Opportunity: 2.0% 0.0% Sep-17 Jan-18 May-18 Sep-18 JacT
Slide 12: Organic Bookings Growth
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Organic Bookings Growth Continues to Increase Total Booking Growth: • B2C 4 yr CAGR = 21% • B2B 4 yr CAGR = 147% • B2C+B2B = 44% FY14 FY15 FY16 FY17 FY18 Webjet Webjet Webjet Webjet Lots of Hotels Webjet Lots of Hotels Lots of Hotels Lots of Hotel
Slide 13: 3. Overview of DOTW
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES 3. Overview of DOTW Page 13
Slide 14: DOTW is a Leading Independent B2B Player of Scale
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Business Overview TTV by Source Market(1) • Pure-play B2B accommodation wholesale Americas platform connecting hoteliers with OTAs, 5% DOTW is a corporate travel agents, retail travel agents, wholesalers and tour operators Europe 28% MEA 38% Leadi
Slide 15: 4. Strategic Rationale
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES 4. Strategic Rationale Page 15
Slide 16: Strategic Rationale for Acquisition
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Increases scale and consolidates WebBeds' position as the clear #2 global B2B provider 1 • The Acquisition increases WebBeds' FY18 TTV by A$734 million (US$529 million)(1) with a combined Strategic FY18 TTV of A$2,088 million (US$1,505 million) on
Slide 17: DOTW at a Glance
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES DOTW at a Glance TTV Grows To Over A$2.0 Billion 1. Scale c.5,000 c.12,300 FY18 TTV (A$ million) Consolidates Directly Customers contracted hotels(1) 734 2,088 WebBeds' Position as the Clear #2 Global 1,354 c.165,000 c.1.75 million Aggregated hote
Slide 18: 1. Scale Significantly Enhances WebBeds' Scale
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Continues WebBeds' Evolution – TTV (A$m)(1) 2,088 1. Scale 1,354 734 482 229 346 1,354 - 56 Significantly FY13 FY14 FY15 FY16 FY17 FY18 (2) FY18 PF (2) Enhances WebBeds' • Started with LOH in Dubai as an organic start up, initially serving the Mid
Slide 19: 2. Footprint Diversification of Global Footprint
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES FY18PF TTV by Source Market Pro-Forma A$2,088 million 2. Footprint Americas MEA Americas MEA Americas MEA 8% 19% 5% 7% 38% 24% APAC Diversification of + 14% Europe 28% = APAC 18% Global Footprint Europe Europe APAC 51% 59% 29% FY18PF TTV by Destin
Slide 20: 3. Breadth and Depth Significant Addition of Directly Contracted Inventory
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Additional Directly Contracted Inventory a Key Competitive Driver, Providing Significant Benefits Across Allotment, Availability and Rates DOTW(1) WebBeds(2) • Direct contracts are a key competitive driver in B2B wholesale distribution offering hi
Slide 21: 4. Synergies Tangible Revenue and Cost Synergies
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES DOTW will be integrated into the WebBeds Regional Geographic Structure DOTW will remain a product platform, along with the Lots of Hotels, Sunhotels, FIT Ruums and JacTravel platforms Focused reduction in overlapping headcount and filling of vac
Slide 22: 5. Financial Impact and Funding
5. Financial Impact and Funding Page 22
Slide 23: Illustrative Financial Impact
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES DOTW will Meaningfully Enhance Webjet's B2B business FY18 TTV Pro-Forma TTV(1) Illustrative B2B 45% B2C 44% Financial B2C 55% B2B 56% Impact A$3,012 million A$3,746 million • Meaningfully increases Webjet's B2B business Acquisition increases FY1
Slide 24: Funding the Acquisition
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Entitlement Offer Debt / Cash Consideration Vendor Share Placement Structure and • Entitlement Offer to raise A$153 million • A$102 million (US$73 million) of cash, • A$28 million share placement to Gulf Size • Comprises Institutional Entitlement
Slide 25: Entitlement Offer Timetable
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Dates and times are subject to change without notice Date Trading halt and announcement of acquisition and capital raise Monday, 05 November 2018 Entitlement Institutional Entitlement Offer and Institutional Bookbuild opens Monday, 05 November 201
Slide 26: 6. Trading Update
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES 6. Trading Update Page 26
Slide 27: FY19 Trading Update
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES • On track to deliver at least A$110 million underlying EBITDA for the existing Webjet Webjet businesses for FY19 • Assuming the acquisition of DOTW closes on 22 November 2018, Webjet expects DOTW to contribute incremental EBITDA of at least A$10
Slide 28: 7. Conclusion
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES 7. Conclusion Page 28
Slide 29: Conclusion
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Acquisition of DOTW, a leading B2B travel business, for US$173 million (A$240 1 million) with additional performance based earn-out up to US$25 million (A$35 million)(1) Conclusion 2 Represents a substantial increase in WebBeds' scale, with increm
Slide 30: Appendix A: Additional Financial Information
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES APPENDIX A: Additional Financial Information B2C TRAVEL B2B HOTELS Page 30
Slide 31: DOTW Historic Income Statement
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES A$ million Jun-17 Jun-18 DOTW Historic TTV 684 734 Income Statement Net Revenue 60.1 65.1 Expenses (36.5) (42.3) Note: USD:AUD FX conversion assumes a spot rate at 1 November 2018 of 1.3878. Numbers are subject to the effects of rounding (1) Based
Slide 32: Pro-forma Balance Sheet
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Pro-forma Adjustments for Acquisition Webjet DOTW of DOTW and Capital Pro-Forma A$ million (30 June 2018)(1)(4) (30 June 2018)(2) Raising Webjet Group(3) Balance Sheet Cash 138 0 49 186 Receivables and other 286 91 (1) 376 Note: USD:AUD FX convers
Slide 33: Appendix B: DOTW Management
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES APPENDIX B: DOTW Management B2C TRAVEL B2B HOTELS Page 33
Slide 34: DOTW – Key Management
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Chief Executive Officer Chief Operating Officer James Burdett Alaa Saleh DOTW – Key • 10 years of industry experience • 4 years of industry experience Management • 10 years with DOTW • 3 years with DOTW Chief Commercial Officer Bartomeu Gili • 20
Slide 35: Appendix C: Foreign Selling Restrictions and Risk Factors
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES APPENDIX C: Foreign Selling Restrictions and Risk Factors B2C TRAVEL B2B HOTELS Page 35
Slide 36: Foreign Selling Restrictions
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Foreign Selling Restrictions Hong Kong WARNING: This document has not been, and will not be, registered as a prospectus under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of the Laws of Hong Kong (the "CO"), nor has
Slide 37: Foreign Selling Restrictions (cont'd)
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Foreign Selling Restrictions (cont’d) Singapore This document and any other offering materials relating to the New Shares has not been and will not be registered as a prospectus with the Monetary Authority of Singapore (“MAS”). Accordingly, this d
Slide 38: Risk Factors
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Factors 1. Operational risks This section discusses some of the risks associated with an investment in Webjet. Webjet's business is subject to a number of risk factors both specific to its business and of a general nature which may impact on
Slide 39: Risk Factors (cont'd)
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Factors (cont’d) Webjet is substantially dependent on the continuing service of its Managing Director as well as other key executives. There is no guarantee Webjet will be able to retain the services of such persons Online booking market Webj
Slide 40: Risk Factors (cont'd)
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Factors (cont’d) Hostilities, terrorism and other external events Webjet may be adversely impacted by international hostilities or war, acts of terrorism, epidemics or outbreaks of disease, political or social instability, natural disasters a
Slide 41: Risk Factors (cont'd)
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Factors (cont’d) Integration risk The Acquisition involves the integration of DOTW's business, which has previously operated independently to Webjet. There is a risk that the integration may be more complex than currently anticipated, encount
Slide 42: Appendix D: Summary of Underwriting Agreement
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES APPENDIX D: Summary of Underwriting Agreement B2C TRAVEL B2B HOTELS Page 42
Slide 43: Summary of Underwriting Agreement
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Summary of Underwriting Agreement Webjet has entered into an underwriting agreement with the Joint Lead Managers (Underwriters) dated 5 November 2018 (Underwriting Agreement). The Underwriters have agreed to underwrite the Entitlement Offer on the
Web Travel Group — Investor Presentation (November 2018) on 6ix